Which of the following is not true with regard to economic profit?
a. economic profit equals total revenue minus total cost
b. economic profit excludes implicit cost
c. economic profit is any profit greater than a normal profit
d. firms attempt to maximize economic profit
e. long-run economic profit is always zero in perfect competition
B
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The Robinson-Patman Act of 1936 amended the: a. Sherman Act
b. Clayton Act. c. Federal Trade Commission Act. d. Wagner Act.
If decision makers do not bear the major wealth effects of their decisions, then
A. the same person in the management structure must hold decision management and control. B. the same managers hold initiation and ratification of decisions. C. separate decision makers must hold decision management and decision control. D. decision management is clearly integrated with decision control.
Refer to Figure 35.3 for the production possibilities curves for the United States and Mexico. These two curves indicate that
A. The United States should specialize in the production of machinery. B. The United States should specialize in the production of both goods because it has an absolute advantage in the production of both. C. Mexico should specialize in the production of machinery. D. Mexico should specialize in the production of tomatoes.
The decision about whether to change prices frequently or infrequently is an application of the:
A. cost-benefit principle. B. scarcity principle. C. principle of increasing opportunity cost. D. principle of comparative advantage.