If you were to start your own business, your implicit costs would include the:
A. opportunity cost of the time you spend working at the business.
B. profit you earn over and above your normal profit.
C. interest that you pay on your business loans.
D. rent that you have paid in advance for the use of a building.
Answer: A
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Approaching a business cycle peak, actual real GDP ________ natural real GDP, which causes inflation to ________
A) exceeds, remain constant B) exceeds, accelerate C) is less than, decelerate D) equals, accelerate E) equals, remain constant
Which of the following items would be considered scarce?
A) water B) diamonds C) potato chips D) All of the above are scarce.
For any given family of indifference curves, a consumer would prefer to be at a point:
A. on the indifference curve that is closest to the origin. B. that is far to the right on an indifference curve. C. that is far to the left on an indifference curve. D. on the indifference curve that is farthest from the origin.
(Appendix) In the production function Q = 10L1/2K1/2, is diminishing returns a characteristic of this production function?
What will be an ideal response?