If the interest rate is 1 percent and a business pays $100,000 for a lease on a factory, the explicit costs are
A) $110,000.
B) $100,000.
C) $10,000.
D) $90,000.
Answer: C
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A machine cost $15,000 to install, and has a resale value one year later of $12,000. If the real interest rate is 10%, then the user cost of capital is ________
A) $4,500 B) $1,500 C) $3,000 D) $1,200
A tax on buyers will shift the
a. demand curve upward by the amount of the tax. b. demand curve downward by the amount of the tax. c. supply curve upward by the amount of the tax. d. supply curve downward by the amount of the tax.
When all market participants are price takers who have no influence over prices, the markets have
a. only a few buyers and sellers. b. numerous sellers but only a few buyers. c. numerous buyers but only a few sellers. d. numerous buyers and sellers.
The basic task of economics is to
What will be an ideal response?