Scenario 9.2 Consider a Publicly Held Firm (One Whose Stock Shares Are

Multiple Choice

Scenario 9.2
Consider a publicly held firm (one whose stock shares are traded on the stock exchange) that earned revenue worth $350 million and incurred land, labor, and debt costs worth $320 million. The stockholders who have invested a total of $100 million in this firm could have earned 10 percent return on other comparable investments.
-A zero economic profit is not a bad thing because:

A) it is a situation in which the owners, or shareholders, of a firm could not do better elsewhere.
B) it is a situation in which the resources of a firm are always optimally utilized.
C) it means that a firm is paying an interest rate that is below the market rate.
D) it means that stock prices will not fall.
E) it means that investors are better off in the current venture than they would be in any other investment.