Monetary costs and opportunity costs are always identical
a. True
b. False
Indicate whether the statement is true or false
False
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Hotelling's rule states that
a. The net price of a resource is constant b. The net price of a resource rises at a rate equal to the interest rate c. The net price of a resource declines at a rate equal to the interest rate d. The price of a resource depends on the allocation of property rights e. The price of a resource is efficient as long as all user costs are internalized
Economics is an empirical science, which means that economists
A. do only laboratory experiments. B. look at evidence to see whether or not the model is applicable. C. test their models by utilizing unknown variables. D. refuse to test their models since the usefulness of a model is determined by whether it is logical or not.
When x increases leading decrease in output, a better policy tool is
A) decrease in policy rate. B) increase in policy rate. C) increase in government spending. D) decrease in government spending.
A firm earns a profit if
A. price equals marginal cost. B. total revenue exceeds the total cost of production. C. price is less than the total cost of production. D. total revenue equals total fixed costs.