What Are 'Menu Costs

question 24

Multiple Choice

What are 'menu costs'?

• A)The full list of a firm's costs of production.
• B)The costs to a firm of changing prices.
• C)The cost to a household of borrowing money when there is deflation.
• D)The opportunity cost of dining in a restaurant instead of at home.

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Definitions:

Deductions

Items of expenditure that the tax code allows taxpayers to deduct from income to arrive at taxable income.

Taxable Income

The portion of an individual's or company's income used as a base to calculate the amount of tax owed to the government.

Dependency Exemption

A tax exemption for taxpayers who support dependents who cannot fully support themselves.

Straight-Line Depreciation

A technique for distributing the expense of a physical asset evenly across its lifespan in yearly increments.