What best explains the difference between the two graphs in the Accounting Profits versus Economic Profits table?
a. Accounting profits are smaller than economic profits because they factor in explicit costs.
b. Economic profits are smaller than accounting profits because they factor in implicit costs.
c. Economic profits are smaller than accounting profits because they do not factor in implicit costs.
d. Accounting profits are smaller than economic profits because they do not factor in explicit costs.
b. Economic profits are smaller than accounting profits because they factor in implicit costs.
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In the simple deposit expansion model, if the banking system has excess reserves of $75, and the required reserve ratio is 20%, the potential expansion of checkable deposits is
A) $75. B) $750. C) $37.50. D) $375.
Over the twentieth century, growth in per-capita GNP was highest
A) immediately prior to the Great Depression. B) during World War II. C) during the 1960s. D) during the 1980s.
Jennifer is the only employee of her sole proprietorship. She is entertaining the idea of hiring an additional employee. She knows that on her own she can produce 100 units per day
Jennifer figures that Applicant A will help her produce 175 units per day whereas Applicant B will help her produce 155 units per day. Which of the following statements is most accurate? A) Applicant B has a marginal product of 75 units. B) Applicant B has an average product of 77.5 units. C) Applicant A has a marginal product of 75 units. D) Applicant A has an average product of 87.5 units.
An open-access good is often subject to which of the following problems?
a. Limited entry and restrictive harvest regulations b. High levels of economic rent c. The common-pool problem d. Government regulation