In the Classical model, the level of employment is determined by the level of aggregate supply.
Answer the following statement true (T) or false (F)
True
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Under the monetary growth rule proposed by the monetarists, the money supply would grow each year at a constant rate equal to the long-run rate of growth of
A) employment. B) inflation. C) interest rates. D) real GDP.
The marginal propensity to consume is equal to the slope of the consumption function
Indicate whether the statement is true or false
What involves taking the risks that are necessary to seek out business opportunities?
a. Invention b. Benchmarking c. Averaging d. Entrepreneurship
Suppose Winston's annual salary as an accountant is $60,000, and his financial assets generate $4,000 per year in interest. One day, after deciding to be his own boss, he quits his job and uses his financial assets to establish a consulting business, which he runs out of his home. To run the business, he outlays $8,000 in cash to cover all the costs involved with running the business, and earns revenues of $150,000. What are Winston's economic profits?
A. $138,000 B. $78,000 C. $150,000 D. $142,000