A firm's managers need information on the firm's revenue and costs as well as information on the value of a firm's assets and the amount of the firm's debts to answer three basic questions. Which of the following is not one of those three basic questions?
A) what to produce?
B) how to produce it?
C) what price to charge?
D) where to produce?
Answer: D
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Financing an investment with debt ________ the net present value of the investment because interest payments ________ tax deductible and the full amount of the principal is due in ________.
A) decreases; are; the present time B) increases; are not; the future C) increases; are; present time D) increases; are; the future
When did intellectual property rights become part of trade agreements?
What will be an ideal response?
Answer the following questions true (T) or false (F)
1. In the market for factors of production, households earn income by supplying factors of production to firms. 2. One example of human capital is the amount of savings that you have. 3. Human capital refers to the accumulated skills and training that workers possess.
Increasing marginal opportunity cost implies that
A) the more resources already devoted to any activity, the payoff from allocating yet more resources to that activity increases by progressively smaller amounts. B) the more resources already devoted to any activity, the benefits from allocating yet more resources to that activity decreases by progressively larger amounts. C) that rising opportunity costs makes it inefficient to produce beyond a certain quantity. D) the law of scarcity.