When accounting profits are negative, economic profits
A) must be positive.
B) will be negative.
C) will equal zero.
D) could be positive, negative or zero.
Answer: B
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Because the United States is highly integrated with the international capital market, international capital flows tend to
a. counteract the negative effect on aggregate demand of lower interest rates. b. counteract the positive effect on aggregate demand of higher interest rates. c. strengthen the negative effects on aggregate demand of higher interest rates. d. strengthen the negative effects on aggregate demand of lower interest rates.
Individuals want nonexcludable public good X, but the market does not provide it because of the free rider problem. Government overcomes the free rider problem by ______________ individuals and then either producing good X itself or paying someone to produce it
A) forcing individuals to work longer hours B) taxing C) surveying D) subsidizing E) none of the above