An example of an implicit cost is
a. rent.
b. taxes.
c. wages.
d. forgone interest when investing one’s savings in one’s own business.
d. forgone interest when investing one’s savings in one’s own business.
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Which one of the following transactions would be included in GDP?
a. Ms. Kim pays $50 for a used picture frame at a neighborhood garage sale. b. Mr. Doe donates $500 to his town's junior college scholarship fund. c. Ms. Bartolini pays $500 to fix the front end of her car damaged in a recent accident. d. Ms. Smith pays $5,000 to purchase 100 shares of Microsoft stock.
Which of the following does not contribute to the high productivity of the U.S. economy?
A. Factor mobility. B. The capital stock. C. Technology. D. Negative externalities.
When no property rights exist
A) no one has an economic incentive to care for common property, and an externality may well occur. B) there will be no production. C) externalities will be internalized by voluntary arrangements among a small group of parties. D) society will produce beyond the production possibilities frontier, but the allocation of resources is not apt to be optimal.
It has been argued that a monopolistically competitive industry involves "waste" because
A) there is too much product differentiation making shelves too crowded. B) they end up producing to the right of the minimum of the average total cost curve and the price is below the marginal cost. C) the firms do not equate marginal cost to marginal revenue to find the profit maximizing price and output. D) the firms do not produce at the minimum of the average total cost curve and price is above marginal cost.