Which of the following is most likely to be a fixed cost?
A. Shipping charges.
B. Property insurance premiums.
C. Wages for unskilled labor.
D. Expenditures for raw materials.
Answer: B
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A country will realize no gains from trade if
A) pre-trade and free-trade relative prices are identical. B) all countries employ the same technology. C) it does not have an absolute advantage in at least one good. D) its wage exceeds the world average. E) pre-trade and free-trade relative prices are not identical.
When considering international trade, which of the following would be most conducive to domestic economic growth?
A) a closed economy B) an economy in which its domestic industries are protected by tariffs C) an economy with free and open markets to the outside world D) an economy in which most decisions are made by a central governmental authority
The marginal productivity principle implies that
a. quantity demanded of an input normally declines as the input price falls. b. at equilibrium, profit from the last unit of input will be zero. c. for maximizing profit, marginal revenue product should be greater than price. d. marginal productivity of inputs increase when price of inputs increase.
Which of the following is a TRUE statement?
A. Opportunity cost is always a foregone opportunity. B. Opportunity cost is always measured in the nation's currency. C. Opportunity cost is an objective measure since the cost of an activity is the same for everyone. D. The fewer alternatives there are the greater the opportunity cost.