Economic profits are:
A. total revenue minus total opportunity cost.
B. marginal revenue minus marginal cost.
C. total revenue minus total cost.
D. total profits of the economy as a whole.
Answer: A
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What is a reference point?
A) the value of a good on the black market B) the point from which an individual makes a consumption decision C) a subjective valuation of a good D) the minimum price that an individual would sell a good that she currently owns E) none of the above
Because financial markets clear, we know that leakages in the economy will equal injections and, therefore, there will be enough spending in the economy to purchase whatever amount of output level produced
a. True b. False
You can either read a book, get something to eat, or take a nap. The opportunity cost of getting something to eat is _____
a. the cost of what you eat. b. the difference between the costs of the book and the food. c. the difference between the opportunity costs of reading and sleeping. d. the net benefit of sleeping. e. impossible to determine because the most preferred alternative is not known.
The ________ is divided into two major accounts, the current account and the capital account.
A. GDP B. national debt C. balance of payments D. trade deficit