Economic profit is defined as
a. total revenue minus price
b. price minus quantity
c. total revenue minus what must be paid to resources to attract them from their best alternative use
d. total revenue divided by what must be paid to resources to attract them from their best alternative use
e. total revenue plus what must be paid to resources to attract them from their best alternative use
C
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If a marginal cost pricing rule is imposed on the natural monopoly shown in the figure above, then the deadweight loss will equal
A) $0. B) $4 million. C) $8 million. D) $12 million.
Helping a struggling domestic company through import restrictions frequently causes other countries to retaliate.
a. true b. false
The money, time, and opportunity used to change prices to keep pace with inflation are called:
A. the velocity of inflation. B. menu costs. C. shoe-leather costs. D. tax distortions.
During most episodes of hyperinflation,
A) the inflation rate is high but constant. B) the inflation rate decreases over time. C) the inflation rate increases over time. D) the inflation rate first increases, and then remains constant. E) the inflation rate increases over time, but then rapidly decreases on its own.