Critics of the huge net returns on, for example, oil production will claim that the returns are
A. interest on the capital investment.
B. rents on a natural resource.
C. profits on entrepreneurial activity.
D. exorbitant and should be taxed away.
Answer: B
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Intel and AMD are a duopoly that produces CPU chips. Intel and AMD can conduct R&D or they cannot conduct R&D. The table above shows the payoff matrix for the two firms
If AMD is playing a tit-for-tat strategy, then if Intel conducted R&D last period, AMD A) definitely conducts R&D this period. B) definitely does not conduct R&D this period. C) might conduct R&D or might not conduct R&D, depending on Intel's profit. D) might conduct R&D or might not conduct R&D, depending on its profit. E) might conduct R&D or might not conduct R&D, but more information is needed to determine its action.
What determines how much labor a household will supply?
What will be an ideal response?
If a good has a price elasticity of demand coefficient less than one, then:
a. this good has an elastic demand. b. this good has an inelastic demand. c. a 10 percent increase in the price will result in a greater than 10 percent decrease in the quantity demanded. d. the demand curve will be vertical.
The marginal benefit of additional information:
A. is independent of the amount of information that has already been acquired. B. rises as more information is collected. C. falls as more information is collected. D. tends to be lower for expensive items than inexpensive items.