Which is the least common type of business?
A) corporation
B) partnership
C) sole proprietorship
D) impossible to determine without further information
Which of the following causes the unemployment rate to understate the true extent of
joblessness?
A) Many full time workers really want to be part time workers.
B) Persons who collect unemployment benefits report themselves to be searching for a
job.
C) Discouraged workers are not counted as unemployed.
D) A drug dealer reports herself as unemployed.
E) Discouraged workers are counted as unemployed.
The largest source of federal government revenue in 2012 was
A) sales taxes.
B) corporate income taxes.
C) individual income taxes.
D) payroll taxes to fund Social Security and Medicare programs.
Table 4-6
The equations above describe the demand and supply for Chef Ernie’s Sushi-on-a-Stick.
What are the equilibrium price and quantity (in thousands) for Chef Ernie’s sushi?
A) $80 and 80 thousand
B) $60 and 20 thousand
C) $50 and 100 thousand
D) $40 and 50 thousand
Imagine that you borrow $1,000 for one year and at the end of the year you repay the
$1,000 plus $100 of interest. If the inflation rate was 7%, what was the real interest rate
you paid?
A) 17 percent
B) 10 percent
C) 7 percent
D) 3 percent
Table 2-8
The Nut House produces only cashews and almonds. The table aboveshows the
maximum possible output combinations of the two nuts using all resources and
currently available technology. a. Graph The Nut House’s production possibilities
frontier. Put almonds on the horizontal axis and cashews on the vertical axis. Be sure to
identify the output combination points on your diagram.
b. Suppose The Nut House is currently producing at point C. What is the opportunity
cost of producing an additional 12,000 pounds of almonds?
c. Suppose The Nut House is currently producing at point C. What happens to the
opportunity cost of producing more and more almonds? Does it increase, decrease or
remain constant? Explain your answer.
d. Suppose The Nut House is currently producing at point F. What happens to the
opportunity cost of producing more and more cashews? Does it increase, decrease or
remain constant? Explain your answer.
e. Suppose The Nut House is plagued by a variety of white root-rot disease, which
destroys cashew trees but not almond trees. Show in a graph what happens to its PPF.
According to the real business cycle model, ________ in aggregate demand ________
GDP.
A) increases; decrease
B) increases; increase
C) increases; do not affect
D) decreases; increase
Figure 13-17
In the long run, why will the firm produce Qfunits and not Qgunits, which has a lower
its average cost of production?
A) Although its average cost of production is lower when the firm produces Qgunits, to
be able to sell its output the firm will have to charge a price below average cost,
resulting in a loss.
B) At Qg, average cost exceeds marginal cost so the firm will actually make a loss.
C) At Qg, marginal revenue is less than average revenue which will result in a loss for
the firm.
D) The firm’s goal is to charge a high price and make a small profit rather than a low
price and no profit.
Figure 12-8
Suppose the firm produces 4,000 units. What does the shaded area labeled A represent?
A) total variable cost
B) profit
C) total fixed cost
D) total revenue
A number of economists have estimated the impact of unionization on workers’ wages.
Which of the following is one conclusion reached by these studies?
A) Union workers earn less than they would if they were not unionized. This is because
of the impact of workers’ strikes, during which union members do not receive wages.
B) Holding constant the impact of other factors that affect wages, being in a union has
no impact on a worker’s wages.
C) Being in a union increases a worker’s wages by about 10 percent, holding constant
other factors that influence wages.
D) The share of national income received by workers has increased significantly over
time; unions have been responsible for about one-half of the increase in workers’ share
of national income from the end of World War II to 2000.