Which of these types of costs can be ignored when an individual or a firm is making decisions?
a. sunk costs
b. marginal costs
c. variable costs
d. opportunity costs
a
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XYZ Gadget Company is currently considering which investment projects it should undertake. The following list of projects along with the estimated rate of return of each project is presented to the executive management team:Project A (8.5%)Project B (7%)Project C (6%)Project D (11%)Project E (5.5%)The current interest rate in the loanable funds market is 5%. However, if an increase in government borrowing pushes the interest rate to 7.5%, we would expect the company to discontinue investment plans for all but ________ of its planned projects.
A. two B. three C. four D. one
If the price of cereal increases by 10 percent and the amount of milk demanded decreases by 2 percent, then the cross-price elasticity of these goods is:
A. 5. B. 5. C. 0.2. D. 0.2
For an individual's supply curve of labor to be backward bending:
a. the substitution effect must be greater than the income effect. b. the substitution effect must be equal to the income effect. c. the substitution effect must be less than the income effect. d. is an impossibility.
In this graph, at point e1, price level is ______.
a. inflationary
b. deflationary
c. stable
d. not shown