If economic profits are $100,000 and implicit (or opportunity) costs are $60,000, how much are accounting profits?
What will be an ideal response?
Economic profit ($100,000) + Implicit costs ($60,000) = Accounting profit ($160,000).
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Arbitrage
A) is the act of buying an item at a low price and reselling the item at a higher price. B) is the act of selling an item on consignment and collecting a huge portion of the proceeds to compensate for the seller's time. C) is any act of buying and selling that results in the seller earning an above normal profit. D) is the act of buying an item at a low price, bundling it with another and selling the new package at a much higher price.
From what viewpoint is a sales tax most likely to be considered regressive?
a. If one considers lifetime consumption as equal to income. b. If one considers that many goods consume by low-income individuals are exempt from taxation. c. If one considers it as a consumption tax on current income. d. If one considers it as equal to a tax on wealth.
The accompanying figure shows a single consumer's demand for ice cream at the student union.
Fran is one of the students whose demand curve for ice cream is shown above. When price is $4.00, Fran demands ________ scoops a week, and when price is $2.00, Fran demand ________ scoops.
A. 2; 6 B. 2; 4 C. 1; 3 D. 2; 5
What economists call the law of one price depends on:
A. the inertia effect. B. people seeking to exploit profit opportunities. C. government action. D. random chance.