Microeconomics 4th Edition

ISBN 13
978-1464143878
ISBN 10
1464143870
Authors
Paul Krugman, Robin Wells
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193 documents found.
449471
Exam Prep
BUS 11004
Suppose that each of the two firms in a duopoly has the independent choice of advertising or not advertising. If neither advertises, each gets $10 million in profit; if both advertise, their profits will be $5 million each; and if one advertises while the other does not, the advertiser gets
Microeconomics 4th Edition
448422
Exam Prep
BUS 17709
Figure: Marginal Private Benefits and Marginal Social Benefits (Figure: Marginal Private Benefits and Marginal Social Benefits) Look at the figure Marginal Private Benefits and Marginal Social Benefits. One way for the government to achieve this socially optimal level is by: A) imposing a per-unit tax equal to P1 " P2. B) providing a
Microeconomics 4th Edition
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Exam Prep
BUS 28991
The model suggesting that countries will specialize in producing the good that uses its relatively abundant factor of production most intensively is referred to as the _____ model. A) Heckscher"Ohlin B) absolute advantage C) sweatshop labor D) pauper labor fallacy Answer: A Answer: A Answer: A Figure: MSB and MSC of Pollution (Figure: MSB and MSC of
Microeconomics 4th Edition
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Exam Prep
BUS 31197
Suppose a person rolls a typical six-sided die. What is the probability that the die will come up with a 1 two times in a row? A) 1 in 6 B) 1 in 3 C) 1 in 36 D) 1 in 12 Answer: C Answer: C Answer: C Raclette is a popular wintertime dish in Switzerland. It
Microeconomics 4th Edition
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Exam Prep
BUS 32382
Answer: A Answer: A Answer: A Table: Lindsay's Farm (Table: Lindsay's Farm) Look at the table Lindsay's Farm. When Lindsay produces 50 units of produce, her total cost is: A) $250. B) $50. C) $200. D) $350. Answer: A Answer: A Answer: A Figure: Demand for Coconuts (Figure: Demand for Coconuts) Look at the figure Demand for Coconuts. If there is an
Microeconomics 4th Edition
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Exam Prep
BUS 37646
(Scenario: Linear Production Possibility Frontier) Look at the scenario Linear Production Possibility Frontier. Largetown CANNOT produce _____ shirts and _____ pairs of socks. A) 20; 0 B) 40; 40 C) 0; 40 D) 10; 20 Answer: B Answer: B Answer: B The United States must give up the production of 500 bicycles to produce 20 additional tractors.
Microeconomics 4th Edition
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Exam Prep
BUS 38050
You notice that when a new yoga class is offered at the student recreation center at a highly desirable time, some students from the other yoga classes go to the new class instead. This statement best represents this economic concept: A) Resources are scarce. B) The real cost of something is what
Microeconomics 4th Edition
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Exam Prep
BUS 39126
Monopolistic competition is similar to perfect competition because firms in both market structures: A) are price takers. B) produce goods that are perfect substitutes. C) find it beneficial to advertise. D) do not face any barriers to entry to the industry in the long run. Answer: D Answer: D Answer: D The addition to the total revenue from
Microeconomics 4th Edition
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Exam Prep
BUS 44395
Figure: Indifference Curves and Consumption Bundles (Figure: Indifference Curves and Consumption Bundles) Look at the figure Indifference Curves and Consumption Bundles. In the figure, the initial optimum is at a. The price of hot dogs increases, and the new equilibrium point is c. The change in hot dog consumption due to the income
Microeconomics 4th Edition
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Exam Prep
BUS 56328
As George ate pizza during one recent outing, he found that he enjoyed each additional slice less and less. This implies that his marginal benefit was: A) decreasing. B) increasing. C) constant. D) vertical. Answer: AAnswer: B Answer: AAnswer: B Answer: A Answer: B Decreasing and increasing returns to scale account for the shape of the: A) short-run average
Microeconomics 4th Edition
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Exam Prep
BUS 73922
(Table: Cakes) Look at the table Cakes. Pat is opening a bakery to make and sell special birthday cakes. She is trying to decide how many mixers to purchase. Her estimated fixed and average variable costs if she purchases one, two, or three mixers are shown in the table. Assume that average
Microeconomics 4th Edition
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Exam Prep
BUS 77399
The study of behavior in situations of interdependence is called: A) cost"benefit analysis. B) econometric theory. C) game theory. D) strategic theory. Answer: C Answer: C Answer: C Wendy sells ice-making machines. She can sell six per week at a price of $2,000 per machine. If she charges $2,100 per machine, she will sell only five per
Microeconomics 4th Edition
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Exam Prep
BUS 78234
Table: Denise's Consumption of Coffee and Gasoline (Table: Denise's Consumption of Coffee and Gasoline) Look at the table Denise's Consumption of Coffee and Gasoline. Suppose Denise initially chooses consumption bundle A. She can increase her total utility by: A) consuming more gasoline and less coffee. B) consuming more coffee and less gasoline. C) not
Microeconomics 4th Edition
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Exam Prep
BUS 80553
The incentives built into the market economy ensure that resources are put to good use and that opportunities to make people better off are not wasted. This means that: A) people usually are not selfish enough to exploit opportunities to make themselves better off. B) markets move toward equilibrium. C) resources should be
Microeconomics 4th Edition
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Exam Prep
BUS 81562
Because of tax competition, state and local taxes tend to be _____; however, federal taxes tend to be _____. A) regressive; regressive B) progressive; regressive C) progressive; progressive D) regressive; progressive Answer: D Answer: D Answer: D Jacquelyn is a student at a major state university. Which of the following is NOT an explicit cost of her
Microeconomics 4th Edition
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Exam Prep
BUS 85394
Which is NOT an example of a resource? A) land B) labor C) capital D) production Answer: D Answer: D Answer: D The quantity demanded of labor will decrease if: A) the price of the product that the labor produces increases. B) the productivity of labor increases. C) the price of labor rises. D) there is an increase in the supply of
Microeconomics 4th Edition
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Exam Prep
BUS 96610
There are several close substitutes for Quaker State oil but fewer substitutes for a complete checkup of your car's engine. We can expect the demand for: A) Quaker State oil to be more price-inelastic. B) the two to be equally price-elastic. C) car checkups to be more price-elastic. D) Quaker State oil to be
Microeconomics 4th Edition
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Exam Prep
BUS 97680
Figure: Consumer Equilibrium III (Figure: Consumer Equilibrium III) Look at the figure Consumer Equilibrium III. Kurt would maximize his utility at point _____ with the consumption of _____. A) B; Q6 and Q3 B) E; Q1 and Q7 C) F; Q5 and Q4 D) E; Q5 and Q2 Answer: D Answer: D Answer: D Answer:
Microeconomics 4th Edition
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Exam Prep
Chapter 1 – First Principles This Sometimes Causes The First Manager Send
Page 1 1. Microeconomics deals with: A) the working of the entire economy or large sectors of it. B) economic growth. C) individual decision makers in the economy. D) gross domestic product. 2. The study of a single firm and how it determines prices falls under the
Microeconomics 4th Edition
675890
Exam Prep
Chapter 10 – Appendix- Consumer Preferences And Consumer Choice Javon Consuming His Optimal Utility Maximizing Consumption Bundle
Page 1 1. An indifference curve is a line showing all of the consumption bundles that: A) an individual can purchase with a given income. B) yield the same total utility for an individual. C) yield the same marginal utility. D) have the same marginal rate of substitution.
Microeconomics 4th Edition
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Exam Prep
Chapter 10 – The Rational Consumer Reeses Peanut Butter Cups There Not Enough
Page 1 1. The relation between an individual's consumption bundle and her satisfaction is called a _____ function. A) demand B) production C) consumption D) utility 2. To say that you can't have too much of a good thing means that for any good that you enjoy
Microeconomics 4th Edition
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Exam Prep
Chapter 11 – Behind The Supply Curve- Inputs And Costs Cakes Look The Table Cakes Pat Opening
Page 1 1. A _____ is an organization that produces goods or services for sale. A) production function B) firm C) variable input D) fixed input 2. In the short run: A) all inputs are fixed. B) all inputs are variable. C) some inputs are fixed and
Microeconomics 4th Edition
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Exam Prep
Chapter 12 – Perfect Competition And The Supply Curve Lillys Output The Long Run Rise
Page 1 1. If a California avocado stand operates in a perfectly competitive market, that stand owner will be a price: A) maker. B) taker. C) discriminator. D) maximizer. 2. If all firms in an industry are price takers: A) each firm can sell at the price
Microeconomics 4th Edition
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Exam Prep
Chapter 13 – Monopoly Price Discriminating Firms Will Impose Price Structure That
Page 1 1. Market structures are categorized by: A) the number and size of the firms. B) whether products are differentiated and the extent of advertising. C) the number of firms and whether products are differentiated. D) the size of the firms and the extent of advertising.
