On an afternoon that a class meets, you could alternatively study for an exam that will take place in another class the next morning, go to a movie with a friend, or, most desirable to you at present, take a nap. The opportunity cost of attending the afternoon class is
A. missing seeing the movie with your friend.
B. forgoing the nap.
C. giving up the time to study for the next morning's exam.
D. being unable to engage in all three of the above activities.
Answer: B
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Consider the above figure. This curve suggests that as the government raises the tax rate, a point will eventually be reached at which the revenues that are collected will
A) increase. B) decline. C) approach infinity. D) become negative.
James used $200,000 from his savings account that paid an annual interest of 10% to purchase a hardware store. After one year, James sold the business for 300,000 . His economic profit is:
a. $300,000 b. $100,000 c. $80,000 d. $20,000
According to an economist, which of the following would be an example of investment spending?
a. A firm spending $8 million for the maintenance of 50 recreational parks across its home country b. An individual buying $1 million of stock in a leading software company c. An individual spending $0.5 million in government bonds d. A firm spending $10 million to purchase a new factory
By purchasing shares in a mutual fund that holds a portfolio of stocks, a person can
a. benefit from fundamental analysis, since the mutual fund requires its shareholders to perform fundamental analysis on their own. b. benefit from fundamental analysis, since the mutual fund hires one or more individuals to perform fundamental analysis for the fund. c. eliminate market risk. d. reduce the standard deviation of his or her portfolio to zero.