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1)
Refer to the graph above, where Sd and Dd are the domestic supply and demand for a
product. The world price of the product is $6. What would be the difference in the total
revenue received by foreign producers after a quota of 20 units is imposed compared
with the total revenue received by foreign producers when a $4 per unit tariff is
imposed?
A.$0 revenue difference
B.$80 more revenue with a quota than with a tariff
C.$200 more revenue with a quota than with a tariff
D.$120 more revenue with a tariff than with a quota
2) Which one of the following research findings is most consistent with the hypothesis
that unions increase productivity?
A.Other things equal, firm profits are lower where unions are present.
B.Union workers receive, on average, higher fringe benefits relative to wages than
nonunion workers.
C.The average amount of work time lost annually to strikes is surprisingly small.
D.Labor turnover is less in unionized firms than in nonunionized firms.
3) In recent decades:
A.all countries classified as DVCs have had little or no economic growth.
B.some nations classified as DVCs have grown rapidly while others have grown very
slowly or not at all.
C.all countries classified as DVCs have experienced rapid economic growth and rising
living standards.
D.all countries classified as low-income DVCs have had declining per capita GDPs.
4) Which of the following factors is not a typical cause of changes in land rent?
A.Demand for land
B.Supply of land
C.Prices of the products produced from the land
D.Prices of other resources employed along with land
5) The theory of creative destruction was advanced many years ago by:
A.Bill Gates.
B.Alfred Marshall.
C.Joseph Schumpeter.
D.Adam Smith.
6) U.S. exports of goods and services (on a national income account basis) are about:
A.20 percent of U.S. GDP.
B.8 percent of U.S. GDP.
C.28 percent of U.S. GDP.
D.14 percent of U.S. GDP.
7)
Consider a company town where the ABC Corporation is the only employer. Assume
ABC sells its output in a purely competitive market. The city council is considering a
proposal to lower the minimum wage from its current level of W2 to W1, as shown in
the graph above. Given the marginal revenue product of labor (MRP), labor supply
(SL), and marginal cost of labor (MRC) curves, this policy would:
A.Increase employment from L1 to L2
B.Increase employment from L1 to L3
C.Reduce employment from L4 to L3
D.Reduce employment from L1 to L0
8)
Refer to the table, in which the values for columns (2) through (5) are in acres. If the
relevant columns are (1), (2), and (5), land rent will be:
A.$0 per acre.
B.$100 per acre.
C.$200 per acre.
D.$300 per acre.
9) Economists who have studied the composition of "proprietor's income" have found
that this income item is made up of:
A.Wages and profits, mostly wages
B.Interest and profits, mostly profits
C.Rent and interest, mostly interest
D.Wages and interest, mostly wages
10) Linda fishes for mahi mahi at a cost of $10 per ton, while Tessa fishes at a cost of
$8 per ton. Both have one 1000 ITQ and the current market price is $13 per ton. If
Linda sold her ITQ to Tessa for $3000, she and Tessa would:
A.Make the sale because they're both better off
B.Not make the sale because Linda is better off and Tessa is not
C.Not make the sale because Tessa is better of and Linda is not
D.Not make the sale because neither is better off
11) Which of the following is true concerning purely competitive industries?
A.There will be economic losses in the long run because of cut-throat competition.
B.Economic profits will persist in the long run if consumer demand is strong and stable.
C.In the short run, firms may incur economic losses or earn economic profits, but in the
long run they earn normal profits.
D.There are economic profits in the long run but not in the short run.
