The marginal revenue of a monopolistically competitive firm
A) cannot be negative because the price the firm charges will always be greater than
zero.
B) can be negative if the firm charges a high price.
C) can be negative if the firm charges a low price.
D) will equal average revenue.
Which of the following is a macroeconomics question?
A) What determines the minimum wage?
B) What determines the production of video game consoles?
C) What factors determine the price of Oreo cookies?
D) What determines the salaries of college professors?
Article Summary. Roberto Azevedo, director-general of the World Trade
Organization (WTO), reported that global trade growth estimates will be lowered
for 2013 and 2014 because of increasing global protectionism. The current
protectionism is based primarily in regulations rather than the more common
tariffs and subsidies. Since 2008, almost 700 new trade restrictions have
materialized – over 150 of those in 2012 alone – with Russia being singled out as
one of the primary offenders. Source: Kiran Moodley, “WTO warns of trade
slowdown due to protectionism,” CNBC, September 6, 2013.
The protectionism being granted to Russian firms is likely to cause
A) exporting countries to retaliate by placing trade barriers on Russian imports.
B) Russian manufacturers to become more efficient.
C) Russian consumers to pay lower prices for a wider variety of products.
D) most countries to reduce their own trade barriers to be able to better compete with
Russian imports at home.
Free trade ________ living standards by ________ economic efficiency.
A) raises; increasing
B) lowers; decreasing
C) raises; equalizing
D) lowers; eliminating
What impact does a decrease in the price level in the United States have on net exports
and why?
A) A decrease in the price level increases net exports because lower prices increase the
value of the dollar.
B) A decrease in the price level increases net exports by reducing the relative cost of
American goods.
C) A decrease in the price level reduces net exports because lower prices raise the value
of the dollar.
D) A decrease in the price level reduces net exports because lower prices increase
American spending on imports.
Patents, tariffs and quotas are all examples of
A) government-imposed barriers.
B) economic regulations that increase efficiency.
C) entry barriers that improve a country’s standard of living.
D) entry barriers that protect consumers.
When the Federal Reserve decreases the money supply, at the previous equilibrium
interest rate households and firms will now want to
A) buy Treasury bills.
B) sell Treasury bills.
C) neither buy nor sell Treasury bills.
D) hold less money.
When the Bretton Woods system was set up, the United States agreed initially to buy
and sell gold at a price of ________ per ounce.
A) $24
B) $35
C) $42
D) $48
What would happen in the market for knee replacement surgery if insurance companies
started to cover a smaller portion of the cost of the surgery, and fewer doctors decide to
enter the field of joint replacement surgery?
A) Demand will decrease, but this will not shift the supply curve.
B) Supply will decrease, but this will not shift the demand curve.
C) Demand and supply will both decrease.
D) Demand will decrease and supply will increase.
In a small European country, it is estimated that changing the level of capital from $8
million to $10 million will increase real GDP from $2 million to $3 million. If the
number of hours worked in the labor force does not change, what does this information
tell you about the slope of the per-worker production function in this range?
A) The slope is -2.
B) The slope is 1/2.
C) The slope is 2.
D) The slope is 4.
Figure 2-1
Point C is
A) technically efficient.
B) unattainable with current resources.
C) inefficient in that not all resources are being used.
D) the equilibrium output combination.
________ of unemployment during ________ make it easier for workers to ________
wages.
A) High levels; a recession; accept lower
B) Low levels; an expansion; accept lower
C) Low levels; a recession; negotiate higher
D) High levels; an expansion; negotiate higher
Which of the following statements regarding the use of gold as money is false?
A) It has standardized quality.
B) It is durable.
C) It has value other than money.
D) It is acceptable to traders.
Figure 16-1
Suppose the economy is in a recession and expansionary fiscal policy is pursued. Using
the static AD–AS model in the figure above, this would be depicted as a movement from
A) A to B.
B) B to C.
C) C to B.
D) B to A.
E) A to E.
The Gini coefficient is measured by
A) summing up the cumulative income percentages on the Lorenz curve.
B) summing up the total income earned by the population and dividing by the size of
the population.
C) using the formula: area between perfect inequality and Lorenz curve · area between
the line of perfect equality to the Lorenz curve.
D) using the formula: area between the line of perfect equality and the Lorenz curve ·
the area under the line of perfect equality.