23. which of the following is not a common argument for trade protection? A. To
ID: 1104745 • Letter: 2
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23. which of the following is not a common argument for trade protection? A. To protect against civil unrest 8. To protect infant industries C To protect domestic jobs D. To ensure national security CHAPTER 9 QUESTIONS 24. Jacquelyn is a student explicit cost of her attending college? A. tuition B textbooks D. computer lab fees at a major state university. Which of the following is not an example of an 25. Sarah's accountant tels her that she made a profit of $43,002 running a pottery studio in Orlando Sarah's husband, an economist, claims Sarah lost $43,002 running her pottery studio. This means her husband is claiming that she incurred a. $86,004; implicit b. $43,002; implicit c. $43,002; explicit d. $86,004; explicit incosts _ _ 26. You decide to quit your $60,000 per year job as an information technology specialist and Mustrate children's books. At the end of the first year of illustrating, you have earne for paint and paper. Your economic profit in the first year as an ilustrator is: A) $15,000 d $20,000. You also spent $5,000 8) $20,000. C) -$40,000. D) -$45,000. CHAPTER 10 QUESTIONS Use the following diagram to answer the appropriate questionsExplanation / Answer
23.
3 common arguments of trade protection are - national security, domestic job creation, infant industry argument. Protect against civil unrest doesn't fall under common arguments for trade protection.
Answer- option A
24.
Explicit cost are the 'out of pocket cost'. For an university goer, tution, textbooks, computer lab fees etc are explicit cost as they are spending money from their own pocket for activities like these.
But, 'the salary that she could have earned working full time' is not an explicit cost but an implicit cost. As, it is the cost she faces without actually spending money i.e. it is the value of the alternative activity she has sacrificed.
Answer- option C
25. If Sarah has lost $43002 as an implicit cost(value of the alternative Sarah has sacrificed for running pottery studio) then the argument is true. Sarah's husband is talking about the opportunity cost of running the studio for Sarah.
Answer- option B
26. Economic profit= Total revenue - (explicit cost+ implicit cost)
Explicit cost(out of the pocket cost) = $5000
Implicit cost ( opportunity cost) = $60000
Total Revenue = $20000
Therefore, Economic profit =
= $20000 - $(60000+5000) = - $45000
Answer- option D
27. Marginal cost is the additional cost of producing 1 extra unit of output. Total cost of producing 1st sweatshirt is $9. Total cost of producing the second sweatshirt is $20. So, the additional cost i.e. Marginal cost of producing the second sweatshirt is $(20 - 9) = $11
Answer- option C
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