Microeconomics
Which costs have already been incurred as a result of past decisions?
Sunk
Extremely high inflation is often called?
hyperinflation
A tax whose rates decrease as income rises is called?
Regressive tax
A legally imposed price above which market prices cannot rise is called _________________?
Price ceiling
What does the acronym ESOP stand for?
Employee stock-ownership plan
What is the practice of using credit or borrowed funds to increase the amount of capital managed by the owner so as to increase the return on equity?
Leverage
A graph of various market baskets that provide a consumer with equal utility.
Indifference curve
What is that phase of the business cycle during which the nation's output is declining ?
Recession
What U.S. act provided a grant of 160 acres to each family who settled on the land and lived there for five years?
Homestead Act
A merger between firms that sell dissimilar products would be what type?
Conglomerate merger.
In what type of partnership can an individual invest without full liability?
Limited Partnership
What form of business is owned by its customers?
Cooperative
Given a classical three-stage production function, during what stage is the elasticity of production less than zero?
Stage III
A graduated income tax does what to a cyclical economy?
Helps stabilize it.
When no person can be made better off without making someone else worse off, the situation is called:
Pareto optimum.
What economic concept is being applied when a spread is used in futures trading?
Arbitrage
What is the report that shows the financial condition of a business at a point in time, including its assets, liabilities, and equity?
Balance sheet
What capital budgeting method results in the number of years required to repay the original investment?
Payback
The cost to society associated with imperfect competition is called:
Deadweight loss
In the foreign currency market, what type of exchange is the basis for the United States dollar?
Floating rate of exchange.
What U.S. act established the land grant college system in the U.S?
Morill act
What type of economy allows international trade?
Open
One of the earliest theories of leadership, which suggested that great leaders are born, not made.
Great man theory
How would the earnings to sales ratio be calculated?
net income divided by sales
What term is defined as the percentage change in quantity demanded resulting from a 1 percent change in price?
Price elasticity
What term is used for the difference between the value of money and the cost of producing it?
Seigniorage
What is the public right to acquire property at the death of a person with no will or heirs?
escheat
Name the process of lowering prices after the introduction of a new product, in order to deter competitors and capture a larger portion of consumer surplus?
Price skimming.
What situation exists if a firm has more acceptable investment projects than it has funds available to invest?
Capital rationing
What is another name for a preliminary prospectus?
red herring