ECONOMICS 3302 (Chapter 1-6)

1. The financial hypothesis of business conduct expect that the objective of a firm is to A. earn a bookkeeping benefit. B. earn a financial benefit. C. earn most extreme income. D. maximize its benefit. Express expenses A. measure the open door expenses of the entrepreneurs. B. are consistently fixed in the short run. C. measure the installments made to the company's elements of creation. are consistently factor in the short run. 2. Which of coming up next isn't a case of unequivocal expenses? A. Wages paid to laborers B. Personal reserve funds of the proprietor put resources into the firm C. Salaries paid to the board Office space lease Unequivocal expenses A. are the main costs that issue to ly exceed implicit costs. A. are difficult to measure. appear on the firm's balance sheet. Implicit costs A. equal to total revenues minus implicit costs. B. the difference between total revenues and explicit costs. C. equal to total revenues minus explicit and implicit costs. less than economic profits. An example of an implicit cost is D. 3. A. interest paid on a bank loan. B. wages paid to a family member. C. the value of a spare bedroom turned into a home office. operating costs of a company-owned car. If you were to start your own business, your implicit costs would include A. rent that you have paid in advance for use of a building. B. the opportunity cost of your time. C. profit over and above normal profit. interest that you pay on your business loans. D. 4. Suppose you quit your job to start a business. In the first month, your total revenue was $6,000. You paid $1,000 in monthly rent for office space. $ 200 in monthly rent for equipment. $3,000 to your workers in wages for the month. $1,000 for the supplies you used that month. You determine that your true profit that month was negative $200. Why? A. You did the math incorrectly. B. You accounted for lost salary of $200. C. You accounted for lost salary of $1000. D. Your equipment rent is an implicit cost. Kamal told Lutfiabout his new business venture: Kamal pays Anbar International $1,000 per month for supplies and access to Anbar's network, works out of his own apartment on his own computer and earns monthly revenues of $1500. Should Lutfiquit his job and do what Kamal is doing? A. Yes, if Lutfihas at least $1000 in savings to get started. B. No, not if Lutfiis earning more than $500 per month at his current job. C. Yes, if Lutfican borrow the $1000 monthly payment for less than 3% interest. D. Yes, if Lutfialready owns a computer. 5. If a