A disadvantage of the proprietorship form of business organization is
A. that the owner must fight a lot of red tape to form the firm.
B. its limited liability.
C. that it can issue only one class of stock.
D. its limited access to capital.
Answer: D
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Resources are efficiently allocated when production occurs at that point at which
a. marginal cost intersects average variable cost b. price is equal to average revenue c. price is equal to marginal cost d. marginal revenue equals marginal cost e. price is equal to average variable cost
If a bank has $500 in excess reserves and the reserve requirement is 20 percent, then the maximum amount by which this individual bank can increase the money supply is _____
a. $100 b. $400 c. $500 d. $1,000 e. $2,500
You have just bought a used car, and drive away satisfied that you've made a good deal on the purchase. What would an economist say about your "gain" on the deal?
a. Your gain has clearly meant that the seller lost on the deal. b. The seller has clearly gained, and you have actually lost on the deal. c. Both you and the seller have gained something. d. If your gain is too large, then the deal should be re-negotiated. e. If the seller's loss is too large, then the deal should be re-negotiated.
The Gini coefficient provides a measure of
a. the level of poverty. b. the level of relative inequality. c. disguised unemployment. d. the rate of growth.