Assume Brad worked as a contractor for a year and had revenues of $120,000 and explicit cost of $70,000 . If he could have been paid $80,000 working for a computer company, his:
a. accounting profit equaled $10,000 and he would be rational to stop working as a contractor.
b. accounting profit equaled $50,000 and he would be rational to continue working as a contractor.
c. economic profit equaled $50,000 and he would be rational to continue working as a contractor.
d. economic profit equaled -$30,000 and he would be rational to stop working as a contractor.
d
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Governments can discourage consumption of certain goods by:
A. a subsidy to consumers in those markets. B. taxing substitute goods. C. imposing a minimum price above the equilibrium price. D. None of these policies decrease consumption of goods.
Which of the following is not true regarding the argument for protection as a way of maintaining jobs and wage levels?
a. Wages may be only a small fraction of total production costs. b. High wages do not necessarily imply high labor costs when productivity is taken into account. c. U.S. workers are among the most productive in the world partly because they are well educated and trained compared to other countries. d. U.S. workers are highly productive partly because they are provided with abundant supplies of machines and physical capital. e. It is not possible that the U.S. wages, even when supported by high U.S. output per worker, can render U.S. products competitive with low-wage countries.
Which of the following statements are CORRECT?
I. The average economic growth rate in real GDP per person in the United States over the last century was 5 percent per year II. The United States has the highest economic growth rate of any nation. A. II only B. neither I nor II C. both I and II D. I only
What does market power refer to?
a) the side effects that may occur in a market b) the government regulations imposed on the sellers in a market c) the ability to influence price d) the forces of supply and demand in determining equilibrium price