You use $45,000 of your own money to start an espresso stand. During the first year you earn a 10% return on that investment. If the current interest rate is 8%, you earn an economic profit of
A. -$900.
B. $100.
C. $500.
D. $900.
Answer: D
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Which of the following is a reason why a firm would experience diseconomies of scale?
A) As the size of the firm increases, it must operate in other countries where differences in language, customs, and laws increase its average costs. B) To finance an increase in the size of its plant a firm must borrow more money or sell more shares of stock. C) As the size of the firm increases, it becomes more difficult to find markets where it doesn't already have operations. D) As the size of the firm increases it becomes more difficult to coordinate the operations of its manufacturing plants.
The division of productive activities among persons and regions so that no one individual or area is totally self-sufficient is known as
A) advantage-taking. B) comparative value. C) specialization. D) outsourcing.
Under monopoly, resources are allocated as efficiently as in perfect competition.
Answer the following statement true (T) or false (F)
Cost benefit considerations would be most typical of which type of ethics?
a. consequentialism b. egoism c. kantian d. utilitarianism