A subgame is a simultaneous game embedded in a sequential game.
Marketing refers to all the activities necessary for a firm to sell a product to a consumer.
If nominal GDP is less than real GDP, then the GDP deflator will be greater than 100.
If two countries adhere to a gold standard, the exchange rate for their currencies is
fixed.
The majority of the federal government debt is held by government agencies.
Some researchers have been unable to find evidence of increasing returns to human
capital.
Counting part-time workers who are looking for full-time work as employed overstates
the degree of joblessness in the economy.
If the marginal product of labor is decreasing, then marginal cost of production must be
rising.
A surplus occurs when the market price is lower than the equilibrium price.
If aggregate expenditure is more than GDP, then inventories fall and GDP rises.
National saving equals
A) income – taxes – consumption.
B) taxes – government spending.
C) income – consumption – government spending.
D) private saving + public saving – net foreign investment.
About ________ of pharmaceutical patents are issued to U.S. firms.
A) 10 percent
B) one-half
C) two-thirds
D) 90 percent
Some markets have many buyers and sellers but fall into the category of monopolistic
competition rather than perfect competition. The most common reason for this is
A) there are high barriers to entering these markets.
B) firms in these markets sell identical products.
C) firms in these markets make high profits.
D) firms in these markets do not sell identical products.
When people became less concerned with the underlying value of their houses and
instead focused on the expectations of the prices of their houses increasing, ________
occurred.
A) stagflation
B) an automatic destabilizer
C) a housing bubble
D) a supply shock
Table 1-4
Eva runs a small bakery in the village of Roggerli. She is debating whether she should
extend her hours of operation. Eva figures that her sales revenue will depend on the
number of hours the bakery is open as shown in the table above. She would have to hire
a worker for those hours at a wage rate of $12 per hour.. What is Eva’s marginal benefit
if she decides to stay open for two hours instead of one hour?
A) $25
B) $36
C) $60
D) $95
A restaurant sells a large soft drink at a fixed price of $1.79. A term used by economists
to describe the money received from the sale of an additional large soft drink is
A) marginal revenue.
B) gross earnings.
C) pure profit.
D) net benefit.
The actual division of the burden of a tax is called
A) tax credit.
B) tax incidence.
C) excess burden.
D) tax dispersion.
Table 16-3
Julie plans to start a pet-sitting service. She surveyed her neighborhood to determine the
demand for this service. Assume that each person surveyed demands only one hour of
pet sitting services per period. Table 16-3 above shows a portion of her survey results.
Suppose Julie’s marginal cost of providing this service is constant at $7 and she decides
to charge each customer according to his or her willingness to pay. What is the value of
consumer surplus by her customers?
A) $39
B) $28
C) $11
D) $0
Figure 18-2 Figure 18-2 shows a
demand curve and two sets of supply curves, one set more elastic than the other.
If the government imposes an excise tax of $1.00 on every unit sold, what is the size of
the deadweight loss, if there is any?
A) the area adcif the supply curve is S0 and the area bec if the supply curve is S1.
B) the area afcdif the supply curve is S0 and the area bfce if the supply curve is S1.
C) the area becf under either supply curve.
D) There is no deadweight loss; revenue raised is used to fund government projects.
In 2013, ________ of Goodyear’s sales were outside North America.
A) only 11 percent
B) more than 60 percent
C) less than half
D) 95 percent
Explain how the CPI is constructed.
Former Alabama Governor George Wallace ran for president several times, once as a
third-party candidate in 1968. Wallace claimed there was “not a dime’s worth of
difference” between the Democratic and Republican parties during one of his
campaigns. How does Wallace’s comment relate to the median voter theorem?
Explain and show graphically how a decrease in household saving affects the
equilibrium interest rate and the equilibrium quantity of loanable funds.
If you pay $14,000 in taxes on an income of $125,000, and $17,400 in taxes on an
income of $144,000, what is your marginal tax rate? Show your work.
Protectionism is usually justified on the basis of one of four arguments. What are those
four arguments?
Explain why it is more difficult to determine the incidence of the corporate income tax
than it is to determine the incidence of the tax on gasoline.