You borrow $40,000 at an interest rate of 5% to open Organic Foods, an all-natural food store. You will earn an economic profit if the return on your investment is
A. greater than 5%.
B. 10% or greater.
C. between 0 and 5%.
D. 5%.
Answer: A
You might also like to view...
The table above has information about the CPI, nominal wage rate, and nominal interest rate for the country of Syldavia for the years 2010 to 2012. The reference base year is 2010. The inflation rate in Syldavia from 2010 to 2011 was
A) 5.0 percent. B) -9.5 percent. C) 3.0 percent. D) 9.5 percent. E) -5.0 percent.
Why is the price elasticity of demand a relative measure? That is, why is elasticity measured in percentage terms rather than in absolute terms?
A) So the coefficient of elasticity will not be dependent on the physical units of the good. B) Because absolute measures do not account for the direction of the change in quantity. C) So that the coefficient of elasticity will not be negative. D) Because the absolute price or quantity demanded of a product is irrelevant to the elasticity measure.
A nation can gain from international trade when
a. its relative production costs are the same as those of other countries. b. it exports goods for which it is a low-opportunity cost producer while importing goods that it could produce only at a high opportunity cost. c. it imports goods for which it is a low-opportunity cost producer and exports goods for which it is a high opportunity cost producer. d. it has a trade deficit.
Which of the following is a factor of production?
A) an acre of forested land B) a U.S. Treasury bond C) 20 shares of Ford stock D) $25,000 in cash