Microeconomics 4th Edition
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Exam Prep
Chapter 14 – Oligopoly Gabriel Describes Two People Who Sell Handmade
Page 1 1. In an oligopoly: A) there are many sellers. B) there are no barriers to entry. C) firms recognize their interdependence. D) total surplus is maximized. 2. The most important source of oligopoly in an industry is: A) economies of scale. B) government regulation. C)
Microeconomics 4th Edition
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Exam Prep
Chapter 15 – Monopolistic Competition And Product Differentiation Profit Maximization Monopolistic Competition Look The Figure
Page 1 1. Which of the following industries is MOST likely to be monopolistically competitive? A) automobile production B) fresh bagel shops C) corn farming D) electric utility production 2. A monopolistically competitive industry, such as corn snack chips, and a perfectly competitive industry, like wheat farming,
Microeconomics 4th Edition
675914
Exam Prep
Chapter 16 – Externalities Page 116 Figure City With Two Polluters
Page 1 1. A market economy will produce _____ without any government regulation. A) too little pollution B) too much pollution C) the socially optimal amount of pollution D) the amount of pollution that maximizes total surplus 2. A negative externality: A) is any cost above the
Microeconomics 4th Edition
675918
Exam Prep
Chapter 17 – Public Goods And Common Resources Correcting For Market Failure The Government Forces
Page 1 1. Which of the following is an example of a nonexcludable good? A) health care B) national defense C) education D) ice cream 2. Which of the following goods BEST fits the characteristics of a private good? A) a professor giving a lecture in a
Microeconomics 4th Edition
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Exam Prep
Chapter 18 – The Economics Of The Welfare State True False 88 Technological Change The United
Page 1 1. Government payments to individuals for which no good or service exchanged are: A) spending. B) purchases. C) spending on goods and services. D) transfer payments. 2. Which of the following transactions is a transfer payment? A) The government pays an employee by making a
Microeconomics 4th Edition
675923
Exam Prep
Chapter 19 – Appendix- Indifference Curve Analysis Of Labor Supply Keisha Will Work Hours Because The
Page 1 1. Dorothy is trying to decide how to allocate her time between work and leisure. Suppose that she can work a maximum of 75 hours per week. If she can earn $15 per hour, the vertical intercept of her time allocation budget line (with income plotted vertically
Microeconomics 4th Edition
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Exam Prep
Chapter 19 – Factor Markets And The Distribution Of Income Page 152 Which The Following Does Not
Page 1 1. G. Reecy's Hamburger Joint is a fast-food restaurant. Which of the following is a factor of production? A) the raw meat used for the hamburgers B) the hamburger buns C) the cook D) the concentrate that is diluted to make the soft drinks 2.
Microeconomics 4th Edition
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Exam Prep
Chapter 20 – Uncertainty, Risk, And Private Information Microsoft Invests 1000 Apple There 40 Probability
Page 1 1. Louis has invested $1,000 in the stock market. At the end of one year, there is a 30% chance that his stock will be worth only $800 and a 70% chance that it will be worth $1,200. The expected value of his stock at the end
Microeconomics 4th Edition
675870
Exam Prep
Chapter 4 – Consumer And Producer Surplus Tuscaloosa The Price Burger 2 Consumer Surplus
Page 1 1. A consumer's willingness to pay reflects: A) the maximum price at which he or she would buy the good or service. B) the minimum price at which he or she would buy the good or service. C) the cost of producing the good or service. D)
Microeconomics 4th Edition
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Exam Prep
Chapter 5 – Price Controls And Quotas- Meddling With Markets Europe The Minimum Wage Has Led To
Page 1 1. A price control is: A) control of the price of a good by the firm that produces it. B) a legal restriction on how high or low a price in a market may go. C) an upper limit on the quantity of some good that can
Microeconomics 4th Edition
675875
Exam Prep
Chapter 6 – Elasticity Market For Pizza Income Changes From 1000
Page 1 1. The price elasticity of demand measures the responsiveness of the change in the: A) quantity demanded to a change in the price. B) price to a change in the quantity demanded. C) slope of the demand curve to a change in the price. D) slope of
Microeconomics 4th Edition
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Exam Prep
Chapter 7 – Taxes Page 148 Personal Income And Including 25000
Page 1 1. Suppose the government decides to fight obesity in America by imposing an excise tax based on the saturated fat content of food. The most likely effect of this tax would be to: A) lower the profits of ice cream suppliers. B) decrease revenue for the government.
Microeconomics 4th Edition
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Exam Prep
Chapter 9 – Decision Making By Individuals And Firms The Marginal Benefit Studying Economics For Two
Page 1 1. Jacquelyn is a student at a major state university. Which of the following is NOT an explicit cost of her attending college? A) tuition B) textbooks C) the salary that she could have earned working full-time D) computer lab fees 2. Which of the
Microeconomics 4th Edition
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Exam Prep
ECB 10678
To maximize her grade in economics, Stacey should study until: A) her marginal cost of studying begins to increase. B) her marginal benefit of studying begins to decrease. C) her marginal benefit of studying equals her marginal cost of studying. D) her marginal cost of studying reaches zero. Answer: C Answer: C Answer: C Prices are important
Microeconomics 4th Edition
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Exam Prep
ECB 11219
If an increase in the price of cotton increases total revenue, then the price effect is _____ the quantity effect. A) equal to B) stronger than C) weaker than D) not comparable to Answer: B Answer: B Answer: B (Table: Producer Surplus and Phantom Tickets) The table Producer Surplus and Phantom Tickets shows the minimum price at
Microeconomics 4th Edition
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Exam Prep
ECB 11889
The income effects of a change in price are most important for goods that: A) take up a substantial share of a consumer's spending. B) are very inexpensive. C) are imported. D) are normal. Answer: A Answer: A Answer: A Figure and Table: The Budget Line (Figure and Table: The Budget Line) Look at the figure and table
Microeconomics 4th Edition
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Exam Prep
ECB 12124
Which of the following scenarios is likely to provide the LEAST amount of economic usefulness? A) NFL player Peyton Manning is shown throwing a football in a toothpaste commercial. B) An online advertisement is posted at Cars.com for a 2005 Volvo S60 with 60,000 miles, a sunroof, and heated leather seats. C) An
Microeconomics 4th Edition
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Exam Prep
ECB 14385
The efficient level of pollution is the quantity at which: A) its total benefits exceed its total costs to society by the greatest possible amount. B) its total benefits to society equal its total costs to society. C) the marginal social benefit of an additional unit of pollution is greater than the marginal
Microeconomics 4th Edition
449206
Exam Prep
ECB 23226
Figure: The Market for Thumb Drives (Figure: The Market for Thumb Drives) Look at the figure The Market for Thumb Drives. Assume that PA is the autarky price, PW is the world price, and D and S represent domestic demand and supply, respectively. Consumer surplus in free trade equals the area: A)
Microeconomics 4th Edition
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Exam Prep
ECB 26291
Answer: AAnswer: A Answer: AAnswer: A Answer: A Answer: A Assume that diminishing marginal utility applies to both coffee and football tickets and that the consumer is spending all of her income. If a consumer purchases a combination of coffee and football tickets such that MUCoffee / PCoffee = 20 and MUFootballtickets / PFootballtickets =
Microeconomics 4th Edition
448952
Exam Prep
ECB 38476
If the marginal benefit received from consuming a good is less than the marginal cost of production: A) society's well-being can be improved if production increases. B) society's well-being can be improved if production decreases. C) society's well-being cannot be improved by changing production. D) the market is producing too little of the good. Answer:
Microeconomics 4th Edition
448447
Exam Prep
ECB 41060
Wenqin is a farmer, and in the short run she produces 100 bushels of wheat. Her average total cost per bushel is $1.75, total revenue is $450, and total fixed costs are $100. Wenqin's: A) average fixed cost is $1.50. B) profit per bushel is $2.75. C) average variable cost is $1.25. D) economic
Microeconomics 4th Edition
448467
Exam Prep
ECB 42861
If government decides to control the amount of a good allowed into a market, this will: A) always result in an increase in efficiency in the market. B) increase incentives for market participants to engage in black market activities. C) result in the equilibrium quantity being produced if the quota is binding. D) lead
Microeconomics 4th Edition
449770
Exam Prep
ECB 44283
Tony runs Read Economic Reports. If Tony finds that the cost of completing an additional report is $100 and someone offers him $125 to complete this additional report, Tony should: A) not complete the additional report, since he will incur a loss. B) complete the additional report but make the person buy
