When economic profits are positive, accounting profits
A) must be positive.
B) will be negative.
C) will equal zero.
D) could be positive, negative or zero.
A
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If a college degree is used to signal high ability, but the cost of a college degree is relatively high,
A) a separating equilibrium is achieved. B) a pooling equilibrium is achieved. C) even low-ability workers will attend college. D) the share of high-ability workers must be 1.
Refer to the above table. Suppose the marginal revenue product of the 5th worker is $800. This implies that
A) the price of the good is $5.33. B) the price of the good is $8. C) the price of the good is $70. D) we cannot tell what the price of the good is without more information.
Which of the following statements about business cycles is correct?
a. Business cycles are always caused by demand-side effects b. Business cycles are always caused by supply-side effects c. Business cycles are always initiated by domestic-based shocks d. Business cycles are always initiated by foreign-based shocks. e. Business cycles can originate in the real, social, financial, and/or political sector.
Which of the following would be an example of government intervention to correct a market failure caused by buyers having inadequate information about sellers?
A. Providing unemployment compensation insurance B. Sponsoring legislation to reduce pollution C. Licensing of medical doctors and surgeons D. Requiring all car drivers to buy auto insurance