Which of the following is most likely to be an implicit cost for Company X?
A. Forgone rent from the building owned and used by Company X.
B. Rental payments on IBM equipment.
C. Payments for raw materials purchased from Company Y.
D. Transportation costs paid to a nearby trucking firm.
Answer: A
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What is economics?
a. study the market changes b. study money c. study how to efficiently allocate scarce resources to maximize societal goals. d. study recession and boom e. study supply and demand
Tacit collusion among firms does not involve explicit agreements on pricing and output levels
a. True b. False
Given the following formula for the Taylor rule:Target federal funds rate = natural rate of interest + current inflation + 1/2(inflation gap) +1/2(output gap) if the current rate of inflation is 4%, natural rate of interest is 2%, and the target rate of inflation is 2%, and output is 3% above its potential, the target federal funds rate would be:
A. 4.5%. B. 7%. C. 8.5%. D. 5%.
Using a graph, explain how an increase in technology will affect the equilibrium price and quantity of DVD players. Again using a graph, explain what happens in the market for video cassette recorders.
What will be an ideal response?