Microeconomics 4th Edition
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Exam Prep
ECB 49345
Answer: B Answer: B Answer: B Assume an economy moves from autarky to free international trade. In the export sector, consumer surplus _____, producer surplus _____, and the economy as a whole _____. A) rises; rises; gains B) rises; falls; gains C) falls; rises; gains D) falls; rises; loses Answer: C Answer: C Answer: C Answer: A Answer: A Answer: A If at
Microeconomics 4th Edition
448765
Exam Prep
ECB 53498
The price elasticity of a good will tend to be larger: A) the longer the relevant time. B) the fewer number of substitute goods available. C) if it is a staple. D) if it is relatively inexpensive. Answer: A Answer: A Answer: A The price of popcorn is $0.50 per box and the price of peanuts is
Microeconomics 4th Edition
449712
Exam Prep
ECB 61386
Answer: A Answer: A Answer: A (Figure: Wine and Wheat) Look at the figure Wine and Wheat. The opportunity cost of moving from producing ONLY wheat to producing at point D is _____ tons of wheat. A) 3 B) 6 C) 9 D) 15 Answer: Answer: Answer: A A A When some people know things that other people don't know,
Microeconomics 4th Edition
449362
Exam Prep
ECB 63249
If a firm operating in monopolistic competition is producing a quantity that generates MC = MR, then the marginal decision rule tells us that profit: A) is maximized. B) can be increased by decreasing production. C) can be increased by decreasing the price. D) is maximized only if MC = P. Answer: AAnswer:
Microeconomics 4th Edition
448604
Exam Prep
ECB 64133
Chile has a comparative advantage over the United States in copper. Which of the following is a source of this comparative advantage? A) mild temperatures B) large deposits of copper ore C) no opportunity cost associated with copper production D) high tariffs on copper from other nations Answer: B Answer: B Answer: B Figure: Production Possibilities and
Microeconomics 4th Edition
448265
Exam Prep
ECB 67299
If a decision maker chooses an option that leaves him or her worse off than choosing another available option, he or she is: A) using bounded rationality. B) basing the decision on risk aversion. C) making an irrational decision. D) making a rational decision. Answer: C Answer: C Answer: C People who live in large cities decide
Microeconomics 4th Edition
449250
Exam Prep
ECB 71336
Figure: Monopolistic Competition II (Figure: Monopolistic Competition II) Which panel(s) in the figure Monopolistic Competition II show(s) a monopolistic competitor producing where price is greater than marginal revenue? A) panel (a) B) panel (b) C) panel (c) D) panels (a), (b), and (c) Answer: DAnswer: B Answer: DAnswer: B Answer: D Answer: B Answer: A Answer: A Answer: A As the premium for
Microeconomics 4th Edition
448481
Exam Prep
ECB 71782
Figure: Collusion (Figure: Collusion) Look at the figure Collusion. The price charged by the industry with collusion is shown by: A) W. B) X. C) Y. D) Z. Answer: A Answer: A Answer: A Suppose the government imposes a $10 excise tax on the sale of sweaters by charging suppliers $10 for each sweater sold. If
Microeconomics 4th Edition
449760
Exam Prep
ECB 78347
Unwritten or unspoken understandings through which firms restrict competition are called: A) cartel agreements. B) oligopoly agreements. C) overt collusion. D) tacit collusion. Answer: D Answer: D Answer: D If the government imposes binding rent control: A) rent will be set above the equilibrium price. B) it may result in some landlords leaving the business because they cannot cover
Microeconomics 4th Edition
448172
Exam Prep
ECB 79176
(Table: The Demand for Chocolate-Covered Peanuts) Look at the table The Demand for Chocolate-Covered Peanuts. If George, Barbara, and Dan are the only three buyers in the market and the price of a bag of chocolate-covered peanuts is $0.80, the total market quantity demanded is _____ bags per month. A) 70 B) 80 C) 105 D)
Microeconomics 4th Edition
449796
Exam Prep
ECB 81381
Common resources tend to be _____ in private markets. A) priced too high B) efficiently priced C) overconsumed D) underconsumed Answer: C Answer: C Answer: C The strategy of investing in several assets so that any possible losses are independent events is: A) diversification. B) private information. C) moral hazard. D) adverse selection. Answer: A Answer: A Answer: A Answer: A Answer: A Answer: A If there
Microeconomics 4th Edition
448852
Exam Prep
ECB 82962
The average total cost curve has a U shape because the ______ effect is dominant at low levels of output, and the _____ effect is dominant at high levels of output. A) diminishing returns; spreading B) spreading; diminishing returns C) comparative advantage; absolute advantage D) absolute advantage; comparative advantage Answer: B Answer: B Answer: B (Table: Production
Microeconomics 4th Edition
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Exam Prep
ECB 85601
For some people, coffee and milk are perfect complements. Their indifference curves are: A) right angles. B) straight lines between the X and Y axis. C) straight lines out of the origin. D) regular downward-sloping indifference curves, but their budget lines are right angles. Answer: A Answer: A Answer: A If a person's marginal utility from an
Microeconomics 4th Edition
448330
Exam Prep
ECB 85775
(Table: Production Possibilities Schedule I) Look at the table Production Possibilities Schedule I. If the economy produces 10 units of capital goods per period, it also can produce at most _____ units of consumer goods per period. A) 5 B) 4 C) 3 D) 2 Answer: B Answer: B Answer: B Suppose government officials have set an emissions
Microeconomics 4th Edition
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Exam Prep
ECB 89333
Answer: AAnswer: BAnswer: B Answer: AAnswer: BAnswer: B Answer: A Answer: B Answer: B Which of these is one of the four principles of individual choice? A) Resources are usually renewable. B) The real cost of something is impossible to measure. C) People take advantage of opportunities to make themselves better off only if there is no risk
Microeconomics 4th Edition
448159
Exam Prep
ECB 89359
Figure: Production Possibility Frontier (Figure: Production Possibility Frontier) Look at the figure Production Possibilities Frontier. This production possibility frontier is: A) bowed out because of increasing opportunity costs. B) bowed in because of increasing opportunity costs. C) bowed in because of constant cost of cars and computers. D) linear because of constant costs. Answer: A Answer:
Microeconomics 4th Edition
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Exam Prep
ECB 90669
A strategy that is the same regardless of the action of the other player in a game is a _____ strategy. A) competitive B) trigger C) dominant D) tit-for-tat Answer: C Answer: C Answer: C Figure: Computing Monopoly Profit (Figure: Computing Monopoly Profit) Look at the figure Computing Monopoly Profit. The profit-maximizing price is _____ and will generate
Microeconomics 4th Edition
449418
Exam Prep
ECB 92877 If A Monopolist Is
If a monopolist is producing a quantity that generates MC < MR, then profit: A) is maximized. B) is maximized only if MC = P. C) can be increased by increasing production. D) can be increased by decreasing production. Answer: C Answer: C Answer: C Figure: Income Tax Payments (Figure: Income Tax Payments) Look at the figure
Microeconomics 4th Edition
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Exam Prep
ECB 98429
The 1890 law intended to prevent the establishment of more monopolies and to break up existing ones in the United States was the: A) Taft-Hartley Act. B) Sherman Antitrust Act. C) Affordable Care Act. D) Federal Trade Commission Act Answer: B Answer: B Answer: B Taxes on the purchase of specific items such as gasoline, cigarettes, or
Microeconomics 4th Edition
449185
Exam Prep
ECON 10514
Answer: AAnswer: A Answer: AAnswer: A Answer: A Answer: A Prices above equilibrium on agricultural products like milk exist to maximize the consumer surplus. Answer: B Answer: B Answer: B Figure: Market I (Figure: Market I) Look at the figure Market I. A price floor at $15 would result in deadweight loss of: A) $9. B) $10. C) $20. D) $40.50. Answer: C Answer:
Microeconomics 4th Edition
448889
Exam Prep
ECON 10783
If quantity supplied responds substantially to a relatively small change in price, supply is: A) price-elastic. B) price-inelastic. C) negatively sloped. D) insensitive to changes in price. Answer: A Answer: A Answer: A Along a given supply curve, an increase in the price of a good will: A) increase producer surplus. B) decrease producer surplus. C) increase consumer surplus. D) decrease
Microeconomics 4th Edition
448417
Exam Prep
ECON 10862
Mikail's perfectly competitive camera memory card"producing factory is making positive economic profits. If the price of memory cards is $9, if Mikail's output is 3,000 cards a month, and if his monthly average total cost is $7, what are his monthly profits? A) $6,000 B) $27,000 C) $21,000 D) $2 Answer: A Answer: A Answer: A Which
Microeconomics 4th Edition
449878
Exam Prep
ECON 13297
Answer: AAnswer: A Answer: AAnswer: A Answer: A Answer: A An unwritten, unspoken agreement through which firms limit competition among themselves is called: A) satisfying. B) tacit collusion. C) overt collusion. D) a cartel. Answer: B Answer: B Answer: B Which of the following U.S. welfare programs is a means-tested in-kind benefit? A) Social Security B) Temporary Assistance to Needy Families C) food stamps D)
Microeconomics 4th Edition
449694
Exam Prep
ECON 24167
Figure: The Linear Demand Curve (Figure: The Linear Demand Curve) Look at the figure The Linear Demand Curve. If you increase the price of your scarves from $7 to $8, your total revenue will _____, and you notice that your price elasticity of demand is _____. A) increase; elastic B) decrease; elastic C) increase; inelastic D)
