An economist left his $100,000-a-year teaching position to work full-time in his own consulting business. In the first year, he had total revenue of $200,000 and business expenses of $150,000 . He made a(n):
a. implicit profit.
b. economic loss.
c. economic profit.
d. accounting loss but not an economic loss.
e. zero economic profit.
b
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A bond purchaser bought a bond from which she receives $800 a year from the issuer. If the face value of the bond is __________ then the coupon rate is __________.
A. $10,000; 10 percent B. $8,000; 8 percent C. $10,000; 8 percent D. $8,000; 12 percent E. none of the above
A Cobb-Douglas production function:
A) exhibits constant returns to scale. B) exhibits increasing returns to scale. C) exhibits decreasing returns to scale. D) can exhibit constant, increasing, or decreasing returns to scale.
When net unilateral transfers are added to the net exports of goods and services, the result is called the
a. merchandise trade balance b. official reserve transactions account c. balance of payments d. balance on capital account e. balance on current account
You have a small business that makes $50,000 accounting and economic profit for you. As a disabled person, you must work at home and you did not have other opportunities until your neighbor offers you a job you like equally well for $50,000 and you can do it at home. This means
A. both your accounting and economic profit have gone up. B. your economic profit has gone down and your accounting profit has stayed the same. C. both your accounting and economic profit have gone down. D. your economic profit has gone down and your accounting profit has gone up.