Bill is an economics professor who earns $40,000 teaching but decides to leave and fulfill his dream of catering barbecues. During his first year of barbecuing he earned total revenue of $60,000. He spent $30,000 on food and supplies
He also paid his wife $10,000 to help serve food. The normal profit for an entrepreneur running a barbecue business is $3,000. He also rented an industrial grill/fry truck for $12,000. An accountant would conclude that Bill's profit was A) $30,000.
B) $20,000.
C) $8,000.
D) -$2,000.
E) $40,000.
C
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If the Fed is concerned about a possible recession, it ________ the federal funds rate and, in response, long-term interest rates ________ by a ________ amount than the change in short-term rates
A) raises; increase; larger B) lowers; increase; smaller C) raises; decrease; larger D) lowers; decrease; smaller E) raises; increase; smaller
Credit cards
a. are considered money because they are a means of payment b. are not considered money and thus are not of importance to the monetary authority c. are not considered money but are important because they may affect how much people hold in M1 and M2 d. are counted in the money supply as part of M3 e. are considered money when held by the public
Insurance companies:
A. only profit by selling to risk neutral clients. B. profit from the difference between the premiums paid and the expected value of clients' payouts. C. must charge less than the expected value of payout, otherwise they would go out of business. D. All of these statements are true.
In 2011, which category represented the largest category of spending for the U.S. federal government?
a. health b. income security c. national defense d. net interest