Ellie has been working for an engineering firm and earning an annual salary of $80,000 . She decides to open her own engineering business. Her annual expenses will include $15,000 for office rent, $3,000 for equipment rental, $1,000 for supplies, $1,200 for utilities, and a $35,000 salary for a secretary/bookkeeper. Ellie will cover her start-up expenses by cashing in a $20,000 certificate of
deposit on which she was earning annual interest of $500 . According to an economist, which of the following revenue totals will yield Ellie's business $50,000 in economic profits?
a. $55,200
b. $100,200
c. $132,500
d. $185,700
d
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A monopolist's profit maximizing price is $15 . At MC=MR, the output is 100 units and the MC is $10 . At this level of production, average total costs are $12 . Monopolist's profits are
a. $300 b. $1500 c. $500 d. None of the above
What is not an effect of deregulation in the airline and trucking industries?
A. Lower prices of many services B. Increased entry of new firms into deregulated industries C. Lower income to unions working in deregulated industries D. Improvements in the quality of services
In this graph, why does point B move up to point C?
a. In the short run, the increase in money supply leads to a higher price level, which causes the interest rate to lower.
b. In the long run, the increase in money supply leads to a lower price level, which causes the interest rate to rise.
c. In the short run, the increase in money supply has little effect on price level, which causes the interest rate to lower.
d. In the long run, the increase in money supply leads to a higher price level, which causes the interest rate to rise.
Fannie Mae and Freddie Mac both
A) sell bonds to investors and use the funds to purchase mortgages. B) help regulate the banking system. C) directly lend funds to people seeking mortgages. D) reduce access to funds for mortgages by purchasing existing mortgages.