A minor, but important reason, for using non-market transactions is that:
A. buying in the market is just too complicated.
B. it makes sure there is proper motivation of production efficiency.
C. it avoids sharing proprietary information with other firms.
D. all inputs are available in adequate supply in the market.
Answer: C
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If the interest rate is 7% and the tax rate is 15%, what is the after -tax cost of capital for the firm?
What will be an ideal response?
If a hurricane were to wipe out the majority of the eastern seaboard in the United States, it would likely cause a:
A. short-run supply shock. B. long-run supply shock. C. long-run demand shock. D. short-run demand shock.
What phrase do economists use to describe the assumption that everything else about a situation stays the same, allowing only one variable, such as price, to change?
A. Caveat emptor B. Vini, vidi, vici C. Ceteris paribus D. E pluribus unum
Suppose the equilibrium quantity of labor hired decreases and the equilibrium real wage rate increases. All else constant, this situation will also result in
A) more government outlay for the unemployed. B) higher output prices. C) lower output prices. D) fewer benefits for those still unemployed.