Happy Cows is a dairy farm that is currently earning $50,000 in economic profit. The managers of Happy Cows are considering adding a second dairy farm, which will generate an additional $10,000 in economic profit. It is economically sound for the managers of Happy Cows to add the second farm if, after accounting for the managerial diseconomies, the first farm's economic profits exceed ________.
A) $30,000
B) $40,000
C) $10,000
D) $20,000
B) $40,000
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According to the principle of increasing costs, as the production of one good expands, the opportunity cost of producing another unit of the good tends to increase.
Answer the following statement true (T) or false (F)
If we look at the federal government budget over the past 40 years we see that
A) most years the government budget has been balanced. B) the government has been running a budget deficit since 1997. C) only occasionally has the budget been in deficit. D) most years the budget balance has not been calculated. E) most years the budget has been in deficit.
To reach general equilibrium, the price level adjusts to shift the ________ until it intersects with the ________
A) IS curve; FE line and LM curve B) FE line; LM and IS curves C) LM curve; FE line and IS curve D) ND curve; FE line and NS curve
Stationarity means that the
A) error terms are not correlated. B) probability distribution of the time series variable does not change over time. C) time series has a unit root. D) forecasts remain within 1.96 standard deviation outside the sample period.