Which one of the following variables is most likely to increase as production effort is increased?
a. Net revenue
b. Marginal costs
c. Marginal revenue
d. Total costs
e. Average revenue
Ans: d. Total costs
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Dynamic tax analysis generally predicts
A) that the higher the tax rate is, the higher the tax revenue will continue to be into the future. B) that the higher tax rates lead to higher revenues only to a point at which revenues will begin to decrease due to a diminishing tax base. C) that lower tax rates will always and continuously lead to increased tax revenues. D) that lower tax rates are always going to lead to decreased tax revenues.
Economic profit is always
A) greater than accounting profit. B) equal to accounting profit. C) less than accounting profit. D) equally likely to be either greater or less than accounting profit.
Suppose that equilibrium in the dollar-pound market occurs where 300 million pounds are demanded at a price of $1.75 per pound. If the current exchange rate is $1.60 per pound, we know that
a. the dollar-pound market is in equilibrium b. there is an excess demand for pounds, so the dollar price of the pound will rise c. there is an excess demand for pounds, and the pound is overvalued d. there is an excess supply of pounds, and the dollar price of the pound will rise e. there is an excess supply of pounds, and the dollar price of the pound will fall
If the infant industry argument is used to protect an industry that has already matured, then
A. consumers lose because they will pay a price for a product that is above the world price. B. stockholders lose because the firm cannot compete with other firms. C. consumers lose because they will pay a price for a product, which is less than the world price. D. no one loses.