How do economists view profits?
A) The firm's profit equals the sum of all payments to the 5 factors of production.
B) Profits are an asset the business holds.
C) Profits are guaranteed as long as a firm operates ethically.
D) Profits are one of the costs paid to a factor of production.
D
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The Laffer curve
A) initially slopes upward as increasing tax rates lead to increasing tax revenue but eventually will slope downward as increasing tax rates lead to decreasing tax revenue. B) slopes upward throughout its range since increasing tax rates will always lead to increases in tax revenue. C) is horizontal because tax revenue is independent of the rate of interest. D) slopes downward throughout its range since increasing tax rates will always lead to decreases in tax revenue.
For a household, the opportunity cost of not working is the
A) price level. B) nominal wage rate. C) demand for labor. D) cost of living. E) real wage rate.