Explain what is necessary if a business is to earn economic profits.
What will be an ideal response?
To earn economic profits, a business must see opportunities that others have missed, discover new products, find new and better methods of production, or take above-average risks.
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If a nation has a(n) _____ in the production of an item, it can produce _____ of the item with the same quantity of resources than can other nations.
A. absolute advantage; more B. mutual gain; the same amount C. special advantage; more D. comparative advantage; more
Econometrics is the use of statistics to quantify and test economic models
Indicate whether the statement is true or false
In the long run, the Fed can change the inflation rate but not the unemployment rate
a. True b. False
During the 2000 to 2006 time period, housing prices increased but only to a limited degree
a. True b. False Indicate whether the statement is true or false