1) As it relates to international trade, dumping:
A.is a form of price discrimination illegal under U.S. antitrust laws.
B.is the practice of selling goods in a foreign market at less than cost.
C.constitutes a general case for permanent tariffs.
D.is defined as selling more goods than allowed by an import quota.
2) a number of european nations have agreed to use the ___________ as a common
currency:
a.mark
b.pound
c.euro
d.continental
3) in the treatment of u.s. exports and imports, national income accountants:
a.subtract exports, but add imports, in calculating gdp.
b.subtract both exports and imports in calculating gdp.
c.add both exports and imports in calculating gdp.
d.add exports, but subtract imports, in calculating gdp.
4) Which of the following is a tenet of supply-side economics?
A.High marginal tax rates severely discourage work, saving, and investment.
B.Increases in social security taxes and other business taxes shift the aggregate supply
curve to the right.
C.The Federal Reserve should adhere to a monetary rule that limits increases in the
money supply to a 5 percent annual rate.
D.Transfer payments increase incentives to work.
5) refer to the above diagram. at the profit-maximizing output, total variable cost is
equal to:
a.0ahe
b.0cfe
c.0bge
d.abgh
6) In recent years the Fed has communicated changes in its monetary policy by
announcing changes in its policy targets for the:
A.growth of the money supply.
B.Federal funds rate.
C.prime interest rate.
D.U.S. dollar-foreign currency exchange rate.
7) the following table applies to a purely competitive industry composed of 100
identical firms.
refer to the above table. for each of the 100 firms in this industry, marginal revenue and
total revenue will be:
a.$4 and $400, respectively.
b.$3 and $30,000, respectively.
c.$4 and $20,000, respectively.
d.$3 and $18,000, respectively.
8) an antidrug policy which reduces the supply of heroin might:
a.increase street crime because the addict’s demand for heroin is highly inelastic.
b.reduce street crime because the addict’s demand for heroin is highly elastic.
c.reduce street crime because the addict’s demand for heroin is highly inelastic.
d.increase street crime because the addict’s demand for heroin is highly elastic.
9) Use this aggregate demandaggregate supply schedule for a hypothetical economy to
answer the following questions.
(a)What will be the equilibrium price level and quantity of real domestic output?
(b)If the quantity of real domestic output demanded increased by $2000 at each price
level, what will be the new equilibrium price level and quantity of real domestic output?
(c)Using the original data from the table, if the quantity of real domestic output
demanded increased by $5000 and the quantity of real domestic output supplied
increased by $1000 at each price level, what would the new equilibrium price level and
quantity of real domestic output be?
10) In recent years, the Federal Reserve has:
A.paid closer attention to M1 than M2 in setting monetary targets.
B.relied more on changes in the discount rate than open-market operations in
establishing monetary policy.
C.has increased M2 at a fixed annual rate, regardless of the health of the economy.
D.taken an activist, pragmatic approach to monetary policy, paying close attention to
interest rates.
11) suppose industry a is realizing substantial economic profit. which of the following
best describes what will happen in this competitive market?
a.firms will leave the industry and output will fall.
b.firms will enter the industry and output will fall.
c.firms will leave the industry and output will rise.
d.firms will enter the industry and output will rise.
12)
refer to the above diagram. if society is currently producing the combination of bicycles
and computers shown by point d, the production of 2 more units of bicycles:
a.cannot be achieved because resources are fully employed.
b.will cost 1 unit of computers.
c.will cost 2 units of computers.
d.will cause some resources to become unemployed.
13)
Refer to the above data. If the amount of real output demanded at each price level falls
by $200, this might have been caused by:
A.an increase in net exports.
B.a worsening of business expectations.
C.an increase in consumer wealth.
D.a decrease in the personal income tax.
14) the demand for commodity x is represented by the equation p = 100 – 2q and supply
by the equation p = 10 + 4q.
refer to the above information. if demand changed from p = 100 – 2q to p = 130 – q, we
can conclude that:
a.demand has increased.
b.demand has decreased.
c.supply has increased.
d.supply has decreased.