Suppose the firm's cost of capital increases. This would not change the capital budgeting choices the firm makes if it uses
A. Payback
B. NPV analysis
C. IRR analysis
Answer: A. Payback
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Which of the following about corporations is TRUE?
A) The cost of capital and labor is high relative to that paid by a proprietorship. B) Profits are taxed only once as the owners' income. C) The owners' entire wealth is at risk. D) Corporations' profits are taxed independently of their owners' incomes.
Refer to the graph below representing the market demand curve for a monopolist’s output. Which of the following quantities shown on the graph should the monopolist produce if it wishes to maximize its total revenue?
a. 900
b. 1,000
c. 1,100
d. Any of the above because total revenue does not change with a change in production.
The change in the consumption of one good that just offsets a one-unit change in the consumption of another good is the
A. marginal rate of satisfaction. B. marginal utility. C. marginal rate of consumption. D. marginal rate of substitution.
If the opportunity costs of producing a good increase as more of that good is produced, the economy's production possibility frontier will be
A. a negatively sloped straight line. B. negatively sloped and "bowed inward" toward the origin. C. negatively sloped and "bowed outward" from the origin. D. a positively sloped straight line.