Firms that employ exceptionally productive resources
A. have lower costs than other firms in the industry and are able to earn positive economic profit in the long run.
B. earn zero economic profit.
C. will typically have to pay the exceptional resource economic rent equal to the reduction in cost due to employing the exceptionally productive resource.
D. both a and b
E. both b and c
Answer: E
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In the above figure, which point represents an attainable but inefficient production point?
A) point C B) point N C) point L D) point D
Refer to the table above. Country A has a comparative advantage in
A) beer. B) wine. C) both beer and wine. D) neither beer nor wine.
Which of the following will not shift the production possibilities curve outward?
a. an improvement in technology, which increases the efficiency of inputs b. the discovery of significant oil reserves in Alaska c. a decrease in capacity utilization of existing factories d. additions to the stock of physical capital
Supposing a college education is choosing between a modestly expensive school ($100,000 over 4 years) and a less expensive school ($40,000 over 4 years), the student should
A. choose the more expensive school only if the present value of the difference in salary is $60,000 or less. B. choose the more expensive school only if the present value of the difference in salary is $60,000 or more. C. choose the more expensive school only if the difference in salary will total $60,000 or more. D. choose the more expensive school only if the difference in salary will total $60,000 or less.