You Use $5,000 of Your Own Money to Start a Dog-Walking

question 167

Multiple Choice

You use $5,000 of your own money to start a dog-walking business. During the first year you earn a 5% return on your investment. If the current interest rate on savings is 8%, you earn an economic profit of

• A) -$150.
• B) $150.
• C) $250.
• D) $400.

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Definitions:

Equilibrium Output

The level of production in a market where the quantity supplied equals the quantity demanded, leading to a state of balance without excess supply or demand.

Migraine Headaches

A type of headache characterized by severe pain, often accompanied by nausea, vomiting, and sensitivity to light and sound.

Recurrent Attacks

Episodes that occur repeatedly over time, often referring to medical conditions such as seizures or migraines.

Exaggerated Sensitivity

An increased and often disproportionate emotional response to external stimuli.