Author Question: The monthly mortgage payments made by a homeowner are A) always sunk costs because the costs of ... (Read 97 times)

pragya sharda · **on:** Jun 29, 2018

The monthly mortgage payments made by a homeowner are

A) always sunk costs because the costs of constructing the house lie entirely in the past.
B) marginal costs if the house is new but sunk costs if it was purchased from a previous owner.
C) marginal costs of continuing to own and occupy the house.
D) not marginal costs because the house will continue to exist whether or not the payments are made.
E) sunk costs only if all the bills for earlier construction work have been fully paid.

Question 2

Suppose Ann can produce 8 units of a material good (M) or 4 units of a spiritual good (S) in a day, while Ben can produce only 3 Ms or 3 Ss in a day. Which statement below is true?

A) Ann is the most efficient producer of spiritual goods.
B) Ann is the most efficient producer of material goods.
C) Ben is the least efficient producer of spiritual goods.
D) All of the above are true.