As more firms enter an industry
Correct answer(s):
- Economic profits decrease
Topic
Fundamentals of Managerial Economics
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Quizzes in Fundamentals of Managerial Economics
The primary inducement for new firms to enter an industry is:
Correct answer(s):
- Presence of economic profits
Which of the following signals to the owners of scarce resources are the best uses of those resources?
Correct answer(s):
- Profits of businesses
Which of the following is an implicit cost of going to college?
Correct answer(s):
- Foregone wages
Which of the following is an implicit cost to a firm that produces a good or service?
Correct answer(s):
- Foregone profits of producing a different good or service
Economic profits are:
Correct answer(s):
- Total revenue minus total opportunity cost
Accounting profits are:
Correct answer(s):
- Total revenue minus total cost
If the interest rate is 10% and cash flows are $1,000 at the end of year one and $2,000 at the end of year two, then the present value of these cash flows is?
Correct answer(s):
- $2,562
The higher the interest rate:
Correct answer(s):
- The smaller the present value of a future amount