Refer to the circular-flow model in Exhibit 1.1. If A represents product markets, and D represents firms, then the flow from A to D is _____

a. revenue.
b. expenditures.
c. labor, capital, and natural resources.
d. goods and services.
e. wages, interest, rent, and profit. check image at top


Answer: a. revenue.

Economics

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Economic profits are calculated as:

A. total revenue minus explicit costs. B. total revenue minus all opportunity costs, explicit and implicit. C. total revenue minus implicit costs. D. None of these is true.

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Unit elastic demand occurs when

a. a one-unit increase in price leads to a one-unit decrease in quantity demanded b. a 1% increase in price leads to a one-unit decrease in quantity demanded c. price elasticity of demand is positive d. price elasticity of demand is exactly zero e. price elasticity of demand is exactly -1

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If a decrease in the price of good Y causes the demand for good Z to decrease, this indicates that:

a. Y and Z are complements. b. Y and Z are substitutes. c. Y and Z are unrelated. d. Y is a normal good and Z is an inferior good.

Economics

You save $10 on gas every week because you take the bus to school. You have class 5 days a week. What is your average benefit per day of taking the bus to school?

A. $0 B. $5 C. $2 D. $10

Economics