Use the Following Information to Answer the Question(s)below

question 40

Multiple Choice

Use the following information to answer the question(s) below.
-The Market's average historical return is closest to:

• A)-2.50%.
• B)-3.33%.
• C)-4.33%.
• D)-5.17%.

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Definitions:

Variable Costs

Costs that change in proportion to the level of output or activity, such as raw materials, labor, and utilities.

Output

The quantity of goods or services produced by a business, industry, or country.

Normal Profit

The payment made by a firm to obtain and retain entrepreneurial ability; the minimum income that entrepreneurial ability must receive to induce entrepreneurs to provide their entrepreneurial ability to a firm; the level of accounting profit at which a firm generates an economic profit of zero after paying for entrepreneurial ability.

Implicit Cost

The monetary income a firm sacrifices when it uses a resource it owns rather than supplying the resource in the market; equal to what the resource could have earned in the best-paying alternative employment; includes a normal profit.