The normal rate of return on capital is also known as the
A. opportunity cost of capital.
B. depreciation cost of capital.
C. monopoly rent.
D. fixed cost of capital.
Answer: A
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The IMF offers loans to developing countries in times of balance of payment constraints, but the IMF also faces strong criticisms because:
A. contractionary fiscal policy and expansionary monetary policy tend to be ineffective against balance of payment constraints. B. contractionary fiscal and monetary policies are always undesirable for any developing country. C. it employs economists that know little about developing countries and their economic affairs. D. the conditions tend to be procyclical, therefore worsening the recessions.
Which of the following is NOT a necessary condition for a firm to price discriminate?
A. The firm must be a price-taker. B. Resale of the product must be preventable. C. Buyers in different markets must have different elasticities of demand. D. The firm must be able to separate markets.
The phrase that was coined by John Maynard Keynes to describe the feelings of investors was the ________ of entrepreneurs.
A. animal spirits B. karma C. optimism D. pessimism
In the long run, a monopoly
A. will yield an efficient outcome. B. may earn positive economic profits due to entry barriers. C. will always earn zero economic profits. D. will never exit the industry.