Korie wants to start her own business making custom furniture. She can purchase a factory that costs $400,000 . Korie currently has $500,000 in the bank earning 3 percent interest per year. If Korie purchases the factory with her own money, what is the annual implicit opportunity cost of purchasing the factory?
a. $0
b. $3,000
c. $12,000
d. $15,000
c
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One reason that international trade is restricted is that
A) the individual gain to parties who benefit from the protection is much larger than the individual loss to parties who lose. B) the government completely pays the losers from international trade for their losses. C) protectionism benefits consumers. D) the government cannot measure the cost of protectionism.
In the balance of payments, a deficit item is any transaction
A) that leads to a receipt by a resident of a country or its government. B) that leads to a payment by a resident of a country or its government. C) that is an export of a good or service. D) that makes residents of a country worse off.
An increase in market supply will increase price
Indicate whether the statement is true or false
Shane just received a pay raise. Which of the following actions would be an example of the substitution effect on labor?
a. deciding to work extra hours b. deciding to spend more time on leisure c. deciding to purchase more expensive brands d. deciding to save more money for retirement