Economics

The questions below are intended to give you an opportunity to think about course content that is related to the Unit 4 Complete assignment but also how economics is related to your own personal life.

It is recommended that you answer the questions below, after you have viewed the Unit 4 Attend videos and completed the Read assignment for Unit 4 which covers chapters 21 and 22 in the course e-book, Economics (Arnold, 2013). You are also advised to read any relevant articles that can be found in the Course Materials link as well as do some research on the topic using the OCLS and the Internet.

Please answer both questions and letter your answers.

There are various objectives that firms may pursue. These include profit maximization, revenue maximization, sales maximization, and profit satisficing.

(a) What is profit, or how is profit calculated?

(b) Do you think firms really try to maximize profits? Do firms know what prices to charge to maximize profits?