Refer to Scenario 14-2. When the firm increases its output from 120 units to 121 units, its profit

A) decreases by $3.35.
B) decreases by $45.00.
C) increases by $45.00.
D) increases by $3.35.

Profit

The financial gain obtained when the amount of revenue gained from a business activity exceeds the expenses, costs, and taxes associated with the activity.

Average Total Cost

Average Total Cost is an economic concept that represents the total cost of production divided by the quantity of output produced, encompassing both fixed and variable costs.

Output

The total amount of goods or services produced by a firm, industry, or economy in a given period.