Economic profit equals accounting profit minus:
a. explicit costs.
b. implicit costs.
c. fixed costs.
d. variable costs.
b
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Consumers value the product-specific services for a new smartphone at $20 and the marginal cost to the retailers for providing the product-specific services is $20. If the retailers provide the product-specific services, which of the following is true?
A) The shift in the market demand will equal the shift in the market supply. B) The shift in the market demand will be exactly double the shift in the market supply. C) The shift in the market supply will exceed the shift in the market demand. D) The shift in the market demand will exceed the shift in the market supply.
Recipients of Medicare tend to demand a greater quantity of low-value, high-cost services because
A) the services are readily available. B) recipients are coerced into demanding such services. C) the government mandates that they demand such services. D) the services are heavily subsidized.
Tariffs to limit imports to "protect U.S. jobs" will also
A) stimulate exports. B) limit exports. C) decrease import prices. D) reduce domestic production of import-threatened products.
In the short run, a firm
A. has at least one fixed factor of production. B. can exit an industry, and all of its factors of production are variable. C. can enter an industry where positive profits are being earned. D. Both B and C are correct.