Explicit costs are costs that:
A. are zero when no output is produced.
B. do not depend on the quantity of output produced.
C. require a firm to spend money.
D. depend on the quantity of output produced.
Answer: C
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The most accurate procedure for finding out whether it is more efficient for a commercial airline to use 727s or 757s for its domestic flights is to
A) compare the fuel efficiency of 727s and 757s. B) compare the fuel efficiency and operating cost of 727s and 757s. C) compare the acquisition cost, operating cost, and fuel efficiency of 727s and 757s. D) compare the acquisition cost, operating cost, and fuel efficiency per passenger seat of 727s and 757s. E) see whether the airline has chosen to use 727s or 757s.
In a free market there are significant restrictions on how a good or service can be produced or sold
Indicate whether the statement is true or false
Which of the following is a difference between an income tax and an excise tax on gasoline? a. An income tax exemplifies the ability to pay principle, while an excise tax on gasoline exemplifies the benefit principle. b. An income tax is based on a marginal tax rate, while an excise tax on gasoline is based on an average tax rate. c. An income tax is proportional, while an excise tax on
gasoline is progressive. d. An income tax increases consumer surplus, while an excise tax on gasoline increases producer surplus.
Willie's wage increased, and he responded by enjoying more hours of leisure per day. Is Willie's behavior consistent with an upward-sloping labor-supply curve?