What is the distinction between the price of capital equipment and the rental rate of capital?
What will be an ideal response?
The price of a unit of capital is how much must be paid to acquire the piece of capital equipment. The rental rate of capital is the amount that must be paid to use the unit of capital equipment. For instance, the copy machine at the local Quik Print has a price of $10,000 but its services can be rented from the Quik Print for $50 per hour.
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If the United States imposes a tariff on $1 per imported shirt, the tariff will
A) raise the price of a shirt to U.S. consumers. B) benefit U.S. shirt producers. C) decrease imports of shirts into the United States. D) all of the above
Yolanda wants to expand her microbrewery business by buying out a competitor and is going to sell newly-issued corporate bonds to do so. This is an example of using ________ for her expansion plans
A) coupon payments B) direct finance C) indirect finance D) retained earnings
If the federal budget goes from a budget deficit in Year 1 to a budget surplus in Year 2, does it follow that the federal government acted to raise taxes or cut government spending in Year 2?
What will be an ideal response?
Which of the following is consistent with a political and legal framework that discourages economic growth?
A. Taxation and regulation that are not very burdensome B. The allocation of bank credit by the government rather than by markets C. A speedy approval process for new businesses D. Agricultural prices that are allowed to vary according to market conditions