The person who assumes the risks and uncertainties of business is
a. a manager of the business
b. an owner of the business
c. an excellent example of human capital
d. an entrepreneur
e. key to production, but not a factor of production
D
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Mr. Capps recently built a dental floss factory in Montana. It cost $500,000 and is expected to last ten years. The plant can only be used to produce dental floss and will have no scrap value. When a recession occurs, the yearly revenue from the plant declines to $35,000 . compared to costs of $25,000 just for the variable resources required to produce the current rate of output. Mr. Capps should
a. shut down since he is experiencing economic losses (in other words, he will not get his $500,000 back). b. reduce the price of dental floss if his demand is inelastic in order to increase his revenue. c. raise the price of dental floss if his demand is elastic in order to increase his revenue. d. continue to operate since he is covering his variable costs and the cost of the plant is a sunk cost.
The balance of trade is
A) the difference between exports and imports of goods and services. B) the difference between exports and imports of services. C) the summary record of a country's economic transactions with foreigners in a year. D) none of the above.