Production costs to an economist:
A. consist only of explicit costs.
B. reflect opportunity costs.
C. never reflect monetary outlays.
D. always reflect monetary outlays.
Answer: B
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Money costs and opportunity costs are concepts that are
A. not related in any meaningful way. B. used by tax accountants. C. related through the relative prices of goods and services. D. used by economists to learn the most efficient level of output.
Skills, talents, and abilities that people possess can be categorized best as:
a. Human resources b. Tangible resources c. Capital resources d. Financial resources
One reason why it is difficult to regulate a natural monopoly is
a. the lack of relevant economic theory b. determining what price the firm is actually charging its customers c. determining the appropriate side payment d. an information problem — the monopoly's managers have an incentive to overstate costs e. an information problem — the monopoly's managers have an incentive to overstate revenues
Refer to Exhibit 9.2, which shows the cost and revenue curves faced by a monopolist. The demand curve faced by the monopolist at the profit-maximizing output is _____
A) perfectly price elastic.
B) price elastic.
C) price inelastic.
D) unit price elastic.
E) perfectly price inelastic.