Microeconomics 4th Edition
448371
Exam Prep
ECON 25214
Pizza is a normal good. If students' incomes at your college increase, the effect on pizza will be: A) an increase in the demand. B) an increase in the quantity demanded. C) a decrease in the demand. D) no change in the demand. Answer: A Answer: A Answer: A The law of demand is illustrated by a demand
Microeconomics 4th Edition
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Exam Prep
ECON 25939
In the short run, as output gets larger: A) fixed cost gets smaller. B) the average variable cost curve gets closer to the average total cost curve. C) marginal cost gets smaller. D) average total cost decreases after the point of diminishing returns. Answer: BAnswer: A Answer: BAnswer: A Answer: B Answer: A If minimum wages are set
Microeconomics 4th Edition
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Exam Prep
ECON 27429
Figure: Indifference Curves and Consumption Bundles (Figure: Indifference Curves and Consumption Bundles) Look at the figure Indifference Curves and Consumption Bundles. For this consumer pizza is a(n) _____ good and hot dogs are a(n) _____ good. A) normal; inferior B) inferior; normal C) normal; normal D) inferior; inferior Answer: C Answer: C Answer: C Figure: Budget Lines for Oranges
Microeconomics 4th Edition
449053
Exam Prep
ECON 31063
Producers of artificially scarce goods face _____ that are similar to those of natural monopolists; they decline over the relevant range of output. A) external benefits B) external costs C) total fixed costs D) average total costs Answer: DAnswer: A Answer: DAnswer: A Answer: D Answer: A Answer: B Answer: B Answer: B Which of the following pairs of goods are
Microeconomics 4th Edition
449559
Exam Prep
ECON 31365
Figure: Demand Curves (Figure: Demand Curves) Look at the figure Demand Curves. Which graph shows a perfectly elastic demand curve? A) A B) B C) C D) D Answer: D Answer: D Answer: D Marginal cost can be calculated as: A) DTC / DQ, where TC is total cost and Q is output. B) DVC / DQ, where VC is variable
Microeconomics 4th Edition
449374
Exam Prep
ECON 39903
When comparing the characteristics of common resources and artificially scarce goods, we find that: A) they are both nonrival in consumption. B) they are both excludable. C) common resources are nonrival in consumption (while artificially scarce goods are not), and artificially scarce goods are nonexcludable (while common resources are not). D) artificially scarce goods
Microeconomics 4th Edition
449409
Exam Prep
ECON 40153
If at a given quantity _____, the decision maker should do _____ of the activity. A) MB < MC; that amount B) MB < MC; less C) MB > MC; less D) MB > MC; none Answer: B Answer: B Answer: B (Table: Alaina's Utility from Consuming Cups of Coffee) Look at the table Alaina's Utility from
Microeconomics 4th Edition
448500
Exam Prep
ECON 41689
The demand curve for a monopoly is: A) the MC curve above the AVC curve. B) the MR curve above the horizontal axis. C) identical to the MR curve. D) also the industry demand curve. Answer: D Answer: D Answer: D Suppose the elasticity of demand for tickets to Broadway shows is 2.0 for men and
Microeconomics 4th Edition
449275
Exam Prep
ECON 45706
Dorothy is trying to decide how to allocate her time between work and leisure. Suppose that she can work a maximum of 75 hours per week. If she can earn $15 per hour, the vertical intercept of her time allocation budget line (with income plotted vertically and leisure plotted horizontally) is: A)
Microeconomics 4th Edition
448597
Exam Prep
ECON 48118
A recent news story reported that the Organization of Petroleum Exporting Countries is expected to decrease the supply of oil next summer. Summer is traditionally a time of increased demand for oil because of vacation travel. What would be the combined effect of these two events on the summer market
Microeconomics 4th Edition
449297
Exam Prep
ECON 60038
(Table: Marginal Utility per Dollar of M&Ms) Look at the table Marginal Utility per Dollar of M&Ms. The price of M&Ms is $2 per bag. If the price of M&Ms decreases to $1 per bag, the marginal utility per dollar for each bag of M&Ms will: A) increase. B) decrease. C) remain constant. D)
Microeconomics 4th Edition
448524
Exam Prep
ECON 63337
Answer: AAnswer: A Answer: AAnswer: A Answer: A Answer: A Figure: Consumer and Capital Goods (Figure: Consumer and Capital Goods) Look at the figure Consumer and Capital Goods. The movement from curve 1 to curve 2 indicates: A) a growing ability of the economy to produce capital and consumer goods. B) going from unemployment to full
Microeconomics 4th Edition
448515
Exam Prep
ECON 64084
If the government decides to impose a $700 tax on U.S. citizens vacationing abroad, then the deadweight loss from this tax will be: A) relatively small. B) relatively large. C) zero. D) absorbed by foreign governments. Answer: B Answer: B Answer: B Figure: Water Works (Figure: Water Works) Look at the figure Water Works, which describes a small
Microeconomics 4th Edition
448298
Exam Prep
ECON 69900
The market for milk is initially in equilibrium. Milk producers successfully advertise to encourage milk drinking. At the same time, more milk producers enter the market. Standard demand and supply analysis tells us that: A) the equilibrium price and quantity of milk will rise. B) the equilibrium price and quantity of milk
Microeconomics 4th Edition
449915
Exam Prep
ECON 72215
All else equal, if a price floor above the equilibrium is imposed on a market and the government buys the surplus, consumer surplus will _____ and producer surplus will _____. A) fall; rise B) fall; fall C) rise; fall D) rise; rise Answer: AAnswer: B Answer: AAnswer: B Answer: A Answer: B LaToya sees honey and sugar as
Microeconomics 4th Edition
449892
Exam Prep
ECON 72867
There are several close substitutes for Bayer aspirin but fewer substitutes for a complete medical examination. Therefore, all other things equal, you would expect the demand for: A) medical exams to be more price-elastic. B) Bayer aspirin to be more price-elastic. C) Bayer aspirin to be more price-inelastic. D) the two to be equally price-elastic.
Microeconomics 4th Edition
448317
Exam Prep
ECON 72901
Deadweight losses arising from an excise tax are greatest when demand: A) and supply are relatively inelastic. B) is relatively inelastic and supply is relatively elastic C) is relatively elastic and supply is relatively inelastic. D) and supply are relatively elastic. Answer: D Answer: D Answer: D When a firm is a perfect competitor in the product
Microeconomics 4th Edition
449544
Exam Prep
ECON 73312
(Table: Trade-off of Study Time and Leisure Time) Look at the table Trade-off of Study Time and Leisure Time. A student sleeps 8 hours per day and divides the remaining time between study time and leisure time. The table shows the combinations of study and leisure time that can
Microeconomics 4th Edition
449383
Exam Prep
ECON 76475
Figure: The Market for Yachts (Figure: The Market for Yachts) Look at the figure The Market for Yachts. A price _____ of _____ will bring the about the same price and output in the market for yachts as would an excise tax of $60,000. A) ceiling; $80,000 B) ceiling; $100,000 C) floor; $100,000 D) floor;
Microeconomics 4th Edition
449479
Exam Prep
ECON 77096
Suppose the government levies a $4 per month excise tax on cable TV. If the demand for cable TV is relatively (but not perfectly) inelastic and the supply curve is relatively (but not perfectly) elastic, then the price of cable TV will: A) increase by more than $4. B) increase by exactly
Microeconomics 4th Edition
449681
Exam Prep
ECON 87306
Krista's dry-cleaning business incurs $900 per month in fixed costs. Last month her total output was 3,000 pounds of clothes. This month her total output fell to 2,700 pounds. This means her average fixed cost _____ by a little more than _____. A) fell; 3.33 cents B) increased; 3.33 cents C) fell; 2.50
Microeconomics 4th Edition
448753
Exam Prep
ECON 92172
Figure: Gain in Consumer Surplus (Figure: Gain in Consumer Surplus) Look at the figure Gain in Consumer Surplus. Identify the area or areas that represent the total change in consumer surplus when the price falls from P1 to P2. A) A and B B) B and C C) D and E D) A, B, and
Microeconomics 4th Edition
449116
Exam Prep
ECON 94334
Figure: Market Failure (Figure: Market Failure) In the figure Market Failure, if production in this competitive market is at quantity E: A) marginal benefit is equal to marginal cost. B) marginal benefit is less than marginal cost. C) marginal benefit is greater than marginal cost. D) price is equal to marginal cost and greater than
Microeconomics 4th Edition
449827
Exam Prep
ECON 95065
Table: The Lemonade Market Price of Lemonade (per cup) Number of Cups Demanded (QD) Number of Cups Supplied (QS) $0.50 250 25 0.75 200 50 1.00 150 75 1.25 100 100 1.50 50 125 1.75 20 150 (Table: The Lemonade Market) Look at the table The Lemonade Market. If the price of
Microeconomics 4th Edition
449865
Exam Prep
ECON 98377
Figure: The Demand for Shirts (Figure: The Demand for Shirts) Look at the figure The Demand for Shirts. The price elasticity of demand, by the midpoint method, for the segment FG is approximately: A) 0. B) 0.09. C) 0.5. D) greater than 1. Answer: B Answer: B Answer: B Answer: B Answer: B Answer: B Sunk costs: A) affect economic profit. B) are the
Microeconomics 4th Edition
449460
Exam Prep
ECON A 10205
If the price is consistently below the average variable cost, then in the short run a perfectly competitive firm should: A) raise the price. B) sell more output. C) shut down. D) lower the price to sell more. Answer: C Answer: C Answer: C (Table: Demand Schedule for Gadgets) Look at the table Demand Schedule for Gadgets.
