Before taking management and trading costs into account, arbitrage activities in the market ensure that the returns of actively managed funds are:
A. Significantly higher than those of index funds with similar risk
B. Significantly lower than those of index funds with similar risk
C. About the same as those of index funds with similar risk
D. More volatile than those of index funds with similar risk
C. About the same as those of index funds with similar risk
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Consider a perfectly competitive industry in a long-run equilibrium. If a single firm in that industry discovers a significant cost-saving production technology, then:
A. the firm will earn an economic profit in the long run. B. the rest of the industry will quickly adopt the new technology. C. all firms in the market will earn an economic profit in the short run. D. all the firms in the market will earn an economic profit in the long run.
Let the marginal leakage rate be 0.5 while the marginal propensity to consume is 0.8. Then a $50 million reduction in autonomous taxes will cause autonomous consumption to ________ and equilibrium income to ________
A) fall by $50 billion; fall by $100 billion B) rise by $50 billion; rise by $100 billion C) fall by $40 billion; fall by $200 billion D) rise by $40 billion; rise by $80 billion
The cost function is:
a. a means for expressing output as a function of cost b. a schedule or mathematical relationship showing the total cost of producing various quantities of output c. similar to a profit and loss statement d. incapable in being developed from statistical regression analysis e. none of the above
Recall the Application about the opportunity cost of an entrepreneur to answer the following question(s).According to this Application, which of the following is currently a popular way to earn an income?
A. renting out your home through Airbnb B. selling your kidneys C. driving your car through Uber D. cleaning other people's homes