One reason that professional baseball players earn higher incomes than college professors is that:
A. the training costs to enter the baseball profession are low.
B. there no barriers to entry in the baseball profession.
C. few people have the skill to play professional baseball.
D. being a college professor requires less education.
Answer: C
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Adverse selection is created by
A) incentives to change behavior after two parties have reached an agreement. B) risk. C) lump-sum taxes. D) private information.
The turnpikes built in the early 1800s were
(a) intercity toll roads. (b) highly profitable enterprises. (c) financed entirely by private enterprise. (d) regulated by the federal government.
Refer to the above table. If opportunity costs are constant, then the opportunity cost of producing good B in country X is ________, and the opportunity cost of producing good B in country Y is ________
A) 1 unit of A; 2 units of A B) 1 unit of A; 0.5 unit of A C) 1 unit of B; 2 units of A D) 1 unit of A; 0.5 unit of B
Which of the following is not an explicit cost?
a. salaries b. sales taxes c. the cost of utilities, such as gas and electricity d. insurance premiums e. the value of a firm owner's time