Suppose Jon Stewart of the "Daily Show" makes an annual income of $2,000,000. If he quit his television job and went into producing he could make $400,000 per year. Jon Stewart's annual economic rent to labor is
A) $1,400,000.
B) $2,000,000.
C) $400,000.
D) $1,600,000.
Answer: D
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Refer to Figure 13-1. Ceteris paribus, a decrease in the value of the domestic currency relative to foreign currencies would be represented by a movement from
A) AD1 to AD2. B) AD2 to AD1. C) point A to point B. D) point B to point A.
If you can produce more of something than others with the same resources, you have
A) a free-market economy. B) an absolute advantage. C) an efficient production system. D) a comparative advantage.
Which of the following is not considered a factor contributing to economic growth?
a. Growth in the quantity and quality of labor resources used b. Growth in physical capital inputs (machines, tools, buildings, and inventories) c. Growth in the money supply relative to the growth of final goods and services d. Government protection of property rights
Which of the following techniques adopted by the central banks around the world have helped them to achieve credibility?
a. Maintaining a low rate of inflation through tight monetary policies b. Publicly announcing a target rate of inflation c. Refusing to bail out the commercial banks at times of failure d. Supporting all government budget deficits through deficit financing e. Reducing unemployment amidst high inflation