Pat used to work as an aerobics instructor at the local gym earning $35,000 a year. Pat quit that job and started working as a personal trainer. Pat makes $50,000 in total annual revenue. Pat's only out-of-pocket costs are $12,000 per year for rent and utilities, $1,000 per year for advertising and $3,000 per year for equipment.For Pat to earn normal profit, Pat's accounting profit would have to be ________.
A. $50,000
B. $0
C. $15,000
D. $35,000
Answer: D
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Which of the following statements is likely to be true according to Okun's Law?
A) The unemployment rate remains constant when the growth rate of real GDP is 0%. B) The unemployment rate remains constant when the growth rate of real GDP is 3%. C) The unemployment rate increases when the growth rate of real GDP is above 3%. D) The unemployment rate declines when the growth rate of real GDP is below 3%.
Today, the most common exchange rate arrangement in the world is
A) the fixed exchange rate system. B) the gold standard system. C) the managed floating system. D) the freely floating exchange rate system.
Rose, who grows geraniums to sell, is currently producing a level of output at which her marginal cost equals her average variable cost. What must be true about Rose's average total cost at this level of output? a. It is at a minimum
b. It is at a maximum. c. It is falling with increased output. d. It is equal to average variable cost.
The pursuit of profit will encourage firms to
a. produce efficiently and keep their costs low. b. produce goods and services that consumers value highly relative to costs. c. discover and develop better products and lower-cost production methods. d. All of the above are correct.