1) If the wage rate in a purely competitive labor market increases, it will cause the:
A.Marginal resource cost curve for a single competitive firm in the industry to shift
down
B.Marginal resource cost curve for a single competitive firm in the industry to shift up
C.Labor supply curve for a single competitive firm to shift downward
D.Labor supply curve for the industry to shift rightward
2) Assume that there is a supply and demand market for non-preferred workers. If
prejudice against these workers among employers increases, then there will be a(n):
A.Increased supply of these workers, a rise in their wage rate, and a decrease in their
employment
B.Increased demand for these workers, a rise in their wage rate, and an increase in their
employment
C.Decreased supply of these workers, a fall in their wage rate, and a decrease in their
employment
D.Decreased demand for these workers, a fall in their wage rate, and a decrease in their
employment
3) Tennis rackets and ballpoint pens are:
A.substitute goods.
B.complementary goods.
C.inferior goods.
D.independent goods.
4) In which of the following market models do demand and marginal revenue diverge?
A.Pure monopoly, oligopoly, and monopolistic competition.
B.Pure monopoly, oligopoly, and pure competition.
C.Pure monopoly only.
D.Oligopoly only.
5) Which of the following statements is most accurate about the effects of migration?
A.Migration generally benefits the mover, but there is a net efficiency loss to the world.
B.Migration generally benefits everyone in both the origin and destination nations.
C.Migration generally benefits the mover and creates a net efficiency gain for the
world.
D.Remittances cause the gains from immigration to be distributed unevenly.
6) The following table applies to a purely competitive industry composed of 100
identical firms.
Refer to the table. For each of the 100 firms in this industry, marginal revenue and total
revenue will be:
A.$4 and $400, respectively.
B.$3 and $30,000, respectively.
C.$4 and $20,000, respectively.
D.$3 and $18,000, respectively.
7) The expected-rate-of-return curve for R&D expenditures of a firm slopes downward
because of:
A.Diminishing marginal returns from R&D activities
B.Economies of scale in R&D projects
C.Average fixed costs of R&D projects
D.The law of supply for R&D expenditures
8)
Refer to the market for loanable funds, as shown in the above graph. Suppose the
market for loanable funds is originally in equilibrium at interest rate i0 and quantity Q0.
In the next period, the equilibrium interest rate increases to i1 and quantity decreases to
Q1. Which of the following could be the cause of this shift?
A.Households decide to save less
B.Households decide to save more
C.Investors become less optimistic
D.Investors become more optimistic
9) The slope of a budget line reflects the:
A.desirability of the two products.
B.price ratio of the two products.
C.amount of the consumer’s income.
D.utility ratio of the two products.
10)
Refer to the graph above. Suppose that its shows the S and D graphs in a market where
production entails a significant amount of pollution. In this case, the government should
use its coercive power to make:
A.The supply curve shift to the left
B.The supply curve shift to the right
C.The demand curve shift to the left
D.The demand curve shift to the right
11)
The MB curves in the diagram slope downward because of the law of:
A.conservation of matter and energy.
B.diminishing returns.
C.diminishing marginal utility.
D.increasing cost.
12) Which of the following defines marginal utility?
A.The change in total utility divided by the price of a product
B.The maximum amount of satisfaction from consuming a product
C.The total satisfaction derived from a certain amount of the product
D.The additional satisfaction from consuming one more unit of a product
13) When a state government chooses to build more roads, the resources used are no
longer available for public education programs. This dilemma illustrates the concept of:
A.Production expenses
B.Unemployment issues
C.Unintended consequences
D.Opportunity cost
14) For a monopolist to sell an output level of 10 units, the price must be $8. MR at this
output level will be:
A.> $8 and < $16
B.< $8
C.= $8
D.> $16
15)
Refer to the above table. At a price of $15 per unit, which of the following would exist?
A.A shortage of 1,600 units
B.A surplus of 1,000 units
C.A shortage of 1,000 units
D.A surplus of 600 units
16) The market system communicates changes in market conditions and elicits
appropriate responses from businesses and resource suppliers through changes in prices.
This is known as the:
A.Guiding function of prices
B.Monetary function of prices
C.Circular flow of income
D.Market determination of prices