Which of the following is an example of an implicit cost that a firm might incur?
A) the revenue a firm generates in using its resources
B) the rental value of the office space the company owns and uses for itself
C) the out-of-pocket expense to hire resources
D) taxes owed to the state and Federal governments
B
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The figure above shows supply curves for soft drinks. Suppose the economy is at point a. A decrease in the price of sugar used to make soft drinks is shown as a movement from point a to a point such as
A) none of the points that are illustrated. B) point b. C) point c. D) point d.
A nondiscriminating monopolist earning positive short-run economic profit determines that its current marginal cost is $15 and its current marginal revenue is $20 . To maximize profit, a firm should
a. raise price and increase output b. raise price and decrease output c. maintain a constant price and increase output d. reduce price and increase output e. shut down
Helium Sports produces shoes at a factory that is designed to work at the efficient scale of production using a combination of 2 machines and 400 workers. The cost of labor has recently increased by 25%. In the given situation, which of the following steps should the company take?
a. Helium Sports should reduce production quantity to keep costs under control. b. Helium Sports should lower prices on their shoes to increase demand. c. Helium Sports should make changes to lower the opportunity costs. d. Helium Sports should update the factory with machines that require fewer workers.
A rightward shift in the aggregate demand curve can be caused by an increase in:
A. the price level. B. business investment spending. C. taxes. D. production costs.