Jack was unemployed two weeks ago but just started a new job. As a result of this
increase in the number of employed workers, which of the following occurred?
A) The labor force participation rate increased.
B) The unemployment rate increased.
C) The labor force participation rate decreased.
D) The unemployment rate decreased.
Consider the following pricing strategies:
a. perfect price discrimination
b. charging different prices to different groups of customers
c. optimal two-part tariff
d. single-price monopoly pricing Which of the pricing strategies leads to the
economically efficient output level?
A) a only
B) a and b only
C) a and c only
D) a, b, and c only
Figure 9-7
Fenwick currently both produces and imports pistachios. The government of Fenwick
decides to restrict international trade in pistachios by imposing a quota that allows
imports of only 5 million pounds each year. Figure 9-7 shows the estimated demand and
supply curves for pistachios in Fenwick and the results of imposing the quota. Answer
questions a-j using the figure.
a. If there is no quota what is the domestic price of pistachios and what is the quantity
of pistachios demanded by consumers?
b. If there is no quota how many pounds of pistachios would domestic producers supply
and what quantity would be imported?
c. If there is no quota what is the dollar value of consumer surplus?
d. If there is no quota what is the dollar value of producer surplus received by producers
in Fenwick?
e. If there is no quota what is the revenue received by foreign producers who supply
pistachios to Fenwick?
f. With a quota in place what is the price that consumers of Fenwick must now pay and
what is the quantity demanded?
g. With a quota in place what is the dollar value of consumer surplus? Are consumers
better off?
h. With a quota in place what is the dollar value of producer surplus received by
producers in Fenwick? Are domestic producers better off?
i. Calculate the revenue to foreign producers who are granted permission to sell in
Fenwick after the imposition of the quota.
j. Calculate the deadweight loss as a result of the quota.
Table 4-6
The table above lists the marginal cost of polo shirts by Marko’s, a firm that specializes
in producing men’s clothing. If the price of polo shirts increases from $15 to $20,
A) consumers will buy no polo shirts.
B) the marginal cost of producing the third polo shirt will increase to $20.
C) producer surplus will rise from $13 to $28.
D) there will be a surplus of polo shirts.
Table 18-9
Table 18-9 shows the income tax brackets and tax rates for single taxpayers in
Monrovia. Sylvia is a single taxpayer with an income of $70,000. What is her marginal
tax rate and what is her average tax rate?
A) marginal tax rate = 30%; average tax rate = 30%
B) marginal tax rate = 8%; average tax rate = 19.3%
C) marginal tax rate = 30%; average tax rate = 22.5%
D) marginal tax rate = 20%; average tax rate = 30%
Tanesha sells homemade candles over the Internet. Her annual revenue is $64,000 per
year, the explicit costs of her business are $17,000, and the opportunity costs of her
business are $22,000. What is her accounting profit?
A) $17,000
B) $22,000
C) $47,000
D) $64,000
Economist Robert Fogel has estimated that by the year 2040, individuals in the United
States will be spending
A) more time in the workforce and more time in leisure activities than they do today.
B) less time in the workforce and less time in leisure activities than they do today.
C) less time in the workforce and more time in leisure activities than they do today.
D) more time in the workforce and less time in leisure activities than they do today.
Which of the following would cause a decrease in the equilibrium price and decrease in
the equilibrium quantity of papayas?
A) a decrease in supply and an increase in demand
B) a decrease in demand
C) an increase in supply and an increase in demand greater than the increase in demand
D) a decrease in supply and a decrease in demand
Figure 12-12
Consider a typical firm in a perfectly competitive industry that makes short-run profits.
Which of the diagrams in the figure shows the effect on the industry as it transitions to a
long-run equilibrium?
A) Panel A
B) PanelB
C) PanelC
D) PanelD
Table 2-19
Table 2-19 shows the output per month of two people, Wilma and Betty. They can either
devote their time to making marble statues or making marble benches.
What is Wilma’s opportunity cost of making a statue?
A) 1/3 bench
B) 3 benches
C) 6/7 statue
D) 1/2 bench
Figure 4-5 Figure 4-5 shows the
market for apartments in Bay City. Recently, the government imposed a rent ceiling at
R0. What area represents the deadweight loss after the imposition of the ceiling?
A) G + H
B) J + H
C) C + E + J + H
D) C + E
Which of the following is most likely to exert the bargaining power of a buyer?
A) Barnes and Noble purchases books from publishers for sale in its online stores.
B) Wal-Mart, the world’s largest discount store, seeks vendors to supply products made
exclusively for its stores.
C) Ground beef producers seek to purchase cattle from ranchers.
D) Cowgirl Creamery, a small cheese producer, seeks a dairy farm for its organic milk
supplies.
Figure 3-7
Assume that the graphs in this figure represent the demand and supply curves for rice.
What happens in this market if buyers expect the price of rice to fall?
A) Panel (a)
B) Panel (b)
C) Panel (c)
D) Panel (d)
Goods and services bought domestically but produced in other countries are referred to
as
A) exports.
B) imports.
C) transfer payments.
D) foreign consumption.