Sunk costs: a. should be considered, but only when marginal cost is less than marginal benefit. b. should be considered only when there is no information about marginal cost and marginal benefit. c. are essential parts of economic decisions. d. are irrelevant to economic decisions.


Answer 1


 d. are irrelevant to economic decisions.


Sunk cost is cost that has been incurred and cannot be recovered. They are irrelevant and should not be considered when making economic decisions.

For example, if it costs $1500 to build a store and $500 has already been spent. $500 is the sunk cost and it would not be considered in the decision to continue or abandon the project.

I hope my answer helps you

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Assume that matt, joe, and teresa are the only citizens in a community. a proposed public good has a total cost of $1,000. all three citizens will share an equal portion of this cost in taxes. the benefit of the public good is $ 380 for matt, $ 360 for joe, and $ 200 for teresa. in a majority vote, this proposal will most likely be


This proposal will most likely be rejected because two out of the three people will not favor it. This proposal is not a good deal for Joe or Teresa because they would get less money than Matt without a valid reason. Joe and Teresa will reject the proposal to get a more fair share of the money.

Consider the following simple economy that produces only three​ goods: 2009​ (Base Year) 2017 Product Quantity Price Quantity Price Denim pants 80 ​$40 100 ​$50 Wine 90 11 80 10 Textbooks 15 90 20 100 Real GDP in 2017 equals $_____



The answer is $6680


To calculate the Real GDP we use prices from the base year.

GDP =  100x40 + 80x11 + 20x90 = $6680


Destin Corp is comparing three different capital structures. Plan A would result in 10,000 shares of stock and $90,000 in debt. Plan B would result in 7,600 shares of stock and $198,000 in debt. The all equity plan would result in 12,000 shares of stock outstanding. The interest rate on debt is 10%, and the EBIT is $48,000. If Destin Corp has a tax rate of 40%, which of the three plans has the highest EPS?



All equity plan (12,000 shares with an EPS of $2.40)


Plan A (10,000 shares):

interest = $90,000 x 10% = $9,000

net income = (ebit - interest) x (1 - 40%) = ($48,000 - $9,000) x 60% = $23,400

earnings per share (EPS) = $23,400 / 10,000 shares = $2.34 per share

Plan B (7,600 shares):

interest = $198,000 x 10% = $19,800

net income = (ebit - interest) x (1 - 40%) = ($48,000 - $19,800) x 60% = $16,920

earnings per share (EPS) = $16,920 / 7,600 shares = $2.23 per share

All equity plan (12,000 shares):

net income = ebit x (1 - 40%) = $48,000 x 60% = $28,800

earnings per share (EPS) = $28,800 / 12,000 shares = $2.40 per share


The public debt is the: A.) Amount of U.S. paper currency in circulation B.) Ratio of all past deficits to all past surpluses C.) Accumulation of all past deficits minus all past surpluses D.) The difference between current government expenditures and current tax revenues


The public debt is what the government owns to its people or other governments. It's created when the government spends more than it makes so when the expenditures are bigger than the revenues. It's accumulated over the years, so the correct answer is: C.) Accumulation of all past deficits minus all past surpluses

Economic decisions are made differently in different economic systems… a. What are the basic economic decisions that every economic system must make? b. List the three basic economic systems. How does each answer the basic economic questions? c. List and explain four (4) characteristics of the market economy.




The basic economic decisions are; what to produce? 2. How to produce? 3. Whom to produce?

Three economic systems are;

1. Free market

2. Command economy

3.  Mixed economy.

In free market economy system; the products which are profitable, produced,  production method is finalized by an entrepreneur. 3.  the people who can afford to pay.

in command economy ; govt decides all three questions .

while in mixed economy both govt. and pvt .sector decides.

