Which of the following would be considered an implicit cost?
A. Health insurance of employees paid for by the firm
B. The water bill of the firm
C. The salaries paid to the managers of the firm
D. Foregone rent on assets owned by the firm
Answer: D
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Assume that when the price of good X is $7, quantity demanded is 25. When price is increased to $9, quantity demanded falls to 20. Based on this information, over the range in question demand is elastic
Indicate whether the statement is true or false
In which type of contract is the agent paid per unit of output?
A) A commission based contract. B) A sharecropping contract. C) A piece rate contract. D) A contract with stock options as salary.
You hire a set of economic consultants and they tell you the following: At a price of $5, 24 units of the good could be sold; at a price of $7, 25 units of output could be sold. The marginal revenue of the 25th unit of output is
a. $14 b. $55 c. $6 d. $168 e. $175
As the price of good A rises, the demand for good B rises. Therefore, goods A and B are
A) normal goods. B) inferior goods. C) substitutes. D) complements. E) none of the above