Figure 12-4 Figure 12-4 shows the cost
and demand curves for a profit-maximizing firm in a perfectly competitive market. If
the market price is $30 and the firm is producing output, what is the amount of the
firm’s profit or loss?
A) loss of $1,080
B) profit of $1,440
C) loss of $2,520
D) profit of $1,300
Table 2-18
Table 2-18 shows the output per week of two people, Minnie and Mickey. They can
either devote their time to making hats or making umbrellas. Which of the following
statements istrue?
A) Minnie has a comparative advantage in making both products.
B) Mickey has a comparative advantage in making both products.
C) Minnie has a comparative advantage in making hats and Mickey in making
umbrellas.
D) Mickey has a comparative advantage in making hats and Minnie in making
umbrellas.
A firm could continue to operate for years without ever earning a profit as long as it is
producing an output where
A) MR < ATC.
B) ATC > AVC.
C) MR > AVC.
D) AFC < AVC.
The price of a financial asset should be equal to
A) the face value of the asset.
B) the present value of the sum of the coupon payments and the interest rate.
C) the face value of the asset divided by the interest rate.
D) the present value of payments to be received from owning that asset.
A general formula for the multiplier is
A) .
B) .
C) .
D) .
Table 2-12
Table 2-12 shows the number of labor hours required to produce a canoe and a sailboat
in Guatemala and Honduras.
Guatemala has a comparative advantage in the production of
A) canoes.
B) sailboats.
C) both products.
D) neither product.
Which of the following is not an example of a monopolistically competitive market?
A) automobile producers
B) supermarkets
C) video stores
D) makers of women’s clothing
An example of a factor of production is
A) a car produced by an auto manufacturer.
B) a worker hired by an auto manufacturer.
C) a loan granted to an auto manufacturer.
D) the automobiles exported by an auto manufacturer.
Figure 11-13
The lines shown in the diagram are isocost lines. Which of the following shows an
increase in the price of labor while the price of capital remains unchanged?
A) the movement from AF to BD
B) the movement from AF to CE
C) the movement from BF to BD
D) the movement from BF to CE
Table 2-25
This table shows the number of labor hours required to produce a motorcycle and a
guitar in Ireland and Scotland. a. Which country has an absolute advantage in the
production of motorcycles?
b. Which country has an absolute advantage in the production of guitars?
c. What is Ireland’s opportunity cost of producing one motorcycle?
d. What is Scotland’s opportunity cost of producing one motorcycle?
e. What is Ireland’s opportunity cost of producing one guitar?
f. What is Scotland’s opportunity cost of producing one guitar?
g. If each country specializes in the production of the product in which it has a
comparative advantage, who should produce motorcycles?
h. If each country specializes in the production of the product in which it has a
comparative advantage, who should produce guitars?
In an attempt to bring lenders and borrowers together following the financial crisis of
2008, the Federal Reserve made a large amount of new funds available to financial
markets. Any of these new funds that are loaned out by banks would be classified as
________ of the banks.
A) required reserves
B) excess reserves
C) deposits
D) liabilities
Figure 7-1 Figure 7-1 represents the
market for vaccinations. Vaccinations are considered a benefit to society, and the figure
shows both the marginal private benefit and the marginal social benefit from
vaccinations.
The efficient equilibrium quantity is ________ thousand vaccinations.
A) 100
B) 200
C) 300
D) >300
Matt’s real wage in 2014 is $26.80. If the price level is 104, what is Matt’s nominal
wage?
A) $30.80
B) $27.87
C) $26.80
D) $25.77
Which of the following describes two-part tariff pricing?
A) A firm charges two different prices for the same good.
B) An importer has to pay a tax at the nation’s borders, and a sales tax when the good is
sold.
C) A buyer pays an initial price for entrance to the market and an additional fee for each
unit of the product purchased.
D) A buyer must pay a down payment and monthly payments to buy big-ticket items
such as a car, a plasma television or a suite of furniture.
Table 18-5
Table 18-5 shows the amount of taxes paid on various levels of income.
The tax system is
A) progressive throughout all levels of income.
B) proportional throughout all levels of income.
C) regressive throughout all levels of income.
D) regressive between $20,000 and $25,000 of income and progressive between
$32,000 and $42,000.
Figure 4-1 Figure 4-1 shows Arnold’s demand curve for
burritos.
If the market price is $2.00, what is Arnold’s consumer surplus?
A) $0.50
B) $1.00
C) $1.50
D) $3.00
Since the Social Security system began in 1935, the number of workers per retiree has
A) stayed roughly the same.
B) continually risen.
C) continually declined.
D) risen and declined with different generations.