Characteristics of market economy;

1. Profit motive

2. variety of goods and services


The manager at Screaming Trees has been trying to calculate the portion of the​ company's overhead expenses that is fixed and the portion that is variable. Over the past twelve​ months, the number of yards of mulch processed was highest in​ July, when the total monthly overhead costs totaled $ 28 comma 000 for 37 comma 000 yards of mulch processed. The lowest number of yards of mulch processed in the last twelve months occurred in​ October, when total overhead costs were $ 22 comma 000 for 25 comma 000 yards of mulch processed. What was the variable cost per​ yard



The variable cost per​ yard is $0.50


The computation of the variable cost per​ yard is shown below:

= (total monthly overhead costs - total overhead costs) ÷  (total monthly overhead costs - total overhead costs)

= ($28,000  - $22,000) ÷ ($37,000 -  $25,000)

= $6,000 ÷ $12,000

= $0.50

We have to make the difference between the highest and the lowest overhead cost and then do the proportionate between them


Which of the following statements is FALSE? A. Government agencies are responsible for protecting the lives and property of their citizens and promoting their well-being. However, the government does not, and cannot, work alone.
B. Private and nonprofit sectors are encouraged to develop contingency plans and to work with State, tribal, and local planners to ensure that their plans are consistent with other pertinent plans.
C. While private-sector organizations are important in building resilient communities before an incident occurs, they play a limited role, if any, during an incident .
D. Nonprofit organizations bolster and support government efforts. These organizations collaborate with responders, governments at all levels, and other agencies and organizations.



While private-sector organizations are important in building resilient communities before an incident occurs, they play a limited role, if any, during an incident (C)


Private-sector organizations play an important role to compliment efforts of government agencies during disaster recovery activities.

Just as Non-profit organizations are supporting government efforts, private-sectors usually do the same in forms of corporate social responsibility.

Many private organizations also give financial aid to Non-profit organizations to support them in the course they have chosen which ultimately is towards supporting government efforts.


Assume the following information: You have $1,000,000 to invest Current spot rate of pound = $1.30 90 day forward rate of pound = $1.28 3 month deposit rate in U.S. = 3% 3 month deposit rate in Great Britain = 4% If you want to use covered interest arbitrage for a 90 day investment, you will buy pound at ______, and sell pound forward at ___________.a. $1,024,000. b. $1,030,000.
c. $1,040,000.
d. $1,034,000.
e. none of the above


Option A is the correct answer, $1,024,000. The supporting computations are given below. Kindly follow through step by step. Since the exchange rate is quoted, the following assertion is made:

"I'll purchase a pound for $1.30 and sell it 90 days later at $1.28," says the trader.

The steps were taken including:

- Exchange $1,000,000 for 769,230 pounds.

- Deposit 769,230 pounds at 4% interest for 800,000 pounds in 90 days.

- Finally, exchange 800,000 pounds for $1,024,000 pounds.

Learn more about the exchange rate here:


a. $1,024,000


The exchange rate is quoted, thus the statement is at below:

"I will buy pound at $1.30, and sell pound forward 90 days at $1.28."

The steps taken including:

- Exchange $1,000,000 to have 769,230 pounds

- Deposit 769,230 pounds at rate 4% to have 800,000 in 90 days

= 769,230 * (1 + 4%) = 800,000 pounds

- Then exchange 800,000 pound to have $1,024,000

= 800,000 * 1.28 = $1,024,000

(*) 4% in 90 days is quite unreasonable for Great Britain, but this is a text question then just accept it


Yasmin notices that her toothpaste label says that it will make the user smarter. She thinks this is an incorrect and misleading claim. Which government agency should she contact? 1. Bureau of Consumer Protection
2. National Credit Union Administration
3. Office of the Comptroller of the Currency
4. Securities and Exchange Commission




She should contact 1. Bureau of Consumer Protection.


Bureau of consumer protection is the agency in charge of overseeing if business malpractices such as false claims and guarantees like this affect the consumers .

Also, any seller must be responsible about the goods they sell to the consumers and are liable for compensation or more penalties if their goods/services harm the consumer or the society.


Bureau of Consumer Protection


The FTC’s Bureau of Consumer Protection stops unfair, deceptive and fraudulent business practices by:

collecting complaints and conducting investigations

suing companies and people that break the law

developing rules to maintain a fair marketplace

educating consumers and businesses about their rights and responsibilities

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