1) which of the following is a supply factor in the health care market?
a.defensive medicine
b.the aging of the population
c.slow productivity growth in the health care industry
d.asymmetric information
2) A major purpose of usury laws is to make more funds available to low-income
borrowers. Economic analysis suggests that usury laws:
A.are effective in achieving this goal.
B.allocate available funds to high-income borrowers.
C.have no impact on the allocation of funds between high-income and low-income
people.
D.help low-income people only when the legal interest rate is above the market rate.
3) Government can push the unemployment rate below the natural rate only by:
A.instituting supply-side economic policies.
B.producing a higher rate of inflation than people expect.
C.balancing the federal budget.
D.achieving zero inflation.
4)
refer to the above diagram. if price falls from p1to p2, total revenue will become
area(s):
a.b + d
b.c + d
c.a + c
d.c
5) economic growth is best defined as an increase in:
a.either real gdp or real gdp per capita.
b.nominal gdp.
c.total consumption expenditures.
d.wealth in the economy.
6) in the short run, a purely competitive firm will earn a normal profit when:
a.p = avc.
b.p > mc.
c.that firm’s mr = market equilibrium price.
d.p = atc.
7)
refer to the above data. the domestic opportunity cost of producing 1 ton of steel in
omega is:
a. ton of wheat.
b.2 tons of wheat.
c.3 tons of wheat.
d.5 tons of wheat.
8)
Refer to the above graphs. Terryville has a comparative advantage in producing:
A.product A
B.product B
C.both product A and B
D.neither product A nor B
9) when compact disc (cd) players first came on the market, they sold for over $1,000.
now they cost only $100. these facts imply that:
a.the cd industry was once competitive, but is now monopolistic.
b.fewer firms produce cd players than was the case five or ten years ago.
c.the demand curve for cd players has shifted leftward.
d.the cd player industry is a decreasing-cost industry.
10)
In the above diagram, economic discrimination is best represented by point:
A.A.
B.C rather than D or E.
C.E rather than D or C.
D.F.
11)
refer to the above long-run cost diagram for a firm. if the firm produces output q2 at an
average cost of atc3, then the firm is:
a.producing the profit-maximizing output, but is failing to minimize production costs.
b.incurring x-inefficiency, but is realizing all existing economies of scale.
c.incurring x-inefficiency and is failing to realize all existing economies of scale.
d.producing that output with the most efficient combination of inputs and is realizing all
existing economies of scale.
12) Over the next fifteen years, ___ out of 10 people added to the world’s population
will be born in developing countries.
A.6
B.7
C.8
D.9
13) We say that the demand for labor is a derived demand because:
A.labor is a necessary input in the production of every good or service.
B.we demand the product that labor helps produce rather than labor service per se.
C.the forces of supply and demand do not apply directly to labor markets.
D.labor is hired using the MRP = MRC rule.
14) when the price of nike soccer balls fell, ronaldo purchased more nike soccer balls,
and fewer adidas soccer balls. which of the following best explains ronaldo’s decision to
buy more nike soccer balls?
a.the substitution effect
b.the income effect
c.an increase in the demand for nike soccer balls
d.the price effect
15)
refer to the above diagram, in which solid arrows reflect real flows; broken arrows are
monetary flows. flow (5) might represent:
a.personal income tax revenues.
b.the provision of public schools by local governments.
c.the purchase of laptop computers by the state of iowa.
d.transfer payments to unemployed workers.
16) If a bank has liabilities that exceed its net worth it:
A.will not be able to meet the legal reserve ratio.
B.is considered to be insolvent.
C.most likely is a heavy borrower from its district Federal Reserve Bank.
D.may or may not be a profitable firm.
17) The following domestic supply and demand schedules for a product. Suppose that
the world price of the product is $1.
Refer to the above data. With a $1 dollar per unit tariff, price and total quantity sold will
be:
A.$3 and 7 units.
B.$5 and 2 units.
C.$2 and 7 units.
D.$2 and 11 units.
18) In which of the following sets of circumstances can we confidently expect
inflation?
A.aggregate supply and aggregate demand both increase
B.aggregate supply and aggregate demand both decrease
C.aggregate supply decreases and aggregate demand increases
D.aggregate supply increases and aggregate demand decreases