Accounting profits are calculated based upon:
a. explicit cash receipts and implicit costs
b. actual cash receipts and actual expenditures of cash.
c. implicit cash receipts and actual expenditures of cash.
d. opportunity costs plus explicit costs.
b
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A guarded barbed wire fence separates East and West Bovinia. Soccer players are paid twice as much in West Bovinia as in East Bovinia. This is an example of
a. inelastic supply b. a temporary resource price differential c. a permanent resource price differential d. diminishing marginal revenue product e. economic rent
The body that directly oversees the 12 regional Federal Reserve banks is the:
A. Federal Open Market Committee. B. U.S. Congress. C. Board of Governors. D. Federal Advisory Council.
The menu cost theory states that
A. prices depend only on the input costs. B. economic agents quickly learn the likely responses of the Fed to changes in unemployment. C. prices are not fully flexible because it is costly for firms to change prices every time there is a demand change. D. the economy is characterized by perfect competition.
According to the misperceptions theory, the amount by which producers increase their output when the general price level rises depends on
A. the slope of the aggregate demand curve. B. the slope of the long-run aggregate supply curve. C. how much they think their relative prices have increased. D. the size of the Solow residual.