Because a firm has implicit costs as well as explicit costs
A) its economic profit is usually the same as its accounting profit.
B) its accounting profit is always less than its economic profit.
C) its economic profit is usually more than its accounting profit.
D) its economic profit is usually less than its accounting profit.
Answer: D
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The increase in the demand for widgets, shown in the figure above, is the result of an increase in income. Therefore, widgets
A) are a normal good. B) are an inferior good. C) are elastically demanded. D) are inelastically demanded.
Dorothy likes to invest in gold as part of her overall financial investment portfolio, as her gut tells her it will increase dramatically in value. Her favorite and generally only source of investment advice is Wizard's Gold Hour on the OZ cable
channel. As a result of this advice, Dorothy's portfolio mix is suboptimal, as it is too heavily weighted in gold. Behavioral economists would say that Dorothy suffers from: A. framing effects. B. confirmation bias. C. self-serving bias. D. planning fallacy.