Author Question: Suppose I have 1,000 to put into a one-year CD. Community Bank offers 5 percent interest, Floatbank ... (Read 75 times)

cmoore54 · **on:** Jun 30, 2018

Suppose I have 1,000 to put into a one-year CD. Community Bank offers 5 percent interest, Floatbank offers 5.25 percent, and Squidbank offers 5.40 percent. If I place my money in Squidbank, my economic profit on the investment is
a. 5.40 percent
b. 5 percent
c. 0.40 percent
d. 0.15 percent
e. -0.40 percent

Question 2

John moved his office from a building he was renting downtown to the carriage house he owns in back of his house. How will his profit change?
a. Implicit costs fall.
b. Explicit costs remain unchanged while implicit costs rise.
c. Economic profit must fall.
d. Explicit costs rise.
e. Accounting profit will rise.