Owners of proprietorships
A. must pay the corporate profits tax.
B. are not subject to paying any taxes on their firms' income.
C. must pay the corporate profits tax as well as report their firms' income directly on their individual income tax returns.
D. report their firms' income directly on their individual income tax returns.
Answer: D
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For a bank, the ration of after-tax profit to assets is its:
A) net interest margin. B) return on assets. C) return on equity. D) spread.
Initially, the nominal rate of interest is 8 percent and inflation is 4 percent. The nominal interest rate then rises to 12 percent and the inflation rate to 8 percent. It follows that the real rate of interest has
a. fallen. b. remained the same. c. risen to 8 percent. d. risen to 10 percent.
The economic inefficiencies of monopolistic competition may be offset by the fact that:
A. advertising expenditures shift the average cost curve upward. B. available capacity is fully utilized. C. resources are optimally allocated to the production of the product. D. consumers have increased product variety.
The WWQX Co sells shirts. Shirts with the company label on the tag are perceived to be of higher quality than shirts with the store's label. Yet, shirts are of identical quality regardless of the label. The demand for perceived high-quality shirts is ph = 80 - qh. The demand for perceived low-quality shirts is pl = 19 + ph - ql. The firm can produce shirts at TC = 2qh + 2ql. What is WWQX Co total
profit? A) $2,362 B) $1,521 C) $2,518 D) $1,875