Depreciation is
A. added to national income to get GDP.
B. subtracted from national income to get GDP.
C. added to GNP to get NNP.
D. subtracted from GNP to get NNP.
Answer: D
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The utility function captures
A) how consumers interact. B) how an individual consumer ranks consumption bundles. C) how output is produced from labor and capital inputs. D) how happy a consumer is about a given consumption bundle.
Bonnie is debating whether to take a job as a professional therapist or a florist. She will earn $40,000 a year as a therapist or $30,000 a year as a florist. If she chooses to be a therapist, the opportunity cost is
A) $40,000. B) $30,000. C) $10,000. D) unable to determine.
When there are economies of scope between two products which are separately produced by two firms, merging into a single firm can:
A. lead to a reduction in sales. B. accomplish a reduction in costs. C. lead to an increase in cost. D. accomplish an increase in sales.
An In the News article is titled "Study Finds Net Gain from Pollution Rules." The optimal amount of pollution, from an economic perspective,
A. Occurs where the price equals the social marginal revenue. B. Is zero pollution. C. Occurs where the social marginal benefit of pollution control equals the social marginal cost. D. Is the rate that reduces pollution costs but does not result in externalities.