Firms do not continue to grow without limit because of

a)Managerial limitations

b)Governmentregulation

c)Income taxes

d)Antitrust laws

What is the present value of $1.21 received at the end of two years if the interest rate is 10% and compounding is annual?

a)$1.31

b)$1.21

c)$1.10

d)$1.00

Monica quit her $50,000 per year job, purchased a building that was previously rented by the operator of a candy store for $1,500 per month, and used the space to breed and sell tropical fish. In her first year she made a business profit of $60,000. What was her economic profit?

a)Her economic profit was the same as her business profit

b)$42,000

c)$10,000

d)She made an economic loss of $8,000

If automobile manufacturers are producing cars faster than people want to buy them,

a)There is an excess supply and price can be expected to decrease

b)There is an excess supply and price can be expected to increase

c)There is an excess demand and price can be expected to decrease

d)There is an excess demand and price can be expected to increase

Which of the following is an example of a resource constraint?

a)Pollution control laws

b)Inadequate demand

c)Excessive production costs

d)Inadequate financial capital

Which of the following is the best definition of economic profit?

a)Business profit minus implicit costs

b)Total revenue minus total explicit costs

c)Total revenue minus total implicit costs

d)Business profit minus explicit costs

Setting a high price when the product is first introduced and then gradually lowering its price over time is referred to as

a)Value pricing

b)Skimming

c)Price lining

d)Prestige pricing

A grocery shop that offers 1 can of soup for Rp.10000 and 3 cans for Rp. 25000 is engages in

a)First-degree price discrimination

b)Second-degree price discrimination

c)Third-degree price discrimination

d)The answer cannot be determined without additional information

Which of the following do not protect the domestic producers from foreign competition?

a)Import tariffs

b)Import quotas

c)Voluntary export restrictions

d)All of the above protect domestic producers from foreign competition