What is the difference between explicit and implicit costs?
What will be an ideal response?
Explicit costs are out-of-pocket expenditures for resources hired from outside the firm while implicit costs are opportunity costs for using firm-owned resources.
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What is the marginal product of labor?
What will be an ideal response?
What is a term referring to the fact that a business that focuses on one or a few products is more successful than firms that try to make a wide range of products?
a. scarcity b. division of labor c. core competency d. specialization
Resource substitutes are resources that enhance one another's productivity, a decrease in the price of one resource increases the demand for the other
Indicate whether the statement is true or false
The price level has been rising 5 percent a year for 10 years and is expected to continue to do so. The nominal rate of interest is 4 percent. The real rate of interest is
A. 9 percent. B. 5 percent. C. 1 percent. D. -1 percent.