Accounting profit is
a. always less than economic profit
b. never less than economic profit
c. equal to economic profit if a normal profit is earned
d. less than economic profit only when implicit costs are greater than explicit costs
e. greater than economic profit only when implicit costs are greater than explicit costs
B
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You own 10000 bu of wheat in Chicago. You would make the greatest loss if which of the following occurred very quickly?
A. The wheat was hedged and cash price rose $0.50/bu while your basis weakened by $0.15/bu B. The wheat was unhedged and cash price fell by $0.10/bu C. The wheat was hedged and cash price fell $1.00/bu and your basis strengthened by $0.15/bu D. There were no gains in any of the above
By acting as a lender of last resort during a banking panic, a central bank allows commercial banks to
A) encourage the public to borrow directly from the central bank, taking pressure of the banking system. B) satisfy customer withdrawal needs and eventually restore the public's faith in the banking system. C) call in their loans to their customers and eventually restore the public's faith in the banking system. D) make additional loans to increase the assets on their balance sheets.