A business borrows $100,000 for a lease on a factory with an interest rate of 2 percent, the explicit cost is
A. $80,000.
B. $2,000.
C. $20,000.
D. $120,000.
Answer: B
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XYZ Co operates in a competitive market. Its production function is q = L?K?. The exponents, ? and ?, are both less than one. The firm's capital is fixed, and it takes the wage and price as given
Derive the firm's short-run demand for labor as a function of K, w, and p. How does the firm react to an increase in the wage rate?
Which of the following is most likely a topic of discussion in economics?
a. Families must decide whether to spend their money on a new car or a fancy vacation. b. Nations must choose whether to put more of the budget into police and fire protection or into the school system. c. Towns must choose whether to put more of the budget into police and fire protection or into national defense. d. Nations must decide whether to devote more funds to national defense or to police and fire protection.
Consuming goods until the ratio of marginal utilities of the goods is equal to the ratio of their prices is consistent with maximizing total utility
a. True b. False
GDP is defined as the market value of all final goods and services produced within a country in a given period of time. In spite of this definition, some production is left out of GDP. Explain why some final goods and services are not included