Recall the Application about running a software programming business to answer the following question(s).The current income you would sacrifice to start your own software development business is part of the:
A. opportunity cost of invested funds.
B. opportunity cost of starting a business.
C. cost of doing business.
D. present value of your initial investment.
Answer: B
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Sarah makes giant wind chime sculptures for a living. When she makes 4 sculptures, she earns $10,000. When the makes 5 sculptures, she earns $12,500. Next door, Gilbert runs a meditation clinic
When Sarah makes 4 giant wind chime sculptures, the noise from the sculptures does not disrupt his patients, and he earns $7,500. When Sarah makes 5 sculptures, the noise is disruptive and Gilbert's profits fall to $6,000. The city has an ordinance which prohibits noise that disrupts the community. a. If you were the benevolent social planner, would you like to see Sarah make 4 sculptures or 5? Why? b. If bargaining between Sarah and Gilbert is easy, how many sculptures will Sarah make? Describe the bargain that results, if any, including the amount of money that changes hands. c. Is the outcome in part b an outcome that the benevolent social planner would endorse? Why or why not?
The price of dishwashers has remained relatively constant while the quality of dishwashers has improved. The CPI
A) is adjusted monthly to reflect the improvement in quality. B) is increased monthly to reflect the increased quality of dishwashers. C) has an upward bias if it is not adjusted to take account of the higher quality. D) has an upward bias because it does not reflect the increased production of dishwashers. E) should not take account of any quality changes because it is a price index not a quality index.
Which of the following terms describes the process wherein many of the different stages of producing a good happen in different geographic locations?
a. supply chain management b. splitting up the supply chain c. splitting up the value chain d. value Chain management
If actual reserves in the banking system are $8,000, checkable deposits are $70,000, and the legal reserve ratio is 10 percent, then excess reserves are:
A. $2,000. B. $500. C. zero. D. $1,000.