The accounting profit earned by a firm is smaller than its economic profit because accountants include the value of various opportunity costs of production when calculating the accounting profit
a. True
b. False
Indicate whether the statement is true or false
False
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Investments are actions that incur costs in the future but provide expected benefits today
Indicate whether the statement is true or false
For a monopolist, average revenues:
A. are always equal to price. B. equal price only at the profit maximizing quantity. C. are always zero at the profit maximizing quantity. D. are maximized when total revenues are maximized.
If the rational expectation theory is accurate, equilibrium real GDP will change in the short run: a. whenever the aggregate demand curve shifts
b. only if discretionary fiscal policy is used. c. only if there is a shift in aggregate demand that could not have been predicted from the information available to the public. d. only if discretionary monetary policy is used.
Suppose that country A produces mostly consumption goods and few investment goods, while country B produces mostly investment goods with few consumption goods. Other things constant, which of the following is most likely to happen in the future?
a. The per capita income of country A will grow more rapidly than country B. b. The population of country B will grow more rapidly than country A. c. The production possibilities curve (PPC) of country B will shift out more rapidly than the PPC of country A. d. The production possibilities curve (PPC) of country A will shift out more rapidly than the PPC of country B.