1) Table 13-17
Consider the following table of long-run total cost for four different firms:
Firm 4’s efficient scale occurs at what quantity?
a.2
b.3
c.4
d.5
2) A demand curve shows the relationship
a.between income and quantity demanded.
b.between price and income.
c.between price and quantity demanded.
d.among income, price, and quantity demanded.
3) In the ordered pair (3, 6), 3 is the
a.x-coordinate.
b.y-coordinate.
c.origin.
d.slope.
4) If the government decides to build a new highway, the first step would be to conduct
a study to determine the value of the project. The study is called a
a.budget analysis.
b.project analysis.
c.reimbursement analysis.
d.cost-benefit analysis.
5) Uzbekistan’s Production Possibilities FrontierAzerbaijan’s Production
Possibilities Frontier
Wit
hout trade, Uzbekistan produced and consumed 12 bolts and 36 nails and Azerbaijan
produced and consumed 14 bolts and 24 nails. Then, each country agreed to specialize
in the production of the good in which it has a comparative advantage and trade 16
bolts for 38 nails. As a result, Uzbekistan gained
a.2 bolts and 2 nails and Azerbaijan gained 2 bolts and 18 nails.
b.4 bolts and 2 nails and Azerbaijan gained 2 bolts and 14 nails.
c.14 bolts and 38 nails and Azerbaijan gained 16 bolts and 42 nails.
d.16 bolts and 38 nails and Azerbaijan gained 16 bolts and 38 nails.
6) Suppose there are only two people in the world. Each person’s production
possibilities frontier also represents his or her consumption possibilities when
a.neither person faces trade-offs.
b.the frontiers are straight lines.
c.the frontiers are bowed out.
d.they choose not to trade with one another.
7) Table 18-11
Consider the following daily production data for MadeFromScratch, Inc.
MadeFromScratch sells cupcakes for $2 each and pays the workers a wage of $325 per
day.
Refer to Table 18-11. Assume that MadeFromScratch is a competitive,
profit-maximizing firm. If the market price of cupcakes increases from $2.00 to $2.50,
how many workers would the firm then hire?
a.2 workers
b.3 workers
c.4 workers
d.5 workers
8) Why would a wage differential due to discrimination in hiring be unlikely to persist
in a competitive labor market?
a.There is a cost advantage for firms that do not discriminate.
b.Workers who are victims of discrimination will eventually drop out of the labor
market.
c.Competing firms will hire fewer of the workers who are temporarily victimized by
discrimination.
d.Discrimination cannot exist in markets.
9) Why was OPEC unable to maintain high oil prices in the long run?
a.Demand and supply are both elastic in the long run compared to the short run.
b.Demand and supply are both inelastic in the long run compared to the short run.
c.Demand is elastic and supply is inelastic in the long run compared to the short run.
d.Demand is inelastic and supply is elastic in the long run compared to the short run.
10) In 2011, the average American paid approximately how much to the federal
government in taxes? a. $2,000
b. $2,500
c. $8,000
d. $10,500
11) One problem with government operation of monopolies is that
a.a benevolent government is likely to be interested in generating profits for political
gain.
b.monopolies typically have rising average costs.
c.the government typically has little incentive to reduce costs.
d.a government-regulated outcome will increase the profitability of the monopoly.
12)
Using the midpoint method, what is the price elasticity of supply between $4 and $6?
a. 0.75
b.1.00
c.1.20
d.1.25
13) All else equal, an increase in demand will always increase consumer surplus.
a.True
b.False
14) When the indifference curve is tangent to the budget constraint,
a.a consumer cannot be made better off without an increase in her income or a price
decrease in one of the goods she consumes.
b.the consumer is likely to be at a sub-optimal level of consumption.
c.income is at its optimum for a consumer.
d.indifference curves are likely to intersect.
15) Which of the following industries has the lowest concentration ratio?
a.breakfast cereal
b.electric lamp bulbs
c.household laundry equipment
d.cigarettes
16) Jobs that involve pleasant work, as opposed to jobs that involve unpleasant work,
usually pay
a.higher wages, because jobs that involve pleasant work typically require more
education than do jobs that involve unpleasant work.
b.higher wages, because jobs that involve pleasant work typically require more
well-developed personality skills than do jobs that involve unpleasant work.
c.lower wages, because workers typically are not attracted to jobs that involve
unpleasant work unless there is a monetary inducement.
d.lower wages, because workers who take jobs that involve unpleasant work typically
stay in those jobs for relatively long periods of time and accumulate significant
experience.