Microeconomics 4th Edition
448679
Exam Prep
ECON A 14289
(Table: Quantity Supplied and Quantity Demanded) Look at the table Quantity Supplied and Quantity Demanded. If a price ceiling of $10 is imposed in this market: A) the quantity demanded will be greater than the quantity supplied. B) the quantity supplied will be greater than the quantity demanded. C) an equilibrium quantity will result. D)
Microeconomics 4th Edition
449854
Exam Prep
ECON A 19307
In the United States, payments to labor account for: A) 70% of total income, a share that has not fluctuated much in the past 30 years. B) 50% of total income, but the returns to land have been increasing. C) only 30% of total income, and this number is falling. D) 90% of income
Microeconomics 4th Edition
449744
Exam Prep
ECON A 23344
Figure: The Market for Yachts (Figure: The Market for Yachts) Look at the figure The Market for Yachts. A price _____ of _____ will bring about the same price and output in the market for yachts as would an excise tax of $30,000. A) ceiling; $80,000 B) ceiling; $100,000 C) floor; $120,000 D) floor; $140,000 Answer:
Microeconomics 4th Edition
449815
Exam Prep
ECON A 23745
If two goods are complements, their cross-price elasticity of demand is: A) less than 0. B) equal to 0. C) positive but almost equal to 0. D) greater than 0. Answer: A Answer: A Answer: A (Table: Marginal and Total Benefit) Look at the table Marginal and Total Benefit. Sed is deciding how many football games he wants
Microeconomics 4th Edition
448582
Exam Prep
ECON A 27491
Figure: The Average Total Cost Curve (Figure: The Average Total Cost Curve) Look at the figure The Average Total Cost Curve. The total cost of producing 10 pairs of boots is approximately: A) $13. B) $54. C) $131. D) $1,308. Answer: D Answer: D Answer: D Figure: Rent Controls (Figure: Rent Controls) Look at the figure Rent Controls. If
Microeconomics 4th Edition
449514
Exam Prep
ECON A 42364
(Table: Demand Schedule for Gadgets) Look at the table Demand Schedule for Gadgets. The market for gadgets consists of two producers, Margaret and Ray. Each firm can produce gadgets with no marginal cost or fixed cost. If these two producers formed a cartel and acted to maximize total industry profits,
Microeconomics 4th Edition
449304
Exam Prep
ECON A 46194
Answer: B Answer: B Answer: B The income elasticity of demand measures: A) how much the quantity demanded changes in response to a price change. B) how much a consumer can buy at given income levels. C) how much consumer purchasing power is affected when prices change. D) how the quantity demanded of a good changes in
Microeconomics 4th Edition
448690
Exam Prep
ECON A 46803
Accountants use only _____ costs in their computations. A) opportunity B) implicit C) explicit D) variable Answer: CAnswer: B Answer: CAnswer: B Answer: C Answer: B Moral hazard: A) occurs when incentives are distorted because an individual knows more about his or her own actions than other people do. B) is a term used to describe the bonuses paid for
Microeconomics 4th Edition
448148
Exam Prep
ECON A 49140
Restrictions on free international trade designed to insulate domestic industries from competitive market forces that originate beyond the borders of the country are _____ policies. A) competitive B) protectionist C) free-trade D) antitrust Answer: B Answer: B Answer: B Some highways have one lane; others have two, three, or more. If each lane costs $10 million per
Microeconomics 4th Edition
448214
Exam Prep
ECON A 50878
Figure: Market for Hamburgers (Figure: The Market for Hamburgers) The figure The Market for Hamburgers shows the weekly market for hamburgers in Irvine, Kentucky. If 400 hamburgers are sold, producer surplus will equal: A) $650. B) $400. C) $510. D) $200. Answer: D Answer: D Answer: D An increase in supply is caused by: A) an increase in input prices. B)
Microeconomics 4th Edition
448134
Exam Prep
ECON A 55185
If the price elasticity of supply is: A) greater than 1, then the supply is price-elastic. B) greater than 1, then the supply is price-inelastic. C) zero, then the supply is price unit-elastic. D) greater than 1, then the quantity supplied is relatively unresponsive to price changes. Answer: A Answer: A Answer: A Scenario: Countries A and B
Microeconomics 4th Edition
449637
Exam Prep
ECON A 58937
Answer: AAnswer: A Answer: AAnswer: A Answer: A Answer: A As you consume more turkey relative to mashed potatoes, the _____ of turkey eventually decreases. A) price B) usefulness C) marginal utility D) demand Answer: CAnswer: B Answer: CAnswer: B Answer: C Answer: B Figure: The Demand for Bricklayers (Figure: The Demand for Bricklayers) Look at the figure The Demand for Bricklayers. If
Microeconomics 4th Edition
449654
Exam Prep
ECON A 60526
The sources of product differentiation do NOT include: A) differences in location. B) differences in quality. C) the perception by consumers that products are different, even if they are physically identical. D) consumers' value in uniformity. Answer: D Answer: D Answer: D Figure: Strawberries and Submarines II (Figure: Strawberries and Submarines II) Look at the figure Strawberries
Microeconomics 4th Edition
448814
Exam Prep
ECON A 64921
Figure: The Value of the Marginal Product Curve (Figure: The Value of the Marginal Product Curve) In the figure The Value of the Marginal Product Curve, the VMPL curve will shift to the right if: A) the wage rate increases. B) a technological advance makes labor more productive. C) the price of the good
Microeconomics 4th Edition
448721
Exam Prep
ECON A 68494
If the extra output that is produced by hiring one more unit of labor adds more to _____ than to _____, the firm will increase its profit by increasing the use of labor. A) total cost; total revenue B) total revenue; total cost C) marginal cost; marginal revenue D) marginal product; marginal cost Answer: B Answer:
Microeconomics 4th Edition
448405
Exam Prep
ECON A 71389
Figure: The Market for Yachts (Figure: The Market for Yachts) Look at the figure The Market for Yachts. If the government imposes a $30,000 tax on yachts (collected from the producers), consumers will pay _____ of the tax and producers will pay _____. A) $20,000; $10,000 B) $15,000; $15,000 C) $10,000; $20,000 D) $5,000; $25,000 Answer:
Microeconomics 4th Edition
448981
Exam Prep
ECON A 72070
(Table: Demand Schedule for Gadgets) Look at the table Demand Schedule for Gadgets. The market for gadgets consists of two producers, Margaret and Ray. Each firm can produce gadgets with no marginal cost or fixed cost. If these two producers formed a cartel, split the production of output equally, and
Microeconomics 4th Edition
449241
Exam Prep
ECON A 72919
Workers in China earn low wages relative to world standards. A person who believes trade must be bad for workers in China because of this adheres to the: A) sweatshop labor fallacy. B) Heckscher"Ohlin theory. C) pauper labor fallacy. D) theory of absolute advantage. Answer: A Answer: A Answer: A (Table: Total Utility of Income After College
Microeconomics 4th Edition
449153
Exam Prep
ECON A 77664
Figure and Table: An Indifference Curve Map (Figure and Table: Indifference Curve Map) Look at the figure and table An Indifference Curve Map. Combination _____ is preferred to combination _____. A) A; B B) B; D C) C; A D) B; C Answer: D Answer: D Answer: D (Table: Cherry Farm) Look at the table
Microeconomics 4th Edition
449004
Exam Prep
ECON A 84182
Figure: Monopolistic Competition VI (Figure: Monopolistic Competition VI) The figure Monopolistic Competition VI illustrates a firm in the _____; in the _____, the demand and marginal revenue curves will shift to the _____. A) short run; long run; right B) long run; short run; left C) short run; long run; left D) long run; short
Microeconomics 4th Edition
449070
Exam Prep
ECON A 91078
Figure: The Profit-Maximizing Output and Price (Figure: The Profit-Maximizing Output and Price) Look at the figure The Profit-Maximizing Output and Price. Assume that there are no fixed costs and AC = MC = $200. At the profit-maximizing output and price for a monopolist, total surplus is: A) $3,200. B) $4,800 C) $1,000. D) $1,600.
