1) an increase in quantity supplied might be caused by an increase in production costs.
2) If the United States and France are both on the international gold standard and U.S.
exports to France exceed United States imports from France, gold will flow from the
United States to France.
3) Human capital investment refers to spending on education and worker training.
4) Efficiency wage theory says that an above-market wage can reduce labor costs per
unit of output by eliciting greater work effort, lowering supervision costs, and reducing
job turnover.
5) the wto is comprised of 27 european nations.
6) in a purely competitive industry competition centers more on advertising and sales
promotion than on price.
error! hyperlink reference not valid.
7) as a consumer moves down a given indifference curve, his or her total utility will
diminish.
8) The Fed reduces interest rates mainly by selling government securities.
9) The monopsonist in a nonunionized labor market pays a wage rate below the MRP of
labor.
10) U.S. exports of farm products have generally declined as a percentage of U.S. farm
output over the past half-century.
11) Built-in stability is synonymous with discretionary fiscal policy.
12) answer the next question(s) on the basis of the following data. all figures are in
billions of dollars.
refer to the above data. consumption of fixed capital is:
a.$5.
b.$10.
c.$20.
d.$30.
13) If a nation has a current account deficit and it does not have to make any
inpayments or outpayments of official reserves, it must have a:
A.surplus in its capital and financial account.
B.balance of payments deficit.
C.balance of payments surplus.
D.deficit in its capital and financial account.
14) If a single large employer bargains with an inclusive union, the resulting labor
market model can best be described as:
A.a cartel.
B.countervailing power.
C.a bilateral monopoly.
D.an internal labor market.
15)
Refer to the above diagram showing the domestic demand and supply curves for a
specific standardized product in a particular nation. If the world price of this product is
$1, this nation will:
A.export all of the product.
B.import all of the product.
C.import some of the product and produce some of the product domestically.
D.neither export nor import the product.
16) unimpeded immigration between two nations tends to:
a.increase business income in both nations.
b.increase business income in the nation receiving immigrants, but reduce it in the
nation experiencing emigration.
c.reduce business income in the nation receiving immigrants, but increase it in the
nation experiencing emigration.
d.reduce business income in both nations.
17) A market in which the entire demand for a good or service can be satisfied at the
least cost by a single firm is a:
A.horizontal market.
B.natural monopoly.
C.contestable market.
D.perfect market.
18) In an aggregate expenditures diagram, a lump-sum tax (T) will:
A.not affect the C + Ig + Xn line.
B.shift the C + Ig + Xn line upward by an amount equal to T.
C.shift the C + Ig + Xn line downward by an amount equal to T.
D.shift the C + Ig + Xn line downward by an amount equal to T MPC.
19)
refer to the above diagram. the firm’s supply curve is the segment of the:
a.mc curve above its intersection with the avc curve.
b.mc curve above its intersection with the atc curve.
c.avc curve above its intersection with the mc curve.
d.atc curve above its intersection with the mc curve.
20)
refer to the above graph. which one of the following would cause a move from point b
to point c along short-run average total cost curve atc1?
a.diminishing marginal returns
b.an increase in the wage rate
c.a decrease in the wage rate
d.increasing marginal returns
21) suppose smith pays $100 to jones.
a.we can say with certainty that the gdp has increased by $100.
b.we can say with certainty that the gdp has increased, but we cannot determine the
amount.
c.we can say with certainty that the nominal gdp has increased, but we can’t say whether
real gdp has increased or decreased.
d. we need more information to determine whether gdp has changed.
22) which of the following is not a source of economies of scale?
a.learning-by-doing.
b.labor specialization.
c.use of larger machines.
d.inelastic resource supply curves.
23) if a firm wanted to know how much it would save by producing one less unit of
output, it would look to:
a.mc.
b.atc.
c.avc.
d.afc.
24)
refer to the above diagram. line (2) reflects a situation where resource prices
a.decline as industry output expands.
b.increase as industry output expands.
c.rise and then decline as industry output expands.
d.remain constant as industry output expands.
25)
Which of the above nations would be low-income developing countries (DVCs),
according to the World Bank?
A.country A only
B.countries A, D, and E
C.countries A and E
D.countries A, B, D, and E
26)
Refer to the above diagram, where Sd and Dd are the domestic supply and demand for a
product and Pc is the world price of that product. Sd + Q is the product supply curve
after an import quota is imposed. Assuming there is no tariff, the import quota:
A.will increase United States Treasury revenue by areas G + H
B.will increase United States Treasury revenue by areas E + F + G + H + J
C.may either increase or decrease the total revenues of foreign producers, depending on
the elasticity of domestic demand.
27)
refer to the above diagram, which pertains to a purely competitive firm. curve a
represents:
a.total revenue and marginal revenue.
b.marginal revenue only.
c.total revenue and average revenue.
d.total revenue only.
28) Explain and give examples of invention. What does government do to protect it?
29) Illegal immigration has been shown to have an overall negative fiscal impact on
local and state governments. Describe the fiscal benefits and cost of illegal immigration
for local and state governments.
30) Which is more effective in blocking imports, a tariff or a quota?
31) Assume that an economy has 9000 workers, each working 2000 hours per year. The
average real output per worker-hour is $20. What will the total output or real GDP be?
Explain.
32) What are the simplifications used in this chapter to derive the aggregate
expenditures model?
33) Explain four problems with the argument that trade protection is needed to protect
American jobs.