When an entrepreneur invests his own financial capital in order to start a business
A) the opportunity cost of capital should be included in the economic cost of doing business.
B) the investment is treated as a fixed cost, so it should not be considered as a cost of doing business.
C) the firm's economic profits will exceed its accounting profits.
D) the accounting costs increase because the funds would otherwise have to be borrowed.
Answer: A
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Explain the Taylor rule, including the formula for setting the federal funds rate target, and the components of the formula. If the Fed were to use this rule, how many goals would it use to set monetary policy?
What will be an ideal response?
The demand curves for gold in New York and Zurich can both be represented by a line with negative slope, -b. When the price is zero the demand for gold is x ounces higher in New York than in Zurich
At the current price of gold the price elasticity of demand for gold in New York and Zurich is -3 and -4 respectively. The value of x equals A) a quarter of the current demand for gold in New York B) a third of the current demand for gold in New York C) a half of the current demand for gold in New York D) three-quarters of the current demand for gold in New York E) none of the above
Unlike an owner, a manager may be more concerned with _____ than with _____. Which pair of words best completes this sentence?
a. profits, personal benefits b. personal benefits, profits c. profits, working conditions d. cost, revenue
An increase in the demand for a product will cause output to:
a. increase and the demand for the resources used to produce the product to rise b. increase and the demand for the resources used to produce the product to fall. c. decline, while the demand for the resources used to produce the product remains constant. d. increase and the price of resources used to produce the product to increase if their supply is perfectly elastic.