Suppose that a firm's capital equipment is expected to last indefinitely, that operating expenses ...

Suppose that a firm's capital equipment is expected to last indefinitely, that operating expenses on the equipment are negligible, and that the price of the firm's product is expected to remain constant in the future. Under these circumstances, the firm's marginal rate of return on investment is equal to capital's
 a. marginal resource cost as a percentage of its marginal revenue product
  b. marginal product as a percentage of its marginal revenue product
  c. marginal revenue product as a percentage of its marginal product
  d. marginal resource cost as a percentage of the price of capital
  e. marginal revenue product as a percentage of its marginal resource cost

QUESTION 2

Which of the following is not true about the U.S. trade balance since 1979?
 a. The balance of trade has been in deficit.
  b. During recessions the balance has usually been flat.
  c. The balance of trade has been in surplus.
  d. When the economy expanded, the demand for imports increased.
  e. When the economy expanded, the trade balance worsened.

QUESTION 3

The marginal rate of return on investment is equal to capital's
 a. MRC  MRP/2
  b. MRC/MRP
  c. MRP/MRC
  d. MRC  MRP/2
  e. MRC  MRP  the interest rate

QUESTION 4

The merchandise trade balance does not include
 a. exports of refrigerators
  b. imports of automobiles
  c. exports of agricultural products
  d. shipping and insurance costs
  e. imports of food items with heavy tariffs

QUESTION 5

A firm's demand curve for investment is its
 a. marginal resource cost curve
  b. marginal product curve
  c. marginal revenue curve
  d. marginal rate of return on investment curve
  e. supply of loanable funds curve

QUESTION 6

The merchandise trade balance measures
 a. the value of goods and services exported
  b. the value of all goods and services exported minus the value of all goods and services imported
  c. the value of all goods and services exported minus the value of all goods and services imported, and transactions to finance the difference
  d. the value of all tangible products exported minus the value of all tangible products imported
  e. the value of all tangible products exported minus the value of all tangible products imported, and transactions to finance the difference

QUESTION 7

IBM's marginal rate of return on investment curve equals its
 a. supply of loanable funds curve
  b. supply of investment curve
  c. marginal revenue product curve
  d. marginal revenue cost curve
  e. investment demand curve

QUESTION 8

A nation's merchandise trade balance reflects
 a. trade in tangible products
  b. value of exports
  c. value of imports
  d. the same information as its balance of payments
  e. trade in tangibles and intangibles

QUESTION 9

If a firm can borrow or lend at a 6 percent annual interest rate, it will
 a. buy more capital if it has the funds on hand than if it has to borrow them
  b. ignore the market rate of interest when making capital investment decisions
  c. buy less capital if it has the funds on hand than if it has to borrow them
  d. ignore the market rate of interest when making saving decisions
  e. buy the same amount of capital whether it has the funds on hand or has to borrow them