Firm Production
The primary goal of a business firm is to A. make a quality product. B. promote fairness. C. promote workforce job satisfaction. D. maximize profit. E. increase its production.
maximize profit
Which of the following is true? A. Economic profit ignores implicit costs. B. Profit as calculated by accountants and economic profit are not necessarily equal. C. Profit as calculated by accountants is always smaller than economic profit. D. The Internal Revenue Service taxes the firm's normal profit but not its economic profit. E. The Internal Revenue Service taxes the firm's economic profit but not its normal profit.
Profit as calculated by accountants and economic profit are not necessarily equal
The cost that a firm pays in money to hire a resource is referred to as ________ cost. A. a maximized B. a total C. an implicit D. a minimized E. an explicit
an explicit
Darryl runs a ranch in Jackson, Wyoming. The interest on the debt he incurred to buy his ranch totals $3,000 per year. For Darryl, the interest is A. an explicit cost. B. his normal cost. C. his normal profit. D. an implicit cost. E. part of his economic profit.
an explicit cost
A cost incurred in the production of a good or service and for which the firm does not need to make a direct monetary payment, is referred to as ________ cost. A. an implicit B. an invisible C. a minimized D. a maximized E. an explicit
an implicit
The difference between a firm's total revenue and its total cost is its ________ profit. A. excess B. accounting C. economic D. normal E. explicit
economic
A firm's total revenue minus its total opportunity cost is called its A. entrepreneur's profit. B. accounting profit. C. normal profit. D. abnormal profit. E. economic profit.
economic profit.
When an economist uses the term "cost" referring to a firm, the economist refers to the A. explicit cost of producing a good or service but not the implicit cost of producing a good or service. B. opportunity cost of producing a good or service, which includes both implicit and explicit cost. C. implicit cost of producing a good or service but not the explicit cost of producing a good or service.. D. cost that can be actually verified and measured. E. price of the good to the consumer.
opportunity cost of producing a good or service, which includes both implicit and explicit cost.
If a business owner decided to expand her business but rather than borrowing money from a bank used her own funds, then A. the amount of her funds she used is part of her normal profit. B. the amount of her funds she used is an explicit cost. C. she would be unable to earn a normal profit. D. she would forego the opportunity to earn interest on the money. E. there is no cost associated with the expansion.
she would forego the opportunity to earn interest on the money