Microeconomics 4th Edition
449259
Exam Prep
ECON E 13555
Jeanette is willing to pay $100 for the first pair of shoes, $80 for the second pair, $50 for the third, and $30 for the fourth. If shoes cost $50, Jeanette will buy _____ pairs of shoes and her total consumer surplus equals _____. A) four; $110 B) three; $230 C) three; $80 D)
Microeconomics 4th Edition
449316
Exam Prep
ECON E 17411
Figure: The Demand for Bricklayers (Figure: The Demand for Bricklayers) Look at the figure The Demand for Bricklayers. If there is an increase in technology that increases the productivity of bricklayers, then the value of the marginal product of the sixth bricklayer will be _____ than _____. A) less; $80 B) greater; $100 C)
Microeconomics 4th Edition
449438
Exam Prep
ECON E 19852
(Table: Cherry Farm) Look at the table Cherry Farm. How much will the industry produce in long-run equilibrium? A) 600 pounds B) 500 pounds C) 400 pounds D) 0 pounds Answer: C Answer: C Answer: C (Table: Value of the Marginal Product of Labor and Demand) In the figure Value of the Marginal Product of Labor and
Microeconomics 4th Edition
448936
Exam Prep
ECON E 22264
Suppose the price elasticity of demand for blueberries is 1.5. If climate change destroys one-fourth of the nation's blueberry crop, how will that affect total revenue, all other things unchanged? A) Total revenue will rise. B) Total revenue will fall. C) Total revenue will remain unchanged. D) The information is insufficient to answer the
Microeconomics 4th Edition
449781
Exam Prep
ECON E 23213
(Table: Competitive Market for Good Z) Look at the table Competitive Market for Good Z. If the demand curve for good Z is linear, it can be expressed as: A) Qd = 3P. B) Qd = 50 " 2P. C) Qd = Qs. D) Qd = 100 " 2P. Answer: B Answer: B Answer: B Peanut butter
Microeconomics 4th Edition
449675
Exam Prep
ECON E 23486
Which of the following is an example of individual choice? A) The government announces plans to ban smoking in all Florida restaurants. B) Lauren spends her allowance on pillows for her bed. C) France decides to withhold funding to rebuild Iraq. D) Africa decides to accept U.S. aid for humanitarian efforts. Answer: B Answer: B Answer: B The
Microeconomics 4th Edition
449227
Exam Prep
ECON E 37328
Which of the following best describes the income effect of a price increase? A) The price of bacon increases, so Michelle buys more sausage. B) The price of corn chips increases, so Michelle buys potato chips. C) The tuition at the public university increases, so Michelle attends a community college. D) Michelle's apartment rent
Microeconomics 4th Edition
448735
Exam Prep
ECON E 37805
Answer: B Answer: B Answer: B Scenario: Monopolist The demand curve for a monopolist is P = 75 " 0.5Q, and the monopolist has the following MC expressed as P = 2Q. Assume also that ATC at the profit-maximizing level of production is equal to $12.50. (Scenario: Monopolist) Look at the scenario Monopolist. The deadweight
Microeconomics 4th Edition
449752
Exam Prep
ECON E 39256
Assume that two combinations of two goods yield the same level of satisfaction. We can conclude that these combinations are always on: A) the same price line. B) the same budget constraint. C) the same indifference curve. D) different indifference curves. Answer: C Answer: C Answer: C Figure: Budget Lines for Oranges and Apples (Figure: Budget Lines for
Microeconomics 4th Edition
448780
Exam Prep
ECON E 40253
If a good has a price-inelastic demand, then which of the following is NOT likely to be characteristic of this good? A) It is a necessity and is relatively small proportion of the household budget. B) It has many substitutes. C) Consumers spend a small percentage of their income on it. D) Consumers do
Microeconomics 4th Edition
448624
Exam Prep
ECON E 44658
Which of the following statements concerning monopoly is TRUE? A) Monopoly firms are always larger than perfectly competitive firms. B) A monopoly has no rivals. C) Barriers to entry do not prevent other firms from entering a monopolized industry. D) Monopolists produce more output than a competitive market with the same demand and cost
Microeconomics 4th Edition
448227
Exam Prep
ECON E 46204
Figure: The Marginal Decision Rule (Figure: Marginal Decision Rule) Look at the figure The Marginal Decision Rule. To the left of point C (e.g., at q1): A) economic profit is the vertical distance between curves B and MC. B) the firm is not maximizing profits. C) the firm is maximizing profits. D) the firm
Microeconomics 4th Edition
448306
Exam Prep
ECON E 51562
A cartel is an example of: A) price extortion. B) price leadership. C) overt collusion. D) perfect competition. Answer: C Answer: C Answer: C If they spend all night writing computer programs, Laurence can write 10 programs, and Carrie Anne can write 5. If they spend all night making sunglasses, Laurence can make 6 pairs, and Carrie
Microeconomics 4th Edition
449402
Exam Prep
ECON E 55454
Figure: The Profit-Maximizing Output and Price (Figure: The Profit-Maximizing Output and Price) Look at the figure The Profit-Maximizing Output and Price. Assume that there are no fixed costs and AC = MC = $200. At the profit-maximizing output and price for a perfectly competitive industry, deadweight loss is: A) $0. B) $200. C) $1,600. D)
Microeconomics 4th Edition
449503
Exam Prep
ECON E 55527
Answer: A Answer: A Answer: A The trade-off between work and leisure underlying the supply of labor involves the income effect and the _____ effect. A) substitution B) elasticity C) production D) wage Answer: A Answer: A Answer: A Which of the following is NOT a reason that markets usually lead to efficiency? A) People are naturally efficient. B) Individuals have incentives
Microeconomics 4th Edition
449092
Exam Prep
ECON E 58289
Assume the supply curve shifts to the right by a given amount at each price. The price in the market will decline the most if demand is more _____ and supply is more _____. A) price-elastic; price-elastic B) price-inelastic; price-elastic C) price-elastic; price-inelastic D) price-inelastic; price-inelastic Answer: DAnswer: B Answer: DAnswer: B Answer: D Answer: B The short-run
Microeconomics 4th Edition
448110
Exam Prep
ECON E 60072
A tax leads to a(n) _____ in consumer surplus and a(n) _____ in producer surplus. A) increase; increase B) increase; decrease C) decrease; increase D) decrease; decrease Answer: D Answer: D Answer: D Public goods are NOT sold in efficient quantities in the marketplace because: A) once supplied to a buyer, they can be made available at no
Microeconomics 4th Edition
449648
Exam Prep
ECON E 60354
An analytical approach through which strategic choices can be assessed is called: A) cost"benefit analysis. B) econometric theory. C) game theory. D) monopolistic competition. Answer: C Answer: C Answer: C The opportunity cost of an hour of leisure: A) is always assumed to be equal to the minimum wage. B) is the hourly wage rate. C) increases if the hour
Microeconomics 4th Edition
449583
Exam Prep
ECON E 61325
If a country has the comparative advantage in producing cloth, in the market for cloth the autarky price would be _____ the world price and the country would _____ cloth. A) less than; export B) greater than; export C) less than; import D) the same as; export Answer: A Answer: A Answer: A Scenario: The Market for
Microeconomics 4th Edition
448394
Exam Prep
ECON E 61458
Over the past several years, the demand for phone operators has fallen dramatically. Which of the following would account for this development? A) an increase in the number of automated answering services B) a decrease in the technology associated with phone equipment C) an increase in the supply of phone operators D) higher prices
Microeconomics 4th Edition
449837
Exam Prep
ECON E 62549
A leftward shift of a supply curve is caused by: A) an increase in the number of sellers. B) a technological improvement in production. C) an increase in the cost of an input. D) an increase in the number of buyers. Answer: C Answer: C Answer: C Eli has annual earnings of $100,000 and Molly has annual
Microeconomics 4th Edition
448877
Exam Prep
ECON E 80971
The demand for meals at a local Applebee's will shift to the left if: A) the Olive Garden offers a 10 percent discount coupon in the local newspaper. B) the price of a meal at Applebee's rises. C) local incomes increase and Applebee's is a normal good. D) the price of gasoline falls in
Microeconomics 4th Edition
449266
Exam Prep
ECON E 81330
If an insurance company insured 100,000 cars across the state against theft, which of the following would NOT be true? A) The insurance company would be fairly certain of the number of cars that will be stolen. B) The insurance company would be pooling risks. C) The insurance company would know with a
Microeconomics 4th Edition
448201
Exam Prep
ECON E 92378
A price ceiling will have NO effect if: A) it is set above the equilibrium price. B) the equilibrium price is above the price ceiling. C) it is set below the equilibrium price. D) it creates a shortage. Answer: A Answer: A Answer: A (Table: Workers and Corn Output) Look at the table Workers and Corn Output.
