There Are Many Reasons Why a Firm Can Earn Above-Normal

question 69

Multiple Choice

There are many reasons why a firm can earn above-normal profits. These reasons include all of the following EXCEPT ____.

• A) access to superior labor or managerial talents
• B) superior access to financial resources at lower costs
• C) patent control of superior product designs
• D) ability of new firms to acquire necessary factors of production

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Definitions:

Form 1040

The typical form distributed by the Internal Revenue Service (IRS) for individuals to use when filing their yearly tax returns on income.

Straight-Line Depreciation

A method of calculating the depreciation of an asset by evenly spreading its cost over its useful life.

Tax Bracket

Ranges of income set by the government that determines the rate at which income is taxed.

Long-Term

Refers to holding an asset for more than a year before disposal, affecting the calculation of capital gains and losses for tax purposes.