Purchasers of corporate bonds lend money to a corporation.
a. True
b. False
There are about 5 million business firms in the Unites States.
a. True
b. False
In the long run, more costs become fixed.
a. True
b. False
The aim of antitrust policy is to
a. provide adequate incentives for inventors and entrepreneurs.
b. prevent firms from acquiring or exercising undue market power.
c. prevent firms from becoming very large.
d. regulate the prices charged by oligopolies.
From 2007 to 2008, the Federal Reserve System reduced interest rates, the price that
borrowers pay. As a result, economists expected that the supply of money would
a. increase.
b. decrease.
c. not change.
d. Uncertain-economic theory has no answer to this question.
When it is cheaper for one firm to produce a particular product, ____ exist(s).
a. economies of scale
b. economies of scope
c. diminishing marginal returns
d. cross-subsidization
Unexpected discoveries of mineral reserves will ordinarily cause the price of these
minerals to increase.
a. True
b. False
A change in one input price will cause the slope of the budget line to change.
a. True
b. False
High-wage workers are
a. more likely than low-wage workers to supply more labor when the wage rate rises.
b. about as likely as low-wage workers to supply more labor when the wage rate rises.
c. less likely than low-wage workers to supply more labor when the wage rate rises.
d. The available evidence does not indicate how high-wage workers and low-wage
workers differ in responding to changes in the wage rate.
A major difference between a monopoly and perfect competition is that monopolies can
earn an economic profit in the long run and a perfectly competitive firm cannot.
a. True
b. False
The presence of scalpers (people selling tickets at a price above the quoted price, P*) at
a recent Super Bowl game suggests that the market for stadium seats could be
represented by which graph in Figure 4-20?
a. 1
b. 2
c. 3
d. 4
A decrease in the unemployment rate will shift the PPF outward from the origin.
a. True
b. False
We observed that the price of a good rises and the quantity purchased also rises.
Everything else being equal, it is consistent that
a. the price of a substitute good fell.
b. the price of a complement rose.
c. income rose.
d. costs of inputs increased.
A tariff has one distinct advantage over a quota. It increases tax revenues to the
government.
a. True
b. False
Vicki consumes meatloaf and pizza. To keep her utility constant, you must give her
more of one good if you take some of the other away. This information implies that
a. Vicki’s marginal rate of substitution must be constant along her indifference curve.
b. Vicki’s indifference curve must have a negative slope.
c. the prices Vicki must pay for meatloaf and pizza are always the same.
d. Vicki’s marginal utility from each good must be constant along her indifference
curve.
Capital is appropriately classified as a
a. flow.
b. process.
c. stock.
d. growth rate.
How does the United States compare to other advanced, industrialized economies on
the issue of openness?
a. It is completely closed.
b. It is one of the less open of them.
c. It is about average in openness.
d. It is one of the more open of them.
e. It is the most open of them.
Workers in high-wage countries cannot improve their real income when they trade with
low-wage countries.
a. True
b. False
Table 5-1B
If a graph of Robinson’s marginal utility were constructed from Table 5-1B, it would
a. illustrate the “law” of diminishing marginal utility.
b. be a negatively sloped curve.
c. illustrate a typical consumer’s satisfaction derived from consumption of consecutive
units of a good.
d. All of the above are correct.
One indication that an industry might be oligopolistic is that prices change
a. infrequently.
b. frequently.
c. in rhythmic patterns.
d. on a regular, periodic basis.
Figure 7-7
In Figure 7-7 at 100 units, FC equals
a. 1,000.
b. 1,800.
c. 800.
d. 80.
The last two decades in the United States have seen
a. a fall in real wages.
b. an increase in labor-force participation.
c. growth in service sector employment.
d. All of the above are correct.
The demand for labor is derived from the
a. demand for leisure.
b. supply of labor.
c. demand for final-output goods.
d. supply of final-output goods.
Compensating wage differentials explain some income differences.
a. True
b. False