1) The argument that a large firm dominating an industry will not necessarily act like a
monopolist, as expressed in the 1920 U.S. Steel case, suggests that the application of
antitrust laws should be based on firm:
A.Behavior
B.Structure
C.Efficiency
D.Concentration ratios
2) The judging of an individual on the basis of the average characteristics of the group
to which the individual belongs rather than the individual’s characteristics is:
A.Statistical discrimination
B.Reverse discrimination
C.Human capital discrimination
D.Wage discrimination
3) Which of the following is necessary to make a trade in a barter economy?
A.Money
B.Unlimited wants
C.A medium of exchange
D.A coincidence of wants
4) In the below circular flow diagram, the household and business sectors are labeled
with arrows representing the flows of income and output labeled (a) through (f) and the
two appropriate markets labeled (g) and (h). Supply the correct descriptive titles for
each of these labels (a) through (h).
5) Suppose the Herfindahl indexes for industries A, B, and C are 1,200, 5,000, and
7,500 respectively. These data imply that:
A.market power is greatest in industry A
B.market power is greatest in industry B
C.market power is greatest in industry C
D.industry A is more monopolistic than industry C
6)
Refer to the diagrams for two separate product markets. Assume that society’s optimal
level of output in each market is Q0 and that government purposely shifts the market
supply curve from S to S1 in diagram (a) on the left and from S to S2 in diagram (b) on
the right. The shift of the supply curve from S to S2 in diagram (b) might be caused by
a per-unit:
A.subsidy paid to the producers of this product.
B.tax on the producers of this product.
C.subsidy paid to the buyers of this product.
D.tax on the buyers of this product.
7) The World Trade Organization:
A.is also known as the International Monetary Fund (IMF).
B.is also known as NAFTA.
C.was established to resolve disputes arising under world trade rules.
D.enhances world trade by providing interest rate subsidies to foreign borrowers who
buy exports on credit.
8)
The outflow of highly-educated workers from low-income countries to high-income
countries is called:
A.Backflow
B.Self-selection
C.Skill transferability
D.Brain drain
9) The ABC Corporation decreases all of its inputs by 12 percent and finds that its
output falls by only 8 percent. This means that initially it was producing:
A.in the range of diseconomies of scale.
B.in the range of economies of scale.
C.where AP is less than MP.
D.at the point of minimum efficient scale.
10) International specialization and trade:
A.Has to be done on a barter system
B.Often requires the exchange of currencies
C.Does not illustrate the division of labor
D.Requires active government regulation
11) The main focus of the Patient Protection and Affordable Care Act (PPACA) is the
provision of health insurance coverage to all Americans.