3. Economists normally assume that the goal of a firm is to (i) make profit as large as possible even if it means reducing output.

(ii) make profit as large as possible even if it means incurring a higher total cost.

(iii) make revenue as large as possible.

a. (i) and (ii)

b. (i) and (iii)

c. (ii) and (iii)

d. None of the above are correct

5. Economic profit is equal to

a. total revenue minus the explicit cost of producing goods and services.

b. total revenue minus the opportunity cost of producing goods and services.

c. total revenue minus the accounting cost of producing goods and services.

d. average revenue minus the average cost of producing the last unit of a good or service.