The reason a corporation has retained earnings is to
A) pay unemployment taxes.
B) make investments that will increase the value of the stock.
C) avoid the double taxation of corporate profits.
D) be able to make unemployment payments.
Answer: B
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Answer the following statements true (T) or false (F)
1) If your firm has a random demand, producing at the level that maximizes your expected profit will earn the same profit as the profit-maximizing production level with a known demand. 2) If a firm's demand is random, the firm's price and profit are also random. 3) If a perfectly competitive firm has a random demand and known marginal cost, producing at a level that sets expected price equal to marginal cost minimizes the reduction in expected profit. 4) If a firm's demand is known, but has random costs, it cannot maximize its actual profit. 5) When both demand and cost are random, firms cannot maximize expected profit.
Economist Kenneth Arrow wrote a famous book in 1951 in which he took up the question,
a. Is there a perfect voting system? b. Are preferences transitive? c. Is a dictatorship a good form of government? d. Does Democracy work?
International trade patterns are broadly consistent with the Heckscher-Ohlin prediction that nations tend to export the products that use their abundant factors intensively.
Answer the following statement true (T) or false (F)
The distribution of income in one nation can be illustrated by the
A) Laffer curve. B) aggregate demand curve. C) Lorenz curve. D) Phillips curve.