Any cost that is imposed without compensation on someone other than the person who caused it is called:
A. social cost.
B. external cost.
C. network cost.
D. private cost.
Answer: B
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What do economists mean by the phrase "sunk costs are sunk"?
a. Sunk costs are irretrievable, but they do lower profits and thus affect the firm's output level. b. Sunk costs are a primary reason why marginal costs tend to increase. c. Sunk costs cannot be recovered and are irrelevant to future decision making. d. Sunk costs lower consumer welfare, because producers "pass on" these costs in the form of higher prices.
In the above figure, the break-even output and price is
A) $9 and 14. B) $13 and 14. C) $11 and 16. D) $10 and 17.
Empirical evidence on the U.S. economy suggests that household spending and income have an inverse relationship
a. True b. False Indicate whether the statement is true or false
The maximum welfare benefit levels in most states
A. by law are 1.5 times the poverty income threshold. B. by law must equal the poverty income threshold. C. are significantly above the poverty income threshold. D. are significantly below the poverty income threshold.