What are the major sources of economic profit?
a. certainty, monopolistic competition, and inelastic supply.
b. competition, perfect information, and elasticity of market demand.
c. barriers to entry, uncertainty, and entrepreneurial alertness.
d. externalities, inflation, and size of firm.
C
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From a firm's viewpoint, opportunity cost is the
A) best alternative use customers can find for the firm's output. B) cost the firm must pay for the factors of production it employs to attract them from their best alternative use. C) accounting cost of resources. D) price a firm can charge for its output. E) cost of acquiring the opportunity to sell to its customers.
Critics of real business cycle theory doubt the plausibility of ________
A) intertemporal substitution B) negative productivity shocks C) adaptive expectations D) a trade-off between work and leisure
The statement that "at 10 percent, the interest rate is too high for families to buy a home they could have afforded when the interest rate was below 7 percent ," is a(n)
a. positive statement b. normative statement c. morally ambiguous philosophical position d. affront to the American dream e. value judgment
An inverted yield curve is a valuable forecasting tool because:
A. investors are expecting higher short-term rates in the future, and this usually signals an economic slowdown. B. inverted yield curves signal better economic times are expected. C. the yield curve usually is inverted so it reflects a growing economy. D. the yield curve seldom is inverted and can signal an economic slowdown.