The figure above shows the production possibilities frontier for a country. How does the opportunity cost of compact cars forgone per SUV gained moving from point C to point B compare with the movement from point B to point A?
A) The opportunity cost of moving from point C to point B is greater than the movement from point B to point A.
B) The opportunity cost of moving from point C to point B is less than the movement from point B to point A.
C) The opportunity cost of moving from point C to point B is the same as the movement from point B to point A.
D) The opportunity costs cannot be compared because the units of moving from point C to point B differ from the units of moving from point B to point A.
E) More information is needed to determine how the two opportunity costs compare.
B
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A normal profit is
A) revenues minus opportunity cost of zero. B) revenues minus accounting cost of zero. C) a zero accounting profit. D) revenues minus accounting and opportunity cost of zero.
Suppose a computer manufacturer purchases a $100 case from a supplier, a $300 computer chip from another supplier, and sells the computers for $1000 . How much did the company contribute to GDP?
a. $1000 b. $900 c. $700 d. $600 e. $400
In the country of Freedonia, men and women have the same level of education and choose different forms of work in the same proportions. The only real difference is that men typically stay home to raise young children, returning to the work force after their children enter elementary school. If no discrimination exists, then we would expect that, on average,
a. women would earn less than men. b. women would earn more than men. c. men and women would earn the same wage. d. wage differences between men and women would be due to differences in beauty.
Which of the following statements regarding accounting and economic profits is FALSE?
A) Economic profits can be zero even if accounting profits are positive. B) Economic profits = total revenue - (explicit + implicit costs) C) Accounting profits can be negative if economic profits are positive. D) Accounting profits = total revenue - explicit costs