All of the following are surplus items in the balance of payments EXCEPT
A) purchases of foreign assets.
B) exports of merchandise.
C) foreign tourist expenditures.
D) funds deposited in this country by foreign residents.
Answer: A
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If MPC = 0.8 and the economy is in equilibrium $500 below full-employment equilibrium, how much should government spending change to achieve full employment?
a. ?100. b. +80. c. ?80. d. +500. e. +100.
What is tying or bundling of goods?
When a good is nonexcludable,
a. it is impossible or very costly to exclude nonpaying customers from receiving the good. b. individuals will have an incentive to become free riders. c. it will be difficult for a private firm producing the good to generate revenue sufficient to cover the cost of production. d. all of the above are true.
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 economic profit for Tommy's Teddy Bears?
A) $250,000 B) $300,000 C) $500,000 D) $1.35 million