An example of an implicit cost is:
A. the value of a spare bedroom turned into a home office.
B. wages paid to a family member who works at the firm.
C. operating costs of a company-owned car.
D. interest paid on a bank loan used to purchases equipment.
Answer: A
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The utility a consumer derives from knowing that others receive benefit from an environmental good is called
a. stewardship value c. direct user value b. indirect user value d. vicarious consumption
The amount earned by owners of the nation's factors of production is
A) total income. B) private and government transfer payments. C) the wages and fringe benefits received by the nation's workers. D) all profits received by businesses.
Which of the following is NOT a reason the Fed alters the rate of growth of the money supply?
A) to influence aggregate demand B) to influence the amount of consumption C) to influence the amount of investment D) to shift the demand for money curve
Consider a small open economy in equilibrium with a zero current account balance. What happens to national saving, investment, and the current account balance in equilibrium if
(a) future income rises? (b) business taxes rise? (c) government expenditures decline temporarily? (d) the future marginal product of capital rises?