You borrow $10,000 at an interest rate of 5% to open Movies Galore, a DVD rental store. You will earn an economic profit if the return on your investment is
A. between 0 and 5%.
B. 5%.
C. greater than 5%.
D. only greater than 10%.
Answer: C
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In monopolistic competition, each firm supplies a ________ part of the total market output and its actions ________ the actions of the other firms
A) small; do not directly affect B) small; directly affect C) large; do not directly affect D) large; directly affect
The inflation rate is a:
a. percentage decrease in price level. b. percentage increase in price level. c. sustained increase in relative prices. d. sustained decrease in relative prices. e. sudden increase in the weighted average of all prices.
Which one of the following are the components of aggregate expenditure?
a. household consumption, business investment, government spending for goods and services, and net exports b. household consumption, business investment, government transfer payments, and net exports c. household consumption, business investment, government spending for goods and services, and exports d. household consumption, business investment, government spending for goods and services, and saving e. household consumption, business inventories, government spending for goods and services, and net exports
For a simple economy (no government, no foreign sector), the condition for equilibrium can be stated correctly as
A. saving equals actual investment. B. saving equals inventory accumulation. C. saving equals planned investment. D. inventory accumulation equals planned investment.