As the marginal physical product of U.S. workers _________________, the marginal
cost of goods produced in the U.S. ______________ and unit costs
_____________.This makes American goods ________________ competitive in the
global marketplace.
a. rises; falls; fall; less
b. falls; falls; fall; more
c. rises; falls; fall; more
d. rises; falls; fall; more
Situation 22-2
Alejandro is one of the leading widget producers in the country. At his current level of
production, his total costs amount to $5,000, total fixed costs are $2,000, and average
total costs are $250.
What is Alejandro’s marginal cost at the present level of production?
a. $60
b. $80
c. $100
d. $200
e. There is not enough information to answer the question.
If implicit costs equal accounting profit, economic profit must be
a. negative.
b. positive.
c. zero.
d. higher in the short run than in the long run.
e. higher in the long run than in the short run.
Consider two options: (A) you receive a guaranteed payment of $100; (B) a coin is
tossed and if heads comes up, you win nothing; if tails comes up, you win $200. The
expected payoff for option A is:
a. $200
b. $100
c. $300
d. $75
e. There is not enough information to answer the question.
Some people see the government as being more heavily involved in taking sides than in
serving the common interest.
a. True
b. False
Price elasticity of supply is the percentage change in the quantity __________ of a good
divided by the percentage change in __________.
a. demanded; the price of the good
b. supplied; the price of the good
c. demanded; the price of another good
d. supplied; the price of another good
e. demanded; income
The Gini coefficient measures the degree of
a. racial discrimination.
b. age discrimination.
c. income inequality.
d. sex discrimination.
e. wage discrimination.
“Exclusive dealing” refers to
a. charging one customer a higher price than another customer for the same good.
b. the condition that is necessary before a conglomerate merger is likely to be
successful.
c. a provision of the Sherman Act.
d. selling to a retailer on the condition that the retailer not carry any rival products.
e. none of the above
Exhibit 28-5
In case (1), with a rise in the wage rate from W1 to W2, the wage bill will fall if
a. (Q1 – Q2) x W1 > (W2 – W1) x Q2.
b. (Q3 – Q2) x W3 > (W2 – W3) x Q2.
c. W2 x Q2 > Q3 x W1.
d. (W1 – W3) x Q2 > (W2 – W1) x Q2.
Exhibit 2-7
For which of the following is the statement €In order to get more military goods, we
have to forfeit some civilian goods€ true?
a. a movement from A to C
b. a movement from B to D
c. a movement from F to D
d. a movement from B to A
e. none of the above
People such as Henry Ford and Thomas Edison most likely earned profit as a result of
“innovative genius.”
a. True
b. False
__________ is the number of units that individuals are __________ to buy at a
particular price during some time period.
a. Demand; willing and able
b. Supply; willing and able
c. Quantity demanded; willing and able
d. Demand; able
e. Quantity demanded; willing
One way to calculate marginal revenue product is
a. MR x MPP.
b. MPP/MR.
c. MR + MPP.
d. MPP – MR.
e. none of the above
The term after the bell means after the closing of the stock market.
a. True
b. False
Interest can be regarded as the
a. payment to entrepreneurs for incurring risk in the production of new goods.
b. rate that a lender receives for the use of the lender’s loanable funds.
c. return earned by capital as an input in the production process.
d. dollar amount of loanable funds that a person borrows to invest in a capital good.
Exhibit 30-4
Assume a per acre tax, T, is imposed on land use. The rent (per acre) of land services
will
a. rise from R1 to R1 + T.
b. fall from R1 to R1 – T.
c. remain unchanged at R1.
d. fall to 0.
In maximizing profits, a single-price monopolist will charge a price that is
a. less than marginal cost.
b. equal to marginal cost.
c. greater than marginal cost.
d. There is not enough information to answer the question.
A winner-take-all market
a. is one in which the top producer or performer in the market earns significantly more
than others in the same market.
b. applies to the sports market and the entertainment market, exclusively.
c. the top producer earns all of the profits in that market.
d. a and b
e. b and c
Exhibit 28-5
In which of the following cases has the increase in the wage from W1 to W2 been
brought about by a prolonged successful training program undertaken by the union for
the benefit of its members?
a. (1)
b. (2)
c. (3)
d. none of the above
“Managerial coordination” refers to the
a. behavior of a worker who is putting forth less than the agreed-to effort.
b. process whereby individuals perform certain tasks based on changes in market
forces.
c. process whereby persons share in the profits of a business firm.
d. process whereby managers direct employees to perform certain tasks.