Which of the following correctly describes the marginal rate of return on capital?
a. The marginal rate of return equals the marginal product of capital multiplied by the marginal revenue product of capital.
b. The marginal resource cost of capital expressed as a percentage of its marginal revenue product.
c. The marginal revenue product of capital expressed as a percentage of its marginal cost.
d. The marginal rate of return equals the marginal product of capital added to the marginal revenue product of capital.
c
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Which of the following will be included in the current year's gross domestic product (GDP)?
a. The sale price of equipment produced last year but sold this year b. The money spent by Kate on the purchase of new furniture c. The money spent by Barney on the purchase of his uncle's house d. The sale price of the stock purchased by John e. The opportunity cost of the time spent by Bruno cooking lunch for his neighbor
If price is less than average total cost, a firm
a. earns an economic profit b. hires additional workers c. moves its factory offshore d. fires the marginal worker e. suffers an economic loss
Why are resources considered limited?
A. Entrepreneurs do not invest enough of them. B. There are not enough available so that everyone can have as much of them as desired. C. Everyone has them, and they change. D. There are so many that people must decide which ones to choose at any on
In a production possibilities frontier graph, the cost of producing more units of a good is measured by the
A. dollar value of the resources used to produce the good. B. amount of the other good or service that must be forgone. C. dollar value of the additional output. D. area in the arc between the PPF and a straight line drawn between the starting point and the ending point. E. None of these answers is correct.