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1) Taxes on commodities or on purchases are known as:
A.corporate income taxes.
B.sales and excise taxes.
C.personal income taxes.
D.payroll taxes.
2) The fundamental cause of agricultural price and income instability in the United
States has been a(n):
A.Lack of foreign demand for U.S. agricultural products
B.Lack of efficiency in the farm sector of the American economy
C.Underallocation of resources to the farm sector of the economy relative to that of the
nonfarm sector
D.Overallocation of resources to the farm sector of the economy relative to that of the
nonfarm sector
3)
Refer to the payoff matrix. Suppose that Speedy Bike and Power Bike are the only two
bicycle manufacturing firms serving the market. Both can choose large or small
advertising budgets. If this is a repeated game with no cooperation or reciprocity, which
cell represents the final outcome we would expect to occur?
A.A
B.B
C.C
D.D
4) When the price of candy bars decreased from $0.55 to $0.45 the quantity demanded
changed from 19,000 per day to 21,000 per day. In this price range, the price-elasticity
coefficient (based on the midpoint formula) for candy bars is:
A.1
B.2
C.0.2
D.0.5
5) Fixed costs are associated with:
A.highly adjustable inputs such as labor.
B.both the short run and the long run.
C.the short run only.
D.the long run only.
6) In many of the sub-Saharan African nations:
A.population is growing more rapidly than food production.
B.population growth is causing deforestation and diminished land quality.
C.governments have favored investment in industry and military spending rather than
investment for agriculture.
D.all of these have been true.
7) The following are hypothetical exchange rates: $1 = 140 yen; 1 Swiss franc = $.10.
We can conclude that:
A.1 yen = 280 Swiss francs.
B.1 yen = 14 Swiss francs.
C.1 Swiss franc = 28 yen.
D.1 Swiss franc = 14 yen.
8) The table shows cost data for a firm that is selling in a purely competitive market.
Refer to the above cost table. If the price of the product is $6, what output level will the
firm produce?
A.0
B.12
C.14
D.16
9) If a firm is hiring a certain type of labor under purely competitive conditions:
A.its labor demand curve will be perfectly elastic at the market-determined wage rate.
B.the labor supply curve will lie above the marginal labor cost curve.
C.the labor supply and marginal labor (resource) cost curves will coincide and be
upsloping.
D.the labor supply and marginal labor (resource) cost curves will coincide and be
perfectly elastic.
10)
Refer to the above table. How many units of a resource would the profit-maximizing
firm use if the price of this resource was $19.00?
A.1
B.2
C.3
D.4
11)
Which of the given nations would be high-income countries (IACs), according to the
World Bank?
A.Country C only.
B.Countries B, C, and D.
C.Countries B, C, D, and E.
D.Countries B and C.
12) In a labor market generally biased against Hispanics, a reduction in the collective
discrimination coefficients of employers will:
A.reduce the Hispanic wage rate, increase Hispanic employment, and lower the actual
Hispanic-white wage ratio.
B.reduce the Hispanic wage rate, decrease Hispanic employment, and lower the actual
Hispanic-white wage ratio.
C.increase the Hispanic wage rate, increase Hispanic employment, and increase the
actual Hispanic-white wage ratio.
D.increase the Hispanic wage rate, reduce Hispanic employment, and increase the
actual Hispanic-white wage ratio.
13) Answer the question on the basis of the following table that shows the total costs
and total benefits facing a city of five different potential baseball stadiums of increasing
size. All figures are in millions of dollars.
Refer to the table. Suppose a five-person city council must decide via majority voting
which of these stadiums to build. Also suppose that each of the stadium sizes has the
support of one council member. According to the median voter model, the council will
ultimately vote in favor of stadium:
A.A.
B.B.
C.C.
D.D.
14) In long-run equilibrium, both purely competitive and monopolistically competitive
firms will:
A.produce at minimum average total cost.
B.earn economic profits.
C.achieve allocative efficiency.
D.equate marginal cost and marginal revenue.
15)
Refer to the diagram in which S is the before-tax supply curve and St is the supply
curve after an excise tax is imposed. The total tax payment to government is shown by
area(s):
A.A only.
B.A + B + C + E + F.
C.A + B + C.
D.E + F.
16) Assume that a consumer has a given budget or income of $12, and that she can buy
only two goods, apples or bananas. The price of an apple is $1.50 and the price of a
banana is $0.75.
Refer to the information given above. What is the slope of the budget line, if the
quantity of apples were measured on the horizontal axis and bananas on the vertical
axis?
A.-0.5
B.-0.8
C.-1.6
D.-2.0
17) Authoritative estimates suggest that currently union workers on the average:
A.achieve no wage advantage over nonunion workers in the same occupation.
B.realize a 5 percent wage advantage over nonunion workers in the same occupation.
C.realize a 20-30 percent wage advantage over nonunion workers in the same
occupation.
D.realize a 15 percent wage advantage over nonunion workers in the same occupation.
18) Intel's monopoly in the sale of microchips for personal computers would be
considered:
A.Legal by "behaviorists" but illegal by 'structuralists"
B.Legal by "behaviorists" and 'structuralists"
C.Illegal by "behaviorists" and 'structuralists"
D.Illegal by "behaviorists" but legal by 'structuralists"
19)
Refer to the above graph of the market for wheat. The government adopts a price
support program for wheat, and supports the wheat price at P2. The area of 0P2AQ1
would measure the:
A.Total amount received by wheat farmers
B.Total profits of wheat farmers
C.Amount the government will pay to wheat farmers
D.Amount private buyers of wheat will pay to wheat farmers
20) The settling of any net deficit in the combined current, and capital and financial
accounts is done with:
A.Capital reserves
B.Official reserves
C.Net transfers
D.Net investment income
21) In both the case of the CPA painting her house and the painter filing his taxes, what
is the determining factor that causes them to use professional services? What is the
benefit of this specialization?
22) What factors have contributed to growing inequality in incomes in the United
States?
23) What is the main difference between the law of demand and the price elasticity of
demand?
24) What is the natural resource problem in DVCs?
25) What is the difference between capital-using and capital-saving technological
advances? Give examples.
26) What role does the interest rate play in the economy? Is the distinction between real
and nominal interest rates an important one in discussing these roles?
27) What is the major argument in the case for income equality?
28) Given the data in the graph below, which nation should specialize in steel
production and which nation in wheat production? Why?
29) Cite three important reasons why nations trade.
