Explaining
The goal of a firm is to maximize profits or minimize losses. The firm can achieve this goal by following two rules. First, the firm should operate where MR = MC. Second, the firm should shutdown rather than operate if it can reduce losses by doing so.
Read more about this topic: Shutdown (economics)
Famous quotes containing the word explaining:
“Ezra Pound still lives in a village and his world is a kind of village and people keep explaining things when they live in a village.... I have come not to mind if certain people live in villages and some of my friends still appear to live in villages and a village can be cozy as well as intuitive but must one really keep perpetually explaining and elucidating?”
—Gertrude Stein (1874–1946)
“If you’re lucky, you have money. That’s why it’s better to be born lucky than rich. If you’re rich, you can always lose your money, but if you’re lucky, you’ll always get more money.”
—Anthony Pélissier. Explaining her philosophy of life to her son (1949)
“Behold, Esau my brother is a hairy man, and I am a smooth man.”
—Bible: Hebrew Jacob, in Genesis, 27:11.
To his mother Rebekah, explaining how the blind Isaac might discover the ploy of his pretending to be Esau. “Esau was a cunning hunter, a man of the field; and Jacob was a plain man, dwelling in tents.” (25:27)