The idea that the Lorenz curve should be along the 45 degree line is consistent with
A) the productivity standard.
B) the egalitarian principle.
C) the conservative principle.
D) none of the above.
B
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The M1 definition of the money supply includes currency,
a. checkable deposits, and savings accounts. b. checkable deposits, and credit cards. c. checkable deposits, and debit cards. d. and checkable deposits.
A picture frame company operates in a competitive price-searcher market. Its short-run equilibrium price is $80 and its ATC is $65 . It sells 100 picture frames a week. From this we can conclude
a. this firm is making a normal profit. b. other picture frame companies will want to exit the market. c. there are no other picture frame companies in the area. d. economic profits are $1,500. e. total profits are being maximized.
Sebastian decides to open a tree farm. When deciding to open his own business, he turned down two separate job offers of $25,000 and $30,000 and withdrew $20,000 from his savings. Sebastian's savings account paid 3 percent interest. He also borrowed $20,000 from his brother, whom he pays 2 percent interest per year. He spent $15,000 to purchase supplies and earned $50,000 in revenue during his
first year. What are Sebastian's implicit costs from running his own business? a. $30,600 b. $55,600 c. $50,000 d. $75,600
An economic model:
A. exactly explains what happens in the real economy. B. approximates all facets of what happens in the real economy. C. does not make clear assumptions about the economic activity. D. discards unnecessary details to clearly demonstrate the central principles of the economic activity.