1) specialization may expand total output even though the individuals involved may
have identical abilities.
2) the process by which capital goods are accumulated is known as investment.
3) unemployment compensation payments are an example of a transfer payment.
4) unanticipated inflation benefits debtors at the expense of creditors.
5) Sales taxes are proportional in relation to income because the same tax rate applies
regardless of the size of a purchase.
6) According to monetarists, discretionary monetary policy has been a major source of
economic instability.
7) The top 20 percent of U.S. income earners receive nearly 80 percent of total U.S.
income.
8) The standard data on income distribution do not include the value of noncash
transfers as income.
9) In the absence of enforceable property rights, there is little incentive to preserve
resources for future use.
10) Labor market discrimination increases the size of the nation’s GDP.
11) price discrimination is illegal in the united states under antitrust regulations.
12) The labor supply curve facing a purely competitive firm is perfectly inelastic.
13) Large, well-established firms are more likely to use retained earnings to finance
R&D, while small start-up firms are more likely to rely on venture capital.
14) if a market is competitive, the resulting equilibrium output will always be the
socially efficient output.
15) The shape of the aggregate supply curve is determined by what happens to
aggregate demand as real output expands.
16) a shift to the right in the demand curve for product a can be most reasonably
explained by saying that:
a.consumer incomes have declined and they now want to buy less of a at each possible
price.
b.the price of a has increased and, as a result, consumers want to purchase less of it.
c.consumer preferences have changed in favor of a so that they now want to buy more
at each possible price.
d.the price of a has declined and, as a result, consumers want to purchase more of it.
17)
refer to the above graph. which of the following statements is correct?
a.quantity demanded and quantity supplied are independent of price.
b.price and quantity demanded are directly related.
c.price and quantity supplied are directly related.
d.price and quantity supplied are inversely related.
18)
refer to the above diagram. the slope of curve zz at point a is approximately:
a.+2.
b.+21/2.
c.-21/2.
d.+4.
19) The following table shows the marginal benefit a particular public project will
provide to each of the three members of a community. No vote trading is allowed.
If the tax cost of this proposed project is $600 per person, a majority vote will:
A.defeat this project and resources will be underallocated to it.
B.pass this project and resources will be allocated efficiently.
C.pass this project and resources will be overallocated to it.
D.pass this project and resources will be underallocated to it.
20) which of the following statements is true about the effects of illegal immigration in
the united states?
a.illegal immigrant workers displace domestic-born workers on a one-for-one basis.
b.illegal immigration has a negative fiscal impact that falls most heavily on state and
local governments.
c.illegal immigration negatively impacts wages and the standard of living for all
domestic-born workers.
d.all of these are true.
21) The economy’s long-run aggregate supply curve:
A.slopes upward and to the right.
B.is vertical.
C.is horizontal.
D.slopes downward and to the right.
22) brinley says that “gas prices are rising because there aren’t enough oil refineries.”
katie argues that “gas prices are rising because of the growing demand for gasoline
from china and india.” we can conclude that:
a.brinley’s statement is positive; katie’s statement is normative.
b.brinley’s statement is normative; katie’s statement is positive.
c.both statements are positive.
d.both statements are normative.
23)
refer to the above production possibilities curve. at the onset of the second world war
the soviet union was already at full employment. its economic adjustment from
peacetime to wartime can best be described by the movement from point:
a.c to point b.
b.b to point c.
c.a to point b.
d.c to point d.
24) Banks destroy money when they:
A.buy government bonds.
B.accept deposits of cash into checkable accounts.
C.fail to reissue loans that are paid off.
D.clear checks against another bank.
25) Which of the following best reflects the ability-to-pay philosophy of taxation?
A.a tax on residential property
B.a progressive income tax
C.an excise tax on gasoline
D.an excise tax on coffee
26) What are three major human resource problems in developing nations?
27) The magnitude and nature of the problems faced by the developing countries gives
socialism or communism an inside track over capitalism as a model for development.
Evaluate.
28) How can paying workers an above-market wage result in greater efficiency? What
are the implications for the flexibility of wages?
29) What is the relationship between Social Security and the budget?
30) What are demand shocks? Give an example of a positive and a negative demand
shock.
31) What is the difference between social insurance and public assistance in income
maintenance programs? What are examples of each type of government program?
32) The table below contains the international balance-of-payments data for the United
States in a past year. All figures are in billions. Compute with the appropriate sign (+
or ) and enter in the table the six missing items. What was the condition of the balance
of payments in the United States?
33) How does monopoly result in income transfers?
34) Discuss the issue of climate change. Define the problem, explain the proposed
solutions, and describe the views of economists on the issue.
35) What have been the trends in income inequality since 1970?