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1) Interindustry competition means that:
A.in oligopolistic industries a few large firms compete with one another in bidding
down product price.
B.in some markets the producers of a particular product might face competition from
products produced by other industries.
C.firms that sell a product at one stage of production are faced with firms that buy the
product at the next stage of production.
D.in most industries there are usually a number of firms producing identical products.
2) The wide imitation and spread of an innovation is called:
A.innovation.
B.invention.
C.creative destruction.
D.diffusion.
3)
Refer to the table above for a certain product's market in Econland. If the world price
for this product were $6, then Econland would import:
A.400 units and domestic producers would supply 1,400
B.800 units and domestic producers would supply 1,400
C.800 units and domestic producers would supply 2,200
D.400 units and domestic producers would supply 2,200
4)
Refer to the diagram. The short-run supply curve for this firm is the:
A.entire MC curve.
B.segment of the AVC curve lying to the right of the MC curve.
C.segment of the MC curve lying to the right of output level k.
D.segment of the MC curve lying to the right of output level h.
5) The percentage of cost that an insured individual pays while the insurer pays the
remainder would be considered:
A.Copayments
B.Deductibles
C.Play-or-pay
D.Fee for service
6) Answer the question on the basis of the following supply information facing a single
firm in a particular labor market:
Refer to the given information. The marginal resource (labor) cost of the third worker
is:
A.$15.
B.$25.
C.$35.
D.$45.
7) Mutual interdependence means that each oligopolistic firm:
A.faces a perfectly elastic demand for its product.
B.must consider the reactions of its rivals when it determines its price policy.
C.produces a product identical to those of its rivals.
D.produces a product similar but not identical to the products of its rivals.
8)
Refer to the diagram for a purely competitive producer. The firm's short-run supply
curve is:
A.the abcd segment and above on the MC curve.
B.the bcd segment and above on the MC curve.
C.the cd segment and above on the MC curve.
D.not shown.
9) Real wages in the United States in the long run:
A.show no discernible relationship to output per worker.
B.have increased at about the same rate as increases in output per worker.
C.have increased slower than increases in output per worker.
D.have increased faster than increases in output per worker.
10) Which of the following is not an example of pricing based on group differences in
elasticity of demand?
A.Senior-citizen discounts at restaurants and motels.
B.Cash rebates for purchases of automobiles.
C.Child discounts for admission to theme parks.
D.Discounted student prices for visits to museums.
11) Use the resource demand data shown on the left and the resource supply data on the
right in answering the following question:
Refer to the given data. How many units of output will this profit-maximizing firm
produce?
A.39
B.48
C.55
D.60
12)
Refer to the given data. This firm's product price is:
A.$2.
B.$3.
C.$4.
D.$16.
13) Power plants with the lowest operating costs tend to:
A.have the lowest fixed costs in terms of construction.
B.have the highest fixed costs in terms of construction.
C.operate on the smallest scale of energy production.
D.generate the cleanest energy.
14) The modern view of technological advance is that it:
A.is rooted in the independent advance of science, an element largely external to the
market system.
B.is rarely carried out by oligopolists or pure monopolists.
C.is an internal element of capitalism, occurring in responses to profit incentives.
D.necessarily destroys existing monopoly power.
15) Given the short-run instability of farm incomes, many farmers use some form of
"hedging" to smooth out their incomes over time, including the following except:
A.Crop revenue insurance
B.Futures markets
C.Contracting with processors
D.Forming a cartel to fix prices
16) Answer the question on the basis of the following cost data for a firm that is selling
in a purely competitive market:
Refer to the data. Which of the following is the firm's short-run supply schedule?
A.
B.
C.
D.
