If the minimum efficient scale in toaster production is 500,000 units per year, the average cost of producing 300,000 toasters is greater than the average cost of producing 500,000
a. True
b. False
A
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A 5 percent tax is going to be applied to a $100,000 tax base. What can be said about the revenue collected assuming static tax analysis?
A) The total revenue will be zero. B) The total revenue will be between $0 and $5,000. C) The total revenue will be $5,000. D) There is not enough information to determine what revenues will equal.
Suppose a firm is considering the purchase of a machine which when used will increase its total revenues by $10,000 for the year. The machine costs $8,000 and has a useful life of one year. The interest rate is 20 percent. This investment should:
A. Be undertaken because the rate of return is 2 percent greater than the interest rate B. Be undertaken because the rate of return is 5 percent greater than the interest rate C. Be undertaken because the rate of return is 7 percent greater than the interest rate D. Not be undertaken because the rate of return is 7 percent less than the interest rate
Which of the following is not included in the balance of the financial account of the United States?
A) a purchase of GE stock by a firm in China B) a purchase of a German brewery by the U.S. company, Budweiser C) a purchase of Toyota stock by Ford D) a purchase of U.S. car manufacturing plant by Toyota E) a purchase of German legal services by Chase Manhattan Bank
Any change in a firm's fixed costs will change its profit-maximizing level of output
a. True b. False Indicate whether the statement is true or false