In the calculation of national income, dividends paid to stockholders are part of
A) compensation of employees.
B) proprietors' income.
C) rental income.
D) net interest.
E) corporate profits.
E
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Positive economics
a. postulates relationships among economic variables that are potentially refutable by real-world events. b. is strictly quantitative and is, therefore, of little value to policy makers. c. will usually indicate which economic policy is best. d. is the same as normative economics.
Local governments provide law enforcement, which benefits society, but if the costs of law enforcement exceed the benefits, the result is a situation of
A. Government failure. B. Efficiency as long as there is some benefit. C. Market failure. D. Public choice theory.
If Ewan is consuming his utility maximizing bundle and the price of one good falls, what happens to the marginal utility per dollar spent on this good (MU/P), and what should Ewan do?
A) MU/P has increased and Ewan should buy more of this good. B) MU/P has increased and Ewan should buy less of this good. C) MU/P has decreased and Ewan should buy more of this good. D) MU/P has decreased and Ewan should buy less of this good.
At the current level of output, a firm's marginal cost equals 16 and marginal revenue equals 10. The firm
A) is producing the profit-maximizing amount. B) should produce more. C) should produce less. D) Not enough information.