Sebastian decides to open a tree farm. When deciding to open his own business, he turned down two separate job offers of $25,000 and $30,000 and withdrew $20,000 from his savings. Sebastian's savings account paid 3 percent interest. He also borrowed $20,000 from his brother, whom he pays 2 percent interest per year. He spent $15,000 to purchase supplies and earned $50,000 in revenue during his
first year. Which of the following statements is correct?
a. Sebastian's total explicit costs are $15,400.
b. Sebastian's total implicit costs are $55,600.
c. Sebastian's accounting profit is $35,000.
d. Sebastian's economic profit is $4,600.
a
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The ________ rate is the rate at which one currency can be traded for another
A) explicit exchange B) nominal exchange C) expected exchange D) real exchange
Which of the following statements best describes the belief among economists about trade?
a. The common belief among economists is that it is better to embrace the gains from trade, and then deal with the costs and trade-offs with other policy tools than it is to cut off trade to avoid the costs and trade-offs. b. The common belief among economists is that it is better to cut off trade to avoid the costs and trade-offs than it is to embrace the gains from trade and then deal with the costs and trade-offs with other policy tools. c. The common belief among economists is that it is better to deal with the costs and trade-offs of trade with other policy tools before embracing the gains from trade, than it is to cut off trade to avoid the costs and trade-offs. d. The common belief among economists is that it is better to cut off trade to avoid the costs and trade-offs, deal with the costs and trade-offs with other policy tools, and then embrace the gains from trade.
________ raised average tariff rates by over 50 percent in the United States in 1930
A) The GATT B) The WTO C) NAFTA D) The Smoot-Hawley Tariff
To determine the real interest rate in the data, one should take the interest rate on government debt
A) and leave it at that. B) and add the inflation rate. C) and subtract the inflation rate. D) and divide by the inflation rate.