Refer to Table 7.1 below. By what percentage does real annual expenditures in public elementary and secondary schools rise between 1980 and 1985? Between 2005 and 2010? What can be said about the rate of change?
Between 1980 and 1985 expenditures increased by 11.44%. Between 2005 and 2010,
expenditures rose by 7.6%. It is clear that real spending on education has fallen dramatically.
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Consider a typical individual who owns the following financial instruments: A life insurance policy for $250,000; a certificate of deposit for $10,000; homeowner's and auto insurance policies; $50,000 in a mutual fund, and $150,000 in her pension fund at work. Which of these are instruments used primarily as stores of value and which are being used to transfer risk?
What will be an ideal response?
Output (Q)Total Fixed CostTotal Variable Cost020012052207320104201552021Table 9.1Table 9.1 shows the cost structure of a firm in a perfectly competitive market. If the market price is $5:
A. the firm suffers a loss but is better off producing at the output where MR = MC. B. the firm suffers a loss and is better off shutting down. C. the market price is lower than its marginal cost at the profit maximizing output level. D. the market price is lower than the average variable cost at the profit maximizing output level.
Tommy's Teddy Bears incurs $300,000 per year in explicit costs and $50,000 in implicit costs. The shop earns $600,000 in revenues and has $1.1 million in net worth. Based on this information, what is accounting profit for Tommy's Teddy Bears?
A) $250,000 B) $300,000 C) $500,000 D) $1.35 million
An externality is
A. the total cost to society of producing an additional unit of a good or service. B. the amount a consumer pays to consume an additional amount of a particular good. C. a cost or benefit resulting from some activity or transaction that is imposed or bestowed on parties outside the activity or transaction. D. a problem intrinsic to public goods: The good or service is so costly that its provision generally does not depend on whether or not any single person pays.