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In a free-market system, producers are motivated to reduce cost…

  • Question 15c of 25 - Profit and the profit motive

  • Maximum Attempts: 1
  • Question Type: Multiple Choice
  • Maximum Score: 2
  • Question: In a free-market system, producers are motivated to reduce costs and increase revenues because of which of the following?
  • Answers:
  1. Marginal analysis.
  2. The profit motive.
  3. Opportunity costs.
  4. The production possibilities frontier.

The correct answer is: The profit motive. The quest for profit drives producers in a freemarket system, and profit is calculated by subtracting costs from revenues.

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