Joe runs a restaurant. He pays his employees $200,000 per year. His ingredients cost him $50,000 per year. Prior to running his restaurant, Joe was a lawyer earning $150,000 per year. What would economists say is Joe's cost of running the restaurant?
A. $150,000
B. $200,000
C. $250,000
D. $400,000
Answer: D
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Based on the Saving-Investment Diagram, if the difference between values G and E measures the net capital outflow, then ________
A) the difference between values G and E measures the trade surplus B) the difference between values H and D measures the trade surplus C) the domestic real interest rate is indicated by B D) desired saving has decreased E) none of the above
The monopoly can shift the demand for its product rightward by
A) accommodating entry. B) advertising new uses for its product. C) moving along the learning curve. D) All of the above.
All of the following shift the labor demand curve EXCEPT changes in
A) fringe benefits offered to employees. B) the demand for the final product. C) labor productivity. D) prices of related factors.
The spending multiplier is defined as:
a. the ratio of the change in equilibrium real GDP to the initial change in spending. b. the change in initial spending divided by the change in personal income. c. 1 / (marginal propensity to consume). d. 1 / (1 ? marginal propensity to save).