Suppose you were working for Richstone's bakery and calculating whether the bakery was making a profit, considering the recent increase in rent. You have the following data: P = $20, AVC = $10, AFC = $12, and quantity of birthday cakes produced a day is 20 . You conclude that the bakery ends up at the end of the day with a
a. loss of $10
b. profit of $10
c. loss of $20
d. profit of $40
e. loss of $40
E
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The Federal Reserve discount rate is the rate of interest charged on loans from ________ to ________.
A. the U.S. Treasury; commercial banks B. commercial banks; the Federal Reserve C. the Federal Reserve; commercial banks D. the Federal Reserve; the U.S. Treasury
Based on the idea of opportunity cost, which of the following students would be most likely to drop out of college before completing their degree?
a. a senior mathematics major with a solid B average b. a junior physical therapy student who has just read about the fantastic job offers available to students with degrees in her area c. a star college football player in his junior year that just received a $5 million offer from a professional team d. a junior economics major who wants to attend graduate school
Which of the following is most likely to help promote the efficient use of resources and rapid economic growth?
What will be an ideal response?
Suppose a new contracting environment that requires less specialized investments is considered. This new contract will result in:
A. a decrease in the marginal benefit and a longer optimal contract. B. an increase in the marginal benefit and a longer optimal contract. C. an increase in the marginal benefit and a shorter optimal contract. D. a decrease in the marginal benefit and a shorter optimal contract.