Explain what entrepreneurship is and why it is considered a factor of production
What will be an ideal response?
Entrepreneurship is the resource (the people) that runs businesses. Entrepreneurs organize the other resources, land, labor, and capital. It is a factor of production because people with the desire and talent to successfully organize a business are needed to run businesses.
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For prices above the minimum average variable cost, a perfectly competitive firm's supply curve is
A) horizontal at the market price. B) vertical at zero output. C) the same as its marginal cost curve. D) the same as its average variable cost curve.
Refer to Figure 4-8. Suppose that instead of a rent ceiling, the government imposed a price floor of $2,000 per month for apartments. What is the value of consumer surplus after the imposition of the price floor?
A) $6,000 B) $30,000 C) $100,000 D) $240,000