The Lawn Ranger, a landscaping company, has total costs of $5,000 and total fixed costs of $3,000. The Lawn Ranger's total variable costs are
A. $2,000.
B. $3,000.
C. $5,000.
D. indeterminate because the firm's output level is not known.
Answer: A
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Refer to Common Property II. Suppose the common property becomes privately owned. If the owner charges a competitive entrance fee for the right to use the property, social gain will equal
The following questions refer to the accompanying diagram, which shows the benefits and costs associated with the use of a common property.
a. area C + D + F + G + I.
b. area F + G + H + I.
c. area A + B + C + D + F + G + I.
d. area A + B + C + D + E + F + G + H + I.
To change the federal funds rate, the Fed
A) coordinates with banks on establishing the new rate. B) tells banks how much to charge. C) uses open market operations to change the quantity of reserves. D) changes the income tax rate on interest income. E) increases or removes money from the stock market.
A currency's role as an international unit of account is due to
A) invoicing costs. B) transaction costs. C) information costs. D) intervention costs.
When a factory pollutes the environment, there are costs associated with the damage to human health, property values, wildlife habitat, reduction of recreation possibilities, or other negative impacts. The term ________________ is used to describe those costs, which fall on third parties unrelated to the business.
a. positive externalities b. additional external costs c. collateral damage d. social externalities