1. Economists assume that the typical person who starts her own business does so with the...
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1. Economists assume that the typical person who starts her own business does so with the intention of a donating the profits from her business to charity. b. capturing the highest number of sales in her industry. c.maximizing profits. d. minimizing costs. 2. The amount of money that a firm pays to buy inputs is called a total cost. b. variable cost. c.marginal cost. d. fixed cost. 3. Gloria has decided to start her own snow removal business. To purchase the necessary equipment, Gloria withdrew $2,000 from her savings account, which was earning 3% interest, and borrowed an additional $4,000 from the bank at an interest rate of 7%. What is Gloria's annual opportunity cost of the financial capital that has been invested in the business? a $60 b. $280 c. $340 d. $660 4. A firm's opportunity costs of production are equal to its a explicit costs only. b. implicit costs only. c. explicit costs + implicit costs. d. explicit costs + implicit costs + total revenue. 5. Which of the following statements is correct? a. Assuming that explicit costs are positive, economic profit is greater than accounting profit. b. Assuming that implicit costs are positive, accounting profit is greater than economic profit. c. Assuming that explicit costs are positive, accounting profit is equal to economic profit. d. Assuming that implicit costs are positive, economic profit is positive. 6. production function is a relationship between inputs and quantity of output. b. revenue. c. costs d. profit. 1. Economists assume that the typical person who starts her own business does so with the intention of a donating the profits from her business to charity. b. capturing the highest number of sales in her industry. c.maximizing profits. d. minimizing costs. 2. The amount of money that a firm pays to buy inputs is called a total cost. b. variable cost. c.marginal cost. d. fixed cost. 3. Gloria has decided to start her own snow removal business. To purchase the necessary equipment, Gloria withdrew $2,000 from her savings account, which was earning 3% interest, and borrowed an additional $4,000 from the bank at an interest rate of 7%. What is Gloria's annual opportunity cost of the financial capital that has been invested in the business? a $60 b. $280 c. $340 d. $660 4. A firm's opportunity costs of production are equal to its a explicit costs only. b. implicit costs only. c. explicit costs + implicit costs. d. explicit costs + implicit costs + total revenue. 5. Which of the following statements is correct? a. Assuming that explicit costs are positive, economic profit is greater than accounting profit. b. Assuming that implicit costs are positive, accounting profit is greater than economic profit. c. Assuming that explicit costs are positive, accounting profit is equal to economic profit. d. Assuming that implicit costs are positive, economic profit is positive. 6. production function is a relationship between inputs and quantity of output. b. revenue. c. costs d. profit.
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Related Book For
Income Tax Fundamentals 2013
ISBN: 9781285586618
31st Edition
Authors: Gerald E. Whittenburg, Martha Altus Buller, Steven L Gill
Posted Date:
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