An understanding of opportunity costs is important to understanding:
a. how to calculate the total revenue generated by a firm.
b. how to assess the economic profitability of a firm
c. How to calculate the tax liability of a firm.
d. how accountants calculate accounting profits.
b
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I + (G – T) =
a. S + M b. S + X c. S + (M - X) d. S + (I - M)
If the minimum wage applies to one sector (the covered sector) but not another sector (the uncovered sector), an increase in the minimum wage in the covered sector is likely to result in which of the following?
A. less employment in the uncovered sector B. a lower wage in the covered sector C. workers willingly leaving the covered sector for the uncovered sector in search of higher wages D. a lower wage in the uncovered sector E. greater employment in the covered sector
In the long run, if government increases spending ________
A) interest rates decrease B) it crowds out private investment C) saving increases D) all of the above E) none of the above
Why is market definition important for economic decision making?
A) A firm is interested in knowing its actual and potential competitors. B) A firm will define its market in order to maximize revenue. C) Government regulators are interested in knowing the effect of mergers and acquisitions on competition and prices in a particular market. D) both A and C E) both A and B