People sometimes act differently in different settings.An economist is likely to explain
this by saying
a. the benefits and costs of certain behaviors can be different in different settings.
b. people are hard to figure out.
c. people behave as others behave.
d. it is hard to figure out what makes people tick.
e. none of the above
Profits may exist as the result of
a. uncertainty.
b. alertness to arbitrage opportunities.
c. innovation.
d. all of the above
e. none of the above
Ultimately, market supply curves are upward sloping because of
a. the law of diminishing marginal returns.
b. economies of scale.
c. average fixed cost falling continually as more output is produced.
d. the law of the short run marginal cost curve.
e. specialization.
Those who say that economics is becoming an increasingly imperialist social science
are suggesting that economics is
a. becoming increasingly concerned with corporations rather than small businesses.
b. becoming increasingly focused on government actions rather than on business
activity.
c. spreading out into other fields of study, such as history, anthropology, and sociology.
d. becoming increasingly focused on business activity rather than on government
actions.
Exhibit 39-9
Under a target price system, with the target price set at P1, the per-unit deficiency
payment will be:
a. P2 – P4.
b. P1 – P3.
c. P2 – P3.
d. P1 – P2.
e. none of the above
Exhibit 2-1
The opportunity cost of moving from point A to B is
a. 10,000 units of butter.
b. 20,000 units of butter.
c. 20,000 units of guns.
d. 10,000 units of guns.
Which of the following statements is false?
a. Government can remove individuals from a prisoner’s dilemma setting and make both
participants better off.
b. Government can define and enforce the property rights that individuals actually want
defined and enforced.
c. Individuals in a prisoner’s dilemma setting may want to get out of the prisoner’s
dilemma setting.
d. none of the above
The law of diminishing marginal utility helps to explain the direct relationship between
price and quantity supplied.
a. True
b. False
Which of the following assumptions do the market structures of monopolistic
competition and perfect competition share?
a. many buyers and sellers
b. homogeneous products
c. difficult entry into the market
d. difficult exit from the market
Which of the following persons is most likely to become informed on the National
Endowment for the Arts?
a. an attorney
b. a mayor of a city
c. a farmer
d. a student of agriculture
e. a sculptor
Two major exports for the United States are
a. clothing and office machines.
b. soybeans and scientific instruments.
c. footwear and fish.
d. coffee and diamonds.
e. none of the above
Exhibit 20-3
If price decreases from $1.50 to $0.50, total revenue along the demand curve
a. increases to $67.50.
b. increases to $87.50.
c. remains at $87.50.
d. decreases to $67.50.
e. decreases to $27.50.
If the demand for a particular agricultural product is highly elastic and bad weather
causes the supply to decrease, then we would expect the price of agricultural products
to
a. decrease and farmers’ revenues to decrease.
b. increase and the demand to decrease.
c. increase while farmers’ revenues decrease significantly.
d. increase by a large percentage while farmers’ revenues decrease only slightly.