If an investment project costing $2,700 was expected to yield $1,000 (to be received at year end) for each of the next three years, a profit-maximizing entrepreneur would
a. definitely undertake the project.
b. never undertake the project.
c. undertake the project if the interest rate exceeded 12 percent.
d. undertake the project if the interest rate was 5 percent or less.
D
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The figure above shows the supply curve for soda. The market price is $1.00 per soda. The marginal cost of the 10,000th soda is
A) $0.00. B) $0.50. C) $1.00. D) more than $0.50 and less than $1.00. E) None of the above answers is correct.
The Lorenz curve demonstrates:
A. inequality visually; the more linear the curve, the less inequality exists. B. inequality visually; the more linear the curve, the more inequality exists. C. average income levels per capita; the more linear the curve, the less inequality exists. D. average income levels per quintile; the more linear the curve, the more inequality exists.
A study of New York City (NYC) tax rates concluded that taxes on the nonmanufacturing sector should be higher since that sector has fewer alternatives. Manufacturers are more mobile and may move to avoid higher taxes. This means that
a. nonmanufacturing firms have a more elastic demand for NYC locations. b. manufacturing firms have an inelastic demand for the NYC locations. c. nonmanufacturing firms have relatively inelastic demand for the NYC locations. d. nonmanufacturing demand for NYC locations is perfectly elastic.
Suppose good X has a negative income elasticity of demand. This implies that good X is
a. a normal good. b. a necessity. c. an inferior good. d. a luxury.