Refer to Figure 17.3. Assume X units of plants and equipment wear out each year. What will happen to the PPC in the future if the economy currently produces at point Z?
A. It will shift outward.
B. It will stay the same.
C. It will shift inward.
D. This cannot be determined with the information given.
Answer: C
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Answer the next question based on the following demand and cost data faced by a pure monopoly.Demand DataCost DataPriceQuantity DemandedOutputTotal Cost$2.7533$4.002.50444.502.25554.752.00665.751.75777.75At equilibrium, the pure monopoly will generate_____.
A. an economic profit of $6.50 B. an economic profit of $10 C. a loss of $7.25 D. an economic profit of $4.50
Why is gold very expensive, even though it is not essential to life, while water, which is essential to life, is inexpensive?
What will be an ideal response?
Jimmy is very excited about the costume party with a 1990s theme. He is planning to dress up as MC Hammer but is also considering going as a lifeguard from Baywatch. His opportunity cost of arriving dressed like MC Hammer is:
A. the cost of parachute pants that MC Hammer would wear. B. the savings from not purchasing red swimming trunks. C. giving up the alternative of dressing like a lifeguard. D. there is no opportunity cost because he attended the party either way.
A payment for a resource above the opportunity cost of the resource is
A. nominal rent. B. economic rent. C. real rent. D. social rent.