Profits represent
A) a reward to entrepreneurs.
B) the income earned from a bond.
C) the difference between total tax revenue and total government spending.
D) the payments firms make to their employees.
A
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The nominal interest rate ________
A) makes no allowance for inflation B) is a percentage of the amount borrowed C) is the rate that most banks advertise D) all of the above E) none of the above
The reward for forgoing present consumption is
a. rent b. profit c. roundabout production d. transfer payment e. interest
The trade-creation effect refers to:
a. a reduction in economic efficiency as a result of a preferential trade agreement. b. a production shift to a higher-cost producer as a result of a preferential trade agreement. c. the outcome of a preferential trade agreement that allows a country to obtain goods at a lower cost than is available at home. d. diversion of production from a country that has comparative advantage. e. a production shift to a country that does not have comparative advantage.
A country could effectively increase its productivity and per capita economic growth rate by ______.
a. promoting larger families b. investing in physical capital c. requiring children to work rather than attend school d. encouraging citizens to consumer their incomes