The high cost of advertising during the Super Bowl will
A) not affect the efficient level of output because advertising is a sunk cost.
B) will affect the efficient level of output because profits will fall significantly.
C) not affect the efficient level of output because advertising is a fixed cost.
D) Not enough information given.
A
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As the proportion of labor contracts that index wages to prices declines, we would expect that
A) a reduction in the unemployment rate will now have a smaller effect on inflation. B) the natural rate of unemployment will increase. C) the natural rate of unemployment will decrease. D) nominal wages will become more sensitive to changes in unemployment.
How are money cost and opportunity cost related to each other?
a. If markets function well, they are closely related. b. They are always identical in any economic system. c. Opportunity cost always exceeds money cost. d. Money cost is less than or equal to opportunity cost. e. In a market economy, they are always equal to each other.