If a firm's economic profit is positive, its accounting profit must also be positive
a. True
b. False
A
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What does the Classical model predict about the relationship between a country's budget balance (total revenue minus total spending) and a country's level of real interest rates and investment in a closed economy? Use a graph of the capital
market to illustrate.
Why doesn't a perfectly competitive firm charge a price slightly higher than the industry price in order to earn extra profit?
Which of the following would shift a market labor supply curve to the left?
a. a decrease in the price of output b. an increase in the price of output c. a labor-augmenting technological change d. better employment opportunities in a closely-related job
What will arise when negative externalities are present in a market?
a) Government will regulate the externalities in the market. b) Private costs will be greater than social costs. c) The market will not be able to reach any equilibrium situation. d) Social costs will be greater than private costs.