1) which of the following statements applies to a purely competitive producer?
a.it will not advertise its product.
b.in long-run equilibrium it will earn an economic profit.
c.its product will have a brand name.
d.its product is slightly different from those of its competitors.
2)
answer on the basis of the relationships shown in the above four figures. the amount of
y is inversely related to the amount of x in:
a.2 only.
b.both 1 and 3.
c.3 only.
d.1 only.
3) Which of the following measurement issues make interpretation of U.S. poverty rates
difficult?
A.Poverty statistics measure consumption rather than income, and some families may
receive income that is above the official poverty line.
B.The high cost of living in urban areas tends to result in the understatement of poverty.
C.Most people below the poverty line have substantial unreported income.
D.The poverty rate is adjusted for every urban and rural area, so people’s poverty status
changes whenever they move.
4) The more inelastic is demand and supply the:
A.larger is the efficiency loss of an excise tax.
B.smaller is the efficiency loss of an excise tax.
C.higher the proportion of an excise tax paid by consumers.
D.smaller the proportion of an excise tax paid by producers.
5) Which of the following is correct?
A.The nominal wage may fall, but the real wage can never decline.
B.The real wage may fall, but the nominal wage can never decline.
C.Both the nominal and the real wage must always rise.
D.The nominal and the real wage may both fall.
6) The U.S. income maintenance program consists of two kinds of programs. They are:
A.the minimum wage law and Social Security.
B.antidiscrimination law and education and training programs.
C.social insurance and public assistance or “welfare.”
D.progressive income taxes and transfer payments.
7) The total fertility rate necessary to keep the population constant is approximately
equal to:
A.1.0
B.1.5
C.2.1
D.3.0
8)
refer to the budget line shown in the diagram above. if the consumer’s money income is
$20, which of the following combinations of goods is unattainable?
a.4 units of c, and 6 units of d.
b.5 units of c, and no units of d.
c.1 unit of c, and 8 units of d.
d.2 units of c, and 6 units of d
9) The immediate-short-run aggregate supply curve is:
A.downward sloping.
B.upward sloping.
C.vertical.
D.horizontal.
10)
The total demand for money curve in the above market for money would graph as a:
A.vertical line.
B.horizontal line.
C.line sloping upward to the right.
D.line sloping downward to the right.
11) Complete the following table, where L is the units of labor, TPL is the total product
of labor, MPL is the marginal product of labor, P is product price, TR is total revenue,
and MRPL is the marginal revenue product of labor.
(a)In what type of market is the firm selling its product? How do you know?
(b)Why does the MRP schedule decrease as labor increases?
(c)Complete the following table.
12) Which of the following describes the vicious circle of poverty?
A.Government spending for public goods is inflationary and this undermines incentives
to save and invest.
B.Higher incomes increase consumption at the expense of capital accumulation, which
causes income to fall.
C.Low per capita incomes cause low levels of saving and investment, which mean low
productivity and therefore low incomes.
D.A growing national income increases the demand for money, which increases the
interest rate and reduces investment.
13) Assume the government purposely incurs a budget deficit that is financed by
borrowing. As a result, interest rates rise and the amount of private investment spending
declines. This illustrates:
A.the equation-of-exchange effect.
B.the paradox of thrift.
C.the crowding-out effect.
D.the wealth effect.
14) In terms of aggregate supply, the short run is a period in which:
A.the price level is constant.
B.employment is constant.
C.real output is constant.
D.nominal wages and other resource prices are unresponsive to price-level changes.
15) assume a household would consume $100 worth of goods and services per week if
its weekly income were zero and would spend an additional $80 per week for each $100
of additional income. letting c represent consumption and y represent income, the
equation that summarizes this relationship is:
a.c = 80 + 100y.
b.c = 100 + .8y.
c.c = 100 + 80y.
d.c = 80 + .1y.
16) In 2007, about ____ percent of the U.S. public debt was held by people and
institutions abroad.
A.42
B.18
C.25
D.33
17) assume a diagram in which a budget line is imposed on an indifference map. a
consumer will maximize her utility:
a.at any point where the budget line and an indifference curve intersect.
b.at either point where the budget line intersects the horizontal and vertical axes.
c.where the budget line is tangent to an indifference curve.
d.where the ratio of the two product prices equals the reciprocal of the consumer’s
income.
18) A basic criticism of supply-side economics is that:
A.empirical research clearly shows that incentives to work and invest vary directly with
marginal tax rates.
B.lower taxes will increase aggregate supply much more than they will increase
aggregate demand.
C.lower taxes will increase aggregate demand much more than they will increase
aggregate supply.
D.higher taxes will reduce incentives to work, invest, and innovate.