Question 1
You use $5,000 of your own money to start a dog-walking business. During the first year you earn a 5% return on your investment. If the current interest rate on savings is 8%, you earn an economic profit of
◦ -$150.
◦ $150.
◦ $250.
◦ $400.
Question 2
Payments made to shareholders of a corporation are called
◦ retained earnings.
◦ dividends.
◦ common stock.
◦ corporate bonds.