Compounding is:
A. the process of deposits steadily increasing a set amount annually.
B. the process of accumulation of additional interest paid on interest that has already been earned.
C. the process of adding the percentage of interest times your initial principal yearly.
D. None of these statements is true.
Answer: B
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Suppose Aiyanna's Pizzeria currently faces a linear demand curve and is charging a very high price per pizza and doing very little business. Aiyanna now decides to lower pizza prices by 5% per week for an indefinite period of time. We can expect that each successive week
A. demand will become less price elastic. B. the elasticity of supply will increase. C. price elasticity of demand will not change as price is lowered. D. demand will become more price elastic.
Which of the following is NOT a popular stock market index?
A) Dow Jones Industrial Average B) NASDAQ C) S&P 500 D) Moody's Market Index
Alan Jones owns a company that sells life insurance. When he employs 10 salespersons his firm sells $200,000 worth of contracts per week, and when he employs 11 salespersons, total revenue is $210,000 . The marginal revenue product of the 11th salesperson is:
a. $20,000. b. $410,000. c. $210,000. d. $10,000.
If the long-run supply curve is upward sloping, we know that
A. some input prices are increasing as the industry expands. B. the law of diminishing marginal returns has set in. C. entrepreneurs are earning higher profits as output expands. D. firms are getting larger as the industry contracts.