Looking at the record of concentration in the United States during the last century, one
finds concentration has
a. steadily increased.
b. risen dramatically in the past 15 years.
c. changed very little.
d. fallen steadily except in wartime.
Productivity growth rates are usually higher in rich countries than in poor countries.
a. True
b. False
A small increase in productivity growth can have a huge impact on a country’s standard
of living.
a. True
b. False
Elasticity provides a guide to both
a. market stability and change in revenue as price changes.
b. responsiveness of quantity demanded to a change in price and market stability.
c. responsiveness of quantity demanded to a change in price and change in revenue as
price changes.
d. technological change and change in revenue as price changes.
In the case study in the text involving calculator production, the fact that each calculator
produced added $10.30 to cost and $12 to revenue made clear the value of ____ in
determining whether or not to suspend production.
a. average fixed cost
b. cost saving
c. marginal analysis
d. the level of fixed cost
Corrected for inflation, the real GDP was only about _____ times greater in 2014 than
in 1959.
a. 3.1
b. 5.3
c. 6.7
d. 11.2
Rent seeking refers to unproductive activity in the pursuit of profit.
a. True
b. False
Falling below a minimum standard of living illustrates the concept of absolute poverty.
a. True
b. False
In which of the following examples is excess burden not present?
a. Harriet decides to give up her Saturday hours at her law office after income tax rates
rise.
b. Rudolf still smokes three packs a day even after the excise tax on cigarettes rose 10
cents a pack.
c. Wilma reduced the automatic payroll deduction to her savings account after the tax
on interest was imposed.
d. Harper decided to take a vacation in Bermuda rather than invest in stocks after the
tax rate on capital gains was increased.
If the price level increases, we would expect consumers to
a. raise their consumption functions.
b. move downward along their consumption functions.
c. lower their consumption functions.
d. move upward along their consumption functions.
Which of the following best reflects the ability-to-pay philosophy of taxation?
a. an excise tax on coffee
b. an excise tax on gasoline
c. a progressive income tax
d. a tax on residential property
Figure 5-6
In Figure 5-6, a shift in the budget line from AC to AB indicates
a. the price of wine coolers has risen.
b. income has increased.
c. the price of beer has fallen.
d. the price of wine coolers has fallen.
e. All of the above are correct.
If a currency depreciates, a country’s net exports
a. fall and AD increases.
b. rise and AD increases.
c. fall and AD decreases.
d. rise and AD decreases.
Figure 14-1
In Figure 14-1, a technological breakdown in calculator production would cause which
movement?
a. B to E
b. B to C
c. B to D
d. A to D
There is a positive relationship between the quantity of reserves supplied and the
federal funds rate.
a. True
b. False
If the economy is in an inflationary gap, and the government attempts to balance the
budget, the effect will be to
a. counteract inflation.
b. reduce the trade deficit.
c. continue inflationary pressures.
d. increase unemployment.
If personal income taxes are increased, disposable income and consumption
a. increase.
b. stay the same.
c. decrease.
d. change in an unpredictable direction.
Deficit is to debt as
a. responsible is to irresponsible.
b. increase is to decrease.
c. flow is to stock.
d. important is to unimportant.
The reason why cleanup costs are lower for a taxes approach than for a direct controls
approach is that
a. all firms reduce pollution equally and fairly.
b. firms that are able to clean up at lowest cost do so; others don’t.
c. large polluters clean up the most, which is always lowest cost.
d. small polluters clean up the most, which is generally the cheapest.
Figure 20-6
In Figure 20-6, an expansive fiscal policy in a closed economy results in an equilibrium
at point E. In an open economy, allowing for the effects of the induced change in the
currency value, the final equilibrium would be point
a. B.
b. F.
c. J.
d. H.
Table 11-2
In Table 11-2, average cost at the profit-maximizing output is how much?
a. $5
b. $8
c. $10
d. $11
A perfectly competitive firm and a monopolistically competitive firm are similar in
each of the following respects except
a. each has many buyers and sellers.
b. firms sell homogeneous products in both markets.
c. in having perfect information.
d. for freedom of exit and entry.
From 1975 to 2008, which of the following countries experienced greater wage
increases than the U.S.?
a. Japan
b. South Korea
c. Taiwan
d. all of the above
A supply curve slopes upward because quantity supplied is higher when price is higher.
a. True
b. False
If inflationary expectations are quite sluggish (that is, they do not adapt quickly), then
the short-run Phillips curve will
a. be vertical.
b. be horizontal.
c. slope downward.
d. slope upward.
Suppose the numbers in parentheses represent two points on a line: (59 billion quarts;
$4) and (78 billion quarts; $6). The line is most likely a
a. production possibilities frontier for milk.
b. supply curve for milk.
c. demand curve for milk.
d. ray through the origin.
e. time series line.
Workforce quality arguments are very difficult to prove for the period of 1970 to 1990
because during that period SAT scores
a. and graduation rates increased.
b. increased and graduation rates decreased.
c. and school attendance rates decreased.
d. decreased and school attendance rates increased.
As more firms are attracted to an industry, the supply curve can be expected to shift to
the right.
a. True
b. False
Figure 17-4
Which panel in Figure 17-4 shows the movement associated with the supply-side
changes of the 1990s?
a. 1
b. 2
c. 3
d. 4
A country’s comparative advantage can be illustrated by the graph of the production
possibilities frontier.
a. True
b. False