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    Simple questions on basic economics

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    Simple questions on basic economics

    Question 1

    Nonvalue-maximizing behavior is most common:

    in vigorously competitive markets.

    When shareholders are poorly informed.

    when managers own a significant ownership interest.

    in the production of goods rather than services.

    Question 2

    Managerial economics cannot be used to identify:

    how macroeconomic forces affect the organization.

    goals of the organization.

    Ways to efficiently achieve the organization's goals.

    microeconomic consequences of managerial behavior.

    Question 3

    Business profit is

    The residual of sales revenue minus the explicit accounting costs of doing business.

    a normal rate of return.

    economic profit.

    the return on stockholder's equity.

    Question 4

    Monopoly exploitation is reduced by regulation that:

    enhances product-market competition.

    increases the bargaining power of workers.

    increases the bargaining power of employers

    restricts output.

    Question 5

    The value of the firm is equal to:

    the present value of tangible assets

    the present value of all future revenues

    the present value of all future cash flows.

    current revenues less current costs.

    Question 6

    Economic profit equals:

    normal profits plus opportunity costs.

    business profits minus implicit costs.

    business profits plus implicit costs.

    normal profits minus opportunity costs.

    Question 7

    An equation is:

    an analytical expression of functional relationships.

    a visual representation of data.

    a table of electronically stored data.

    a list of economic data.

    Question 8

    The breakeven level of output occurs where:

    marginal cost equals average costs.

    marginal profit equals average costs.

    total profit equals zero

    marginal costs equals marginal revenue.

    Question 9

    Inflation is:

    a line that touches but does not intersect a given curve.

    a point of maximum slope.

    a measure of the steepness of a line.

    an activity level that generates highest profit.

    Question 10

    If P = $ 1,000 - 4Q:

    MR = $ 1,000 - 4Q.

    MR = $1000 - 8Q.

    MR = $1,000Q - $4.

    MR = $250 - $.25P

    Question 11

    Total cost minimization occurs at the point where:

    MC=0.

    MC=AC

    AC=0

    Q=0

    Question 12

    At the profit-maximizing level of output:

    Marginal profit equals zero

    marginal profit is less than average profit.

    marginal profit exceeds average profit.

    marginal cost equals average cost,

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    Question 1

    Nonvalue-maximizing behavior is most common:

    in vigorously competitive markets.

    When shareholders are poorly informed.

    when managers own a significant ownership interest.

    in the production of goods rather than services.
    Answer: When shareholders are poorly informed.

    Question 2

    Managerial economics cannot be used to identify:

    how macroeconomic forces affect the organization.

    goals of the organization.

    Ways to efficiently achieve the organization's goals.

    microeconomic consequences of managerial behavior.
    Answer: goals of the organization.

    Question 3

    Business profit is

    The residual of sales revenue minus the explicit accounting costs of doing business.

    a normal rate of return.

    economic profit.

    the return ...

    Solution Summary

    This solution is comprised of a detailed explanation to answer simple questions on basic economics.

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