If the market for maple syrup is perfectly competitive, then in the long-run equilibrium, firms are
A) entering the market.
B) exiting the market.
C) making zero economic profit.
D) temporarily shutting down.
C
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Which of the following correctly highlights a limitation of applying simultaneous equation models to time series data?
A. Most time series have variables with a unit root and 2SLS is complicated when applied to equations with such variables. B. 2SLS estimates are inefficient when applied to variables that are not in their levels but in first differences. C. It is difficult to form simultaneous equations which satisfy the rank and order conditions using time series data. D. The problem of serial correlation greatly limits the efficiency of simultaneous equation models and leads to inefficient estimations.
Tomas quit his job at the Tri-City bank where he earned $50,000 a year to start his own businesses, a bank marketing company. He estimates his entrepreneurial talent or forgone entrepreneurial income to be $5,000 a year. He used $100,000 in savings
that earned 5 percent interest annually to finance the new business. In the first year, the firm earned revenue of $250,000. The costs for rent, supplies, and an employee’s salary were $200,000. What was the accounting profit for the new business? What was the economic profit (or loss)? Explain your calculations for both questions. Please provide the best answer for the statement.
If the social costs of an economic activity are $200 and the private costs are $200, then the external costs of the activity are ________, and market failure ________.
A. $0; does not occur B. $400; occurs C. $400; does not occur D. $0; occurs
Workers are demanded and supplied in the
A. money market. B. labor market. C. transfer market. D. goods and services market.