Figure 12-6
Figure 12-6 shows the demand,
marginal cost (MC) and average total cost (ATC) curves for Jason’s House of Apples. To
maximize his profit, Jason should produce the rate of output indicated by point
A) a.
B) b.
C) e.
D) d.
Which of the following would increase gross private domestic investment in an
economy?
A) an increase in the shares of Apple stock households own
B) an increase in the number of workers Apple hires
C) an increase in the level of Apple’s inventory
D) an increase in the number of highway construction projects the government is
funding
An oligopolistic industry is characterized by all of the following except
A) existence of entry barriers.
B) the possibility of reaping long-run economic profits.
C) firms pursuing aggressive business strategies, independent of rivals’ strategies.
D) production of standardized products.
Table 17-3
Hotspur Incorporated, a manufacturer of microwave ovens, is a price taker in its input
and output markets. The firm hires labor at a constant wage rate of $800 per week and
sells microwave ovens at a constant price of $80. Table 17-3 shows the relationship
between the quantity of labor it hires and the quantity of microwave ovens it produces.
What is the amount of revenue added as a result of hiring the fourth worker?
A) $1,200
B) $7,200
C) 15 microwaves
D) 90 microwaves
Congress passed the ________ in 1996, the purpose of which was to phase out price
floors and return to a free market in agriculture
A) Rice and Beans Act
B) Smoot-Hawley Act
C) Agribusiness Act
D) Freedom to Farm Act
The demand for loanable funds is determined by the willingness of ________ to borrow
money to engage in new investment projects.
A) government
B) households
C) banks
D) firms
Although the Federal Reserve had traditionally made discount loans only to ________,
in response to the financial crisis in 2008 the Fed made primary dealers eligible for
discount loans as well.
A) commercial banks
B) government agencies
C) investment banks
D) mortgage lenders
Table 13-3
Table 13-3 shows the demand and cost schedules for a monopolistically competitive
firm.
What is the amount of the firm’s loss at its optimal output level?
A) $0
B) $41
C) $45
D) $50
Which of the following is not a barrier to entry?
A) an inelastic demand curve
B) economies of scale
C) ownership of a key input
D) a patent
The Congressional Budget Office estimates that ________ of the increase in federal
spending on Medicare and Medicaid over the next 75 years will be due to increases in
the cost of providing health care.
A) very little
B) less than half
C) most
D) all
Which of the following statements is true about a simple circular flow model?
A) Producers are neither buyers nor sellers in the product market.
B) Households are neither buyers nor sellers in the input market.
C) Producers are buyers in the factors market.
D) Households are sellers in the product market.