Microeconomics 4th Edition
448800
Exam Prep
ECON E 98436
(Table: Market for Fried Twinkies) Look at the table Market for Fried Twinkies. Suppose the government decides to reduce fried Twinkie consumption as part of a war on obesity. After careful study, the government decides to impose a quota of 5,000 on production of fried Twinkies this year. What price
Microeconomics 4th Edition
449041
Exam Prep
Economics 12900
Answer: B Answer: B Answer: B If a perfectly competitive firm is producing a quantity where P > MC, then the firm can increase profit by: A) making no change in output or price because it is already maximizing profit. B) increasing the price. C) decreasing the price. D) increasing production. Answer: D Answer: D Answer: D (Table: Employment and
Microeconomics 4th Edition
449012
Exam Prep
Economics 13656
The scaling of the axes of a time-series graph: A) is not a critical element in presenting the intended information. B) may change the interpretation of the data. C) generally places the time period on the vertical axis. D) generally puts values of a variable, such as the unemployment rate, on the vertical axis. Answer:
Microeconomics 4th Edition
448434
Exam Prep
Economics 14416
(Table: Production of Bagels) Look at the table Production of Bagels. Diminishing marginal returns begin with the addition of the _____ worker. A) third B) fourth C) fifth D) sixth Answer: BAnswer: Answer: BAnswer: Answer: B Answer: A A A Which of the following is most likely to have a vertical supply curve? A) salt B) oil C) insulin D) paintings by
Microeconomics 4th Edition
449602
Exam Prep
Economics 17619
Gas prices recently increased by 25%. In response, purchases of gasoline decreased by 5%. According to this finding, the price elasticity of demand for gas is: A) 5. B) 2. C) 0.2. D) 0.5. Answer: C Answer: C Answer: C Governments continue to impose price controls. Which of the following is NOT a valid reason for this? A)
Microeconomics 4th Edition
448276
Exam Prep
Economics 20312
Joe's budget line reflects the _____ available to Joe if he spends _____ of his income. A) consumption bundles; all B) consumption bundles; part C) utility; all D) utility; part Answer: A Answer: A Answer: A Figure: Supply of Coconuts (Figure: Supply of Coconuts) Look at the figure Supply of Coconuts. If the prices of inputs (e.g., labor,
Microeconomics 4th Edition
449596
Exam Prep
Economics 22408
Which of the following is NOT one of the four principles for understanding individual choice? A) Resources are scarce. B) Overall spending sometimes gets out of line with the economy's productive capacity. C) "How much" is a decision at the margin. D) People usually take advantage of opportunities to make themselves better off. Answer:
Microeconomics 4th Edition
449788
Exam Prep
Economics 25104
Which of the following is studied in macroeconomics? A) the change in automobile sales due to a change in the price of automobiles B) the effect of a tax reduction on the profits of an individual business C) recessions D) the unemployment of workers displaced by technological change in the typesetting industry Answer: C Answer:
Microeconomics 4th Edition
448631
Exam Prep
Economics 40575
_____ is a means-tested program. A) Expenditure on national defense B) Social Security payments to the disabled C) The food stamp program D) Purchasing a new city police car Answer: C Answer: C Answer: C (Table: Costs of Birthday Cakes) Look at the table Costs of Birthday Cakes. Assume that fixed costs are $10. The minimum average
Microeconomics 4th Edition
448898
Exam Prep
Economics 40677
Answer: B Answer: B Answer: B (Table: Total Cost and Output) Look at the table Total Cost and Output, which describes Sergei's total costs for his perfectly competitive all-natural ice cream firm. If the market price of a tub of ice cream is $35, how much is Sergei's profit at the optimal short-run output? A) "$5 B)
Microeconomics 4th Edition
448081
Exam Prep
Economics 41707
Answer: B Answer: B Answer: B Cindy operates Birds-R-Us, a small store manufacturing and selling 100 bird feeders per month. Cindy's monthly total fixed costs are $500, and her monthly total variable costs are $2,500. If for some reason Cindy's fixed cost fell to $400, then her _____ costs would _____. A) average fixed; increase B)
Microeconomics 4th Edition
449328
Exam Prep
Economics 47344
_____ tax is NOT used in the United States. A) Property B) Value-added C) Profits D) Sales Answer: B Answer: B Answer: B If a perfectly competitive firm sells 10 units of output at $30 per unit, its marginal revenue is: A) $10. B) $30. C) more than $30. D) $300. Answer: B Answer: B Answer: B If marginal costs remain constant, the marginal cost
Microeconomics 4th Edition
448645
Exam Prep
Economics 48583
Scenario: Alexander and Vanessa Alexander and Vanessa benefit from scientific research. Alexander's marginal private benefit from such research is given by the equation P = 200 " Q, where Q refers to the amount of research undertaken and P is the price Alexander is willing to pay for such research. Vanessa's
Microeconomics 4th Edition
448287
Exam Prep
Economics 49082
Which of the following is most likely to be observed when firms engage mainly in nonprice competition? A) actively encouraging the sale of generic as opposed to brand-name products B) advertising and product differentiation C) discounts offered through coupons D) low interest rates for financing the purchase of big-ticket items Answer: B Answer: B Answer: B _____
Microeconomics 4th Edition
449905
Exam Prep
Economics 50761
An artificially scarce good is a good or service for which exclusion is _____ and which is _____ in consumption. A) possible; rival B) possible; nonrival C) not possible; rival D) not possible; nonrival Answer: B Answer: B Answer: B (Table: Marginal Utility per Dollar of M&Ms) Look at the table Marginal Utility per Dollar of M&Ms.
Microeconomics 4th Edition
448742
Exam Prep
Economics 56560
(Table: Costs of Birthday Cakes) Look at the table Costs of Birthday Cakes. Assume that fixed costs are $10. What is the average variable cost of 4 cakes? A) $38.00 B) $10.00 C) $9.50 D) $8.00 Answer: C Answer: C Answer: C Figure: Profits in Monopolistic Competition (Figure: Profits in Monopolistic Competition) In panel (C) of the figure
Microeconomics 4th Edition
449702
Exam Prep
Economics 63373
Answer: A Answer: A Answer: A Scenario: Diversification Morris is considering investing $10,000 in a sunglass company or a rain poncho company. If it is a rainy year and he invests only in the sunglass company, he will lose $5,000. However, if it is a rainy year and he invests only in the rain
Microeconomics 4th Edition
449665
Exam Prep
Economics 65128
Firms will choose a tit-for-tat strategy if they: A) expect that price wars will ultimately provide benefits for the dominant firm. B) believe that the firms in the industry will be competing with each other for a long time. C) do not believe interdependence is a prominent characteristic of the industry. D) are sure
Microeconomics 4th Edition
448381
Exam Prep
Economics 65720
Many public utilities burn oil to generate electricity. If the price of oil increases, we expect a shift to the _____ in the _____ curve for _____ and a _____ price for electricity A) right; supply; electricity; lower B) left; supply; electricity; higher C) right; demand; oil; higher D) left; demand; oil; lower Answer:
Microeconomics 4th Edition
448186
Exam Prep
Economics 72612 Figure Cost
Figure: Cost Curves for Corn Producers (Figure: Cost Curves for Corn Producers) Look at the figure Cost Curves for Corn Producers. The market for corn is perfectly competitive. If the price of a bushel of corn is $4, in the short run the farmer will produce _____ bushels of corn and
Microeconomics 4th Edition
448253
Exam Prep
Economics 84906
(Table: The Cost of Producing Gadgets) Look at the table The Cost of Producing Gadgets. According to this table, the marginal cost is: A) increasing at a constant rate equal to $5. B) increasing at an increasing rate. C) increasing at a decreasing rate. D) constant and equal to $5. Answer: DAnswer: A Answer: DAnswer:
Microeconomics 4th Edition
448670
Exam Prep
Economics 86706
Figure: Three Firms That Pollute (Figure: Three Firms that Pollute) In the figure Three Firms That Pollute, at what tax rate would firm C produce zero tons of pollution? A) $400 B) $500 C) $700 D) $400, $500, or $700 Answer: D Answer: D Answer: D Which of the following factors would result solely in a movement along
Microeconomics 4th Edition
449491
Exam Prep
MicroEconomic 14248
If the government intervened in the market by lowering the price of a good below the equilibrium price, which of the following would NOT occur? A) Some consumers would receive an increase in consumer surplus. B) Producers would likely lose some producer surplus. C) The outcome would be efficient. D) Total surplus would be
Microeconomics 4th Edition
449617
Exam Prep
MicroEconomic 16333
In perfect competition, the firm produces the output such that _____, and in monopoly, the firm produces the output such that _____. A) P > MR = MC; P = MR = MC B) P = MR = MC; P < MR = MC C) P = MR = MC; P
Microeconomics 4th Edition
448943
Exam Prep
MicroEconomic 17698
(Table: Trade-off of Study Time and Leisure Time) Look at the table Trade-off of Study Time and Leisure Time. A student sleeps 8 hours per day and divides the remaining time between study time and leisure time. The table shows the combinations of study and leisure time that can
Microeconomics 4th Edition
448342
Exam Prep
MicroEconomic 19561
