According to the Application, recent reforms in Cuba have relied less on the free market in determining prices in the housing market
Indicate whether the statement is true or false
FALSE
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Which of the following is a nominal quantity?
A. The amount of coal mined in one month B. The current price of a barrel of oil C. The number of people unemployed D. The number of cars produced in 2005
Which of the following characteristics of Exland, a less-developed country, is not typical?
a. a high percentage of the population under 15 b. political instability c. modern technology d. lack of infrastructure e. dependence on exports of natural resources
During a year of operation, a firm collects $450,000 in revenue and spends $100,000 on labor expense, raw materials, rent, and utilities. The firm's owner has provided $750,000 of her own money form her personal portfolio instead of investing the money and earning a 10% annual rate of return. The firm also operates out of a building they own worth $1,000,000 which the owner inherited 25 years ago.
1.The explicit costs of the firm are $______________. 2. If the owner could earn 15% annually on the money she has invested in the firm, the economic profit of the firm would be ______________ (when revenue is $450,000). 3. The implicit costs are $______________. 4. The firm's accounting profit is $______________. 5. The firm earns an economic profit of $______________.
Suppose that Company A's railroad cars pass through Farmer B's corn fields. The railroad causes an externality to the farmer because the railroad cars emit sparks that cause $1,500 in damage to the farmer's crops. There is a special soy-based grease that the railroad could purchase that would eliminate the damaging sparks. The grease costs $1,200 . Suppose that the railroad is not liable for any
damage caused to the crops. Assume that there are no transaction costs. Which of the following characterizes an efficient outcome? a. The railroad will continue to operate but will pay the farmer $1,500 in damages. b. The railroad will purchase the grease for $1,200 and pay the farmer nothing because no crop damage will occur. c. The farmer will incur $1,500 in damages to his crops. d. The farmer will pay the railroad $1,200 to purchase the grease so that no crop damage will occur.