Which of the Following Items Is Most Likely to Be

question 129

Multiple Choice

Which of the following items is most likely to be an implicit cost of production?

• A) the "competitive rate" salary the owner of the business pays herself for services provided
• B) property taxes on a building owned by the firm
• C) rental payments for a building utilized by the company and rented from another party
• D) the interest income foregone on the equity capital invested by owners

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Definitions:

APC

Average Propensity to Consume, which is the fraction of income that is spent on consumption rather than savings.

Last 20 Years

Refers to the most recent two decades, a common time frame for analyzing changes and trends in economic, social, or technological domains.

Disposable Income

Net income available to households after taxes and other deductions, used for spending or saving.

GDP

GDP represents the sum total of all monetary values of goods and services produced inside a nation's boundaries over a given time frame.