Income earned by the productive resources does not include
a. wages and salaries.
b. transfer payments.
c. profits.
d. interest.
b. transfer payments.
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The positively-sloped part of the long-run average total cost curve is due to which of the following?
A) Diseconomies of scale. B) Diminishing returns. C) The firm being able to take advantage of large-scale production techniques as it expands its output. D) The increase in productivity that results from specialization.
There are 10 identical internet service providers (ISPs) in a city serving a market demand with an elasticity of -1.5. The elasticity of supply for each firm is 3.0. The elasticity of demand faced by an individual ISP is
A) -42. B) -15. C) -1.5. D) -27.
For the monopolistically competitive firm, the steepness of the demand curve depends on:
A. the steepness of the MC curve. B. the number of consumers in the market. C. the availability of close substitutes. D. None of these statements is correct.
The hypothesis that people's spending decisions are based on all available information, including the anticipated effects of government intervention, is known as
A. Rational responses. B. The velocity of money. C. Rational expectations. D. Fiscal expectations.