Economic profits are equal to
A) total revenues minus total fixed costs.
B) total revenues, after tax, minus cost of goods sold.
C) total revenues minus the implicit and explicit costs of all inputs used.
D) total revenues minus the opportunity cost of labor.
C
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The table above gives data for the nation of Pearl, a small island in the South Pacific. The economy is at full employment when real GDP is
A) $31 billion. B) $34 billion. C) $28 billion. D) $22 billion. E) $25 billion.
These are the cost and revenue curves associated with a firm.
Assuming the firm in the graph shown is producing Q1 and charging P3, it is likely showing the cost and revenue curves of a monopolistically competitive firm that is:
A. earning zero economic profits. B. earning positive economic profits. C. It is impossible to tell from the graph provided. D. earning negative economic profits.
The marginal product of labor
A. measures how output changes as the wage rate changes. B. is negative when adding another unit of labor decreases output. C. is less than the average product of labor when the average product of labor is decreasing. D. both a and b E. both b and c
The size of the multiplier associated with an initial increase in spending will be:
A. the same whether or not inflation occurs. B. diminished if inflation occurs. C. zero if any increase in the price level occurs. D. enhanced if inflation occurs.