Which of the following is an implicit cost of production?
A) the loss in the value of capital equipment due to wear and tear
B) the salary you pay yourself for running your business
C) the utility bill paid to water, electricity, and natural gas companies
D) the interest you pay your mother for the money she loaned you to start your business
Answer: A
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If aggregate expenditure in an economy equals 1,000 + 0.9Y and full employment real GDP equals 9,000, then this economy has
A. an inflationary gap. B. no output gap. C. a recessionary gap. D. no autonomous expenditure.
A higher savings rate that leads to an increase in the capital stock
A) leads to higher interest rates. B) leads to increases in labor productivity. C) immediately decreases investment. D) is associated with a decrease in the rate of growth of the population.
An increase in the number of consumers
A) results only in a movement along the demand curve. B) shifts the supply curve leftward. C) shifts the demand curve rightward. D) Both answers B and C are correct.
Which major actor is at the center of the foreign exchange market?
A) corporations B) central banks C) commercial banks D) non-bank financial institutions E) individual firms