Which of the following equations is CORRECT?
A. accounting profit = total revenue - (explicit costs + implicit costs)
B. economic profit = accounting profit - explicit costs
C. normal profit = accounting profit + economic profit
D. economic profit = accounting profit - implicit costs
Answer: D
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The long-run aggregate supply curve will shift outward to the right when
A) the price level decreases. B) the real-balance effect increases. C) there is economic growth. D) the amount of labor decreases.
Which of the following statements is true?
A) If a bank lends a sum of $600 to a firm, the sum is a part of the bank's liability. B) If a bank lends a sum of $200 to a household, the sum is a part of the bank's liability. C) If a firm deposits a sum of $500 in a bank, the sum is a part of the bank's assets. D) If a firm deposits a sum of $500 in a bank, the sum is a part of the bank's liability.
If marginal costs rises above average costs, average costs must
a. Be increasing b. Be decreasing c. Stay constant d. None of the above
Refer to the figure shown, which represents the production possibilities frontiers for Countries A and B. The slope of Country A's production possibilities frontier:
A. measures the opportunity cost of trucks in terms of cars.
B. measures the trade-off that Country A face when deciding how to allocate resources.
C. is constant because the opportunity cost remains constant.
D. All of these statements are true.