Table: Crop Income) Look at the table Crop Income. Brent is a farmer, and his income depends on the weather. A) Calculate Brent's expected income. B) Calculate Brent's expected utility. Answer: A) Expected income = 0.25 $0 + 0.5 $1,000 + 0.15 $2,000 + $0.10 $3,000 = $1,100B) Expected utility
Microeconomics 4th Edition
449807
Exam Prep
MicroEconomic 20016
(Table: Expected Exam Scores from Studying Economics and Accounting) Look at the table Expected Exam Scores from Studying Economics and Accounting. If you studied for a total of three hours and divided your time to maximize your combined scores, you would expect your combined scores to be _____ points. A) 145 B)
Microeconomics 4th Edition
448555
Exam Prep
MicroEconomic 20646
(Table: Cakes) Look at the table Cakes. Pat is opening a bakery to make and sell special birthday cakes. She is trying to decide how many mixers to purchase. Her estimated fixed and average variable costs if she purchases one, two, or three mixers are shown in the table. Assume that average
Microeconomics 4th Edition
449719
Exam Prep
MicroEconomic 22802
The point at which the axes of a graph intersect is called the: A) slope. B) origin. C) graph. D) intercept. Answer: B Answer: B Answer: B (Table: Cakes) Look at the table Cakes. Pat is opening a bakery to make and sell special birthday cakes. She is trying to decide how many mixers to purchase. Her estimated
Microeconomics 4th Edition
449529
Exam Prep
MicroEconomic 23469
(Table: Variable Costs for Lots) Look at the table Variable Costs for Lots. During the winter, Alexa runs a snow-clearing service in a perfectly competitive industry. Assume that costs are constant in each interval; that is, the variable cost of clearing anywhere from 1 through 10 lots is $200. Her
Microeconomics 4th Edition
449921
Exam Prep
MicroEconomic 25575
When firms price-discriminate, people with _____ price elasticity of demand will pay _____ prices relative to those purchasing the same product who have a _____ price elasticity of demand. A) higher; higher; lower B) lower; lower; higher C) lower; higher; higher D) higher; the same; lower Answer: C Answer: C Answer: C Figure: PPV (Figure: PPV) Look
Microeconomics 4th Edition
449337
Exam Prep
MicroEconomic 43055
In making an "either"or" decision: A) choose the activity that results in the greater economic profit. B) choose the activity that results in the greater accounting profit. C) continue in an activity as long as the marginal cost is greater than the marginal benefit. D) continue in an activity as long as the marginal
Microeconomics 4th Edition
448453
Exam Prep
MicroEconomic 44052
Figure: Short-Run Costs (Figure: Short-Run Costs) Look at the figure Short-Run Costs. A is the _____ cost curve. A) average total B) average variable C) marginal D) total Answer: C Answer: C Answer: C Answer: A Answer: A Answer: A Which of the following statements is FALSE? A) The income effect of normal goods counters the substitution effect, so the demand curve slopes
Microeconomics 4th Edition
448652
Exam Prep
MicroEconomic 47407
Redistribution programs are means-tested. To qualify for such a program, a person must demonstrate that: A) his or her family is larger than the mean family size for the country as a whole. B) his or her average (or mean) family income has fallen (or not gone up) during the past three years. C)
Microeconomics 4th Edition
448534
Exam Prep
MicroEconomic 52102
Advocates of trade barriers suggest that the barriers are needed for national security, job creation, and to: A) protect producers who are just starting out so that they can become more established. B) eliminate the need for governments to become involved in the trade discussions. C) enhance the comparative advantage nature of trade. D) increase
Microeconomics 4th Edition
448122
Exam Prep
MicroEconomic 54711
Answer: A Answer: A Answer: A If the market for buffalo meat is in equilibrium, the price of buffalo meat will probably _____ in the near future. A) increase B) not change C) decrease D) increase considerably Answer: B Answer: B Answer: B Answer: B Answer: B Answer: B Tankao makes Bluetooth sets for mobile devices. When 50 Bluetooth sets are produced in the
Microeconomics 4th Edition
449218
Exam Prep
MicroEconomic 58706
The government might impose a price ceiling if _____ can make a strong moral or political argument for _____ prices. A) demanders; lower B) suppliers; lower C) demanders; higher D) suppliers; higher Answer: A Answer: A Answer: A Total revenue will decrease if the price goes _____ and demand is _____. A) up; perfectly price-inelastic B) up; price-inelastic C) down;
Microeconomics 4th Edition
448989
Exam Prep
MicroEconomic 63359
Both monopolists and monopolistic competitors: A) make positive economic profits in the long run. B) have high barriers to entry. C) charge a price that is greater than the marginal cost of production. D) produce a product for which there are no substitutes. Answer: C Answer: C Answer: C Figure: Demand for DVDs (Figure: Demand for DVDs) Look
Microeconomics 4th Edition
449125
Exam Prep
MicroEconomic 66808
Figure: The Market for Melons in Russia (Figure: The Markets for Melons in Russia) Look at the figure The Market for Melons in Russia. Suppose the world price of melons is D. Russia will _____ of melons. A) import I " H B) export I " H C) import G " F D) export G
Microeconomics 4th Edition
448911
Exam Prep
MicroEconomic 76590
Figure: Possible Long-Run Outcome (Figure: Possible Long-Run Outcome) In the figure Possible Long-Run Outcome, which price and quantity refer to a potential long-run profit maximizing outcome for a firm producing in a monopolistically competitive market? A) P1 and Q3 B) P1 and Q1 C) P2 and Q2 D) P1 and Q4 Answer:
Microeconomics 4th Edition
448828
Exam Prep
MicroEconomic 76606
Steven consumes staples and paper clips. He is maximizing his utility in consumption of both goods. The price of staples rises. After the change in price Steven should consume _____ staples and _____ paper clips. A) more; fewer B) more; more C) fewer; more D) fewer; fewer Answer: C Answer: C Answer: C The price elasticity of
Microeconomics 4th Edition
449101
Exam Prep
MicroEconomic 77018
Figure: The Optimal Consumption Bundle (Figure: The Optimal Consumption Bundle) Look at the figure The Optimal Consumption Bundle. Which of the following could lead to an optimal consumption bundle on indifference curve I1? A) an increase in income B) a decrease in the price of restaurant meals C) a decrease in the price of
Microeconomics 4th Edition
448571
Exam Prep
MicroEconomic 79124
A perfectly competitive firm maximizes profit in the short run by producing the quantity at which: A) TR = TC. B) MR = MC. C) Q (P " ATC) = 0. D) P < AVC. Answer: BAnswer: B Answer: BAnswer: B Answer: B Answer: B Both the United States and Canada produce automobiles and their
Microeconomics 4th Edition
448354
Exam Prep
MicroEconomic 80074
Figure: A Market in Equilibrium (Figure: A Market in Equilibrium) Look at the figure A Market in Equilibrium. At the equilibrium price, this market's producer surplus is equal to the area: A) ADI. B) EHF. C) AIF. D) DIF. Answer: D Answer: D Answer: D A fair insurance policy is one whose premium: A) is zero. B) allows the
Microeconomics 4th Edition
448095
Exam Prep
MicroEconomic 80878
The price elasticity of demand for fresh tomatoes has been estimated to be 2.22. If a new insecticide and fertilizer treatment yields a 20% increase in the nation's fresh tomato crop, how will that affect total revenue from fresh tomatoes, all other things unchanged? A) Total revenue will remain unchanged. B) Total
Microeconomics 4th Edition
448973
Exam Prep
MicroEconomic 81216
Answer: B Answer: B Answer: B After learning about indifference curves, Sandy realizes that her marginal rate of substitution of grapes for cheese is 2. Since the price of cheese is $3 and the price of grapes is $1, Sandy: A) should buy more grapes and less cheese. B) should buy more cheese and fewer
Microeconomics 4th Edition
449175
Exam Prep
MicroEconomic 83161
If a good is a necessity with few substitutes, then demand will tend to: A) be more price-elastic. B) be more price-inelastic. C) have price elasticity equal to 1. D) be the same as that of a luxury good. Answer: B Answer: B Answer: B Figure: The Production Possibilities for Two Countries (Figure: The Production Possibilities for Two
Microeconomics 4th Edition
448837
Exam Prep
MicroEconomic 83220
To minimize deadweight loss, markets where demand is relatively _____ and supply is relatively _____ should be taxed. A) elastic; inelastic B) elastic; elastic C) inelastic; elastic D) inelastic; inelastic Answer: D Answer: D Answer: D Figure: Shifts in Demand and Supply II (Figure: Shifts in Demand and Supply II) Look at the figure Shifts in Demand and
Microeconomics 4th Edition
449023
Exam Prep
MicroEconomic 94574
Which of the following is an example of an artificially scarce good? A) diamonds, because their supply is artificially restricted by monopoly producers B) music that is downloadable from the Internet for a fee C) a daily newspaper D) hot dogs in a sports stadium, because the number of suppliers is restricted Answer: B Answer:
Microeconomics 4th Edition
448862
Exam Prep
MicroEconomic 99923
A small public park in a large town with many other parks often has very few visitors because of its size. There is no fee to enter the park, but few people visit it, since other parks have more amenities. This park is _____ in consumption and _____. A) rival; excludable B)
Microeconomics 4th Edition

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