Accounting profit is equal to
A) total revenue minus dividends and interest.
B) dividends paid.
C) total revenue minus implicit costs.
D) total revenue minus explicit costs.
D
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In the long run, a firm will exit an industry if the market price is less than its
a. break-even price. b. shutdown price. c. marginal cost. d. fixed cost.
Investment diversion is considered an obstacle to economic growth because:
a. it would be better to increase the mortality rate of the country, and thus have a higher per capita real GDP. b. investment in health care is highly appreciated by the international community. c. capital infrastructure automatically eliminates population problems. d. the investments in health care affect only the poorest, the least productive inhabitants of a country. e. there is no way for a country to build its industries without an increase in investment on infrastructure.
Which statement best describes the behavior of the monopsonist in the labor market?
A. It hires less labor and pays a lower wage rate than in the perfectly competitive case. B. It must pay different amounts to each unit of labor hired. C. It hires less labor but pays the perfectly competitive wage rate. D. It restricts its output to keep the product price high.
A firm with market power will be able to sell all of their output at any price they desire.
Answer the following statement true (T) or false (F)