1)
Refer to the diagram pertaining to two nations and a specific product. Point G is the:
A.domestic price for the nation represented by lines FA and FC.
B.world equilibrium price.
C.domestic price for the nation represented by lines GB and GD.
D.price above the world equilibrium price.
2) Investment in kind refers to the possibility that:
A.DVCs will invest for the purpose of becoming less dependent on world markets.
B.a DVC will overinvest in industries in which it has a comparative advantage,
disrupting its development program.
C.newly established manufacturing firms may expand by reinvesting their profits.
D.surplus labor in, say, agriculture can be diverted to the production of simple capital
goods such as earthen dams.
3) A constant-cost industry is one in which:
A.resource prices fall as output is increased.
B.resource prices rise as output is increased.
C.resource prices remain unchanged as output is increased.
D.small and large levels of output entail the same total costs.
4)
Refer to the information. Over the $9-$7 price range, demand is:
A.perfectly elastic.
B.perfectly inelastic.
C.elastic.
D.inelastic.
5) A firm finds that at its MR = MC output, its TC = $1,000, TVC = $800, TFC = $200,
and total revenue is $900. This firm should:
A.shut down in the short run.
B.produce because the resulting loss is less than its TFC.
C.produce because it will realize an economic profit.
D.liquidate its assets and go out of business.
6)
Curve (3) in the diagram is a purely competitive firm’s:
A.total cost curve.
B.total revenue curve.
C.marginal revenue curve.
D.total economic profit curve.
7) The demand curve faced by a monopolistically competitive firm:
A.Is more elastic than the monopolist’s demand curve
B.Is less elastic than the monopolist’s demand curve
C.Will shift outward as new firms enter the industry
D.Is more elastic than the demand curve faced by the purely competitive firm
8) Taxable income is:
A.total income less deductions and exemptions.
B.the same as gross income.
C.the only income to which marginal tax rates apply.
D.the sum of all wage and property income.
9) The table shows an indifference schedule for several combinations of X and Y.
Refer to the above table. In moving from combination b to c, the consumer:
A.Gets 1 unit of X for 1 unit of Y
B.Gets 2 units of X for 2 units of Y
C.Gets 3 units of X for 1 unit of Y
D.Gives up 4 units of X for 1 unit of Y
10) In the short run, fixed costs for a profitable firm are:
A.Zero
B.Negative
C.Important determinants of the output level
D.Irrelevant in determining the optimal level of output
11) The following statements about behavioral economics are true, except:
A.Its insights help policymakers determine how to nudge people to make certain
choices
B.It combines insights from economics, psychology, and neuroscience to better
understand how people behave
C.It assumes that people are always rational, deliberate, and objective in their choices
D.It studies how people deal with choices involving “goods” as well as “bads”