What type of policy does the government adopt in dealing with government-inhibited goods?
A) It subsidizes their consumption.
B) It subsidizes their production.
C) It provides them as public goods.
D) It taxes, regulates, or prohibits their use.
D
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The U.S. dollar appreciates against the euro. What is the impact on aggregate expenditures and income?
A) Both increase. B) Both decrease. C) Aggregate expenditure increases and income decreases. D) Aggregate expenditure decreases and income increases.
Why does the price level in a perfectly competitive market move toward the zero-profit point?
a. Because firms enter and exit the market in response to gains and losses b. Because short-run losses reverse the effects of long-run gains c. Because profitable firms increase short-run productivity d. Because firms operate below the average cost curve
A belief that high-tech companies would be highly profitable led to the boom in Internet companies in the 1990s, which is known as a(n):
a. investment shock. b. investment boom. c. technology surge. d. technology reversal.
Suppose a firm has an annual budget of $200,000 in wages and salaries, $75,000 in materials, $30,000 in new equipment, $20,000 in rented property, and $35,000 in interest costs on capital. The owner/manager does not choose to pay himself, but he could receive income of $90,000 by working elsewhere. The firm earns revenues of $360,000 per year. What are the annual explicit costs for the firm described above?
A. $160,000. B. $360,000. C. $450,000. D. $90,000.