You overhear the following in the hallway, "Everyone eventually dies, so how can a life insurance company make a profit? Isn't it a losing battle? You will always have to pay the death benefit to your clients!" You know that life insurance compa
can be profitable. This is because A) the premiums you pay on a life insurance policy are always more than any death benefit, so the insurance company always comes out ahead.
B) older people with a greater probability of dying during the term of a policy are denied any death benefits.
C) the insurance company collects more than enough in premiums today to cover expected benefits payable today.
D) life insurance companies are notorious for cheating clients with "fine print" policy clauses.
C
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If total government tax collections equal $100 billion, transfer payments equal $50 billion, and government interest payments equal $5 billion, then net taxes equal:
A. $105 billion. B. $45 billion. C. $55 billion. D. $155 billion.
Refer to Figure 12-5. If the market price is $20, what is the firm's profit-maximizing output?
A) 750 units B) 1,100 units C) 1,350 units D) 1,800 units
The marginal revenue product
A) represents the incremental contribution to the firm's total revenues obtained from an increase in a variable input. B) always increases when there is an increase in a variable input. C) gives the increase in cost when there is an increase in a variable input. D) gives the change in total product when an additional unit of a good is hired.
Look in your wallet. Your credit cards are
a. M1 money b. M2 and fiat money c. fiat money d. near money e. not money