Economic profits are:
A. Always larger than accounting profits
B. The sum of accounting profits and implicit costs
C. Equal to the difference between total revenues and implicit costs
D. Equal to the difference between accounting profits and implicit costs
D. Equal to the difference between accounting profits and implicit costs
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If the marginal cost of a perfectly competitive firm producing a good is $50 and the market price of the good is $100, the firm should:
A) decrease its output. B) increase its output. C) try to increase the market price. D) try to decrease the market price.
Why is a point below the production possibilities curve less efficient than a point on that curve?
What will be an ideal response?
If labor is the only variable input, an increase in the quantity of labor:
a. does not have any effect on the quantity of output. b. causes the output to increase initially at a diminishing rate and then at an increasing rate. c. causes the output to increase at a constant rate till the last worker is hired. d. causes the output to increase initially at an increasing rate and then at a decreasing rate. e. causes the output to decrease at a constant rate till the last worker is hired.
Which of the following is an example of a scarce good?
What will be an ideal response?