The government proposes a tax on halogen light bulbs. Sellers will bear the entire
burden of the tax if the
A) supply curve of halogen bulbs is horizontal.
B) demand curve for halogen bulbs is vertical.
C) demand curve for halogen bulbs is horizontal.
D) demand curve is downward sloping and the supply curve is upward sloping.
If the Federal Reserve targets the money supply, and the money demand curve shifts to
the left, then the Fed
A) cannot maintain the money supply target.
B) can maintain the money supply target, but at a lower interest rate.
C) can maintain the money supply target, but at a higher interest rate.
D) can maintain the money supply target with no change in the interest rate.
If the demand for iPods is price elastic, then
A) the percentage change in quantity demanded is greater than the percentage change in
price (in absolute value).
B) the percentage change in quantity demanded is less than the percentage change in
price (in absolute value).
C) the percentage change in quantity demanded is equal to the percentage change in
price.
D) quantity demanded is not responsive to changes in price.
In a small Asian country, it is estimated that a $10,000 increase in capital per hour
worked will increase real GDP per hour worked by $600. Based on this information,
what is the slope of the per-worker production function in this range?
A) 0.06
B) 6.6
C) 66.6
D) 666
Suppose your expenses for this term are as follows: tuition: $9,000, room and board:
$1,500, books and other educational supplies: $1,000. Further, during the term, you can
only work part-time and earn $3,000 instead of your full-time salary of $8,000. What is
the opportunity cost of going to college this term, assuming that your room and board
expenses would be the same even if you did not go to college?
A) $10,000
B) $13,000
C) $15,000
D) $18,000
Why are decision trees useful to managers who plan business strategies?
A) Decision trees explain the level of concentration in an industry.
B) Decision trees can be used to increase the amount of product differentiation; this
enables managers to charge higher prices for their products.
C) Decision trees provide a systematic way of thinking through the implications of a
strategy.
D) Using a decision tree always leads to a dominant strategy.
Figure 5-13
Figure 5-13 illustrates the
market for gasoline before and after the government imposes a tax to bring about the
efficient level of gasoline production.
The amount of the gasoline tax is ________ per gallon.
A) $0.75
B) $1.25
C) $1.75
D) $2.00
Scenario 1-1 Suppose a cell phone manufacturer currently sells 20,000 cell phones per
week and makes a profit of $5,000 per week. A manager at the plant observes,
“Although the last 3,000 cell phones we produced and sold increased our revenue by
$6,000 and our costs by $6,700, we are still making an overall profit of $5,000 per
week so I think we’re on the right track. We are producing the optimal number of cell
phones.”
Using marginal analysis terminology, what is another economic term for the
incremental revenue received from the sale of the last 3,000 cell phones?
A) gross earnings
B) marginal revenue
C) sales revenue
D) gross profit
If a country’s currency ________ the dollar, its exchange rate is fixed.
A) is exchanged in currency markets for
B) depreciates against
C) is pegged to
D) has a floating exchange rate value which is equal to
The interest rate that banks charge other banks for overnight loans is the
A) prime rate.
B) discount rate.
C) federal funds rate.
D) Treasury bill rate.