Sally leaves her $24,000 secretarial position with a company and invests her savings of $15,000 (on which she was earning 6 percent interest) in her own Ready Sec agency. After expenses, her net income was $28,900 . Her economic profit was
a. $4,900.
b. $4,000.
c. $28,900.
d. ?$10,100.
b
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If the government imposes a specific tax on a monopoly, the consumer's tax incidence
A) can exceed 100%. B) will always be between 0-100%. C) may be negative. D) will be the same as when the tax is imposed on a perfectly competitive firm.
A behavioral economist is asked to sum up her criticism of the traditional model of consumer theory in a single word. Which of the following words would she most likely choose?
a. foolish b. illogical c. oversimplified d. useless
Ameritech has a monopoly over local telephone service. If Ameritech is producing where marginal revenue is less than marginal cost, the firm
A. could increase profits by increasing output. B. is maximizing profits. C. could increase profits by reducing output. D. must be earning a zero profit.
As the baby boomers retire what happens in the labor market?
A. increases labor supply. B. decreases labor supply. C. decreases labor demand. D. increases labor demand.