The major cost of production in the economy is
a. interest expense.
b. capital costs.
c. rents.
d. profits.
e. wages.
e
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In the figure above, if real GDP is $20 trillion, aggregate planned expenditure is ________ $20 trillion and unplanned inventory changes are ________
A) equal to; equals to zero B) less than; negative C) equal to; negative D) less than; positive E) equal to; positive
Assume that the user cost of capital (C) is simply
where r is the after tax rate of return, ? is the depreciation rate, ? is the corporate tax rate and,
r is the individual tax rate. Now assume further that the after-tax rate of return is 10 percent
and the economic depreciation rate is 2 percent. The firm faces corporate taxes of 35 percent
with an individual tax rate of 25 percent. Suppose that we now know that the present value of
depreciation allowances is 0.20. In addition, there is an investment tax credit of 0.10. What
effect does this new information have on the user cost of capital?
The supply curve of a uniquely talented actor or superstar athlete will be perfectly inelastic
Indicate whether the statement is true or false
In Figure 3.2, what is the variable cost to the producer? 
A. 0BCQ* B. 0PCQ* C. BP*C D. P*AC