The Rules of the Game Refer to

question 22

Multiple Choice

The rules of the game refer to

• A)any factor that facilitates production and exchange,such as tax laws and property rights
• B)a gradual but consistent change in the price level until a fair price is attained
• C)the set of election laws that ensure that all elections are fair
• D)the requirements placed on firms in earning a profit
• E)the requirements that households must supply labor to firms

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Definitions:

Opportunity Costs

The cost of an alternative that must be foregone to pursue a certain action. Put another way, the benefits you could have received by taking an alternative action.

Make Total Cost

An approach to calculate the comprehensive cost of manufacturing a product, including raw materials, labor, and overheads.

Buy Total Cost

The total expense incurred to purchase an item or service, including the purchase price and any additional fees or expenses.

Variable Expenses

Costs that vary in total in direct proportion to changes in business activity levels or volumes, such as sales commissions or raw material costs.