Refer to Exhibit 34-7. The world price of good X is $15. Under a policy of free trade,
the U.S. production ofgood X would be
Exhibit 34-7
a. 10 units.
b. 20 units.
c. 25 units.
d. 50 units.
e. none of the above
Refer to Exhibit 22-11. Average total cost of the sixth unit of output is
Exhibit 22-11
a. $50.
b. $100.
c. $300.
d. $90.83.
Externalities can be internalized through voluntary agreements as long as
a. transaction costs are low relative to expected benefits.
b. transaction costs are high relative to expected benefits.
c. the agreement is a short-run agreement.
d. the agreement is a long-run agreement.
If the coupon payment on a bond is $140 and the coupon rate is 5%, then what is the
price value of the bond?
a. $2,800
b. $147
c. $254.40
d. $5,000
e. There is not enough information provided to answer this question.
The slope of a straight line is always equal to either 1.0 or -1.0.
a. True
b. False
Technological __________ in American agriculture has __________ other types of
employment.
a. improvement; drawn labor away from
b. improvement; released labor to go to
c. stagnation; drawn labor away from
d. stagnation; released labor to go to
Person A argues that government is unnecessary and often does more harm than
good.Economist A disagrees.What does economist A – who believes that there is a
legitimate case that can be made for government – most likely say to support his
position?
a. Government almost always does more good than harm.
b. Without government, life would be anarchy.
c. There are some things that individuals want done that can’t get done without
government.
d. There are better people going into government work than are going into the private
sector.
e. none of the above
The original Dow Jones Industrial Average (DJIA) contained ____________ stocks,
while the DJIA now consists of ____________ stocks.
a. 10; 500
b. 11; 30
c. 15; 50
d. 20; 60
The two white rats in the “buying” behavior study conducted at Texas A & M acted in a
manner that supported the law of demand and the concept of consumer equilibrium.
a. True
b. False
If the government legalizes the purchase and sale of marijuana, the equilibrium quantity
would _________ and the price would ________ if the supply of marijuana increased
by _______ than the demand for marijuana increased as a result of the legalization.
a. rise; rise; more
b. fall; rise; more
c. rise; fall; more
d. rise; rise; less
e. none of the above
Suppose that both the demand for and supply of agricultural products increases.If the
increase in the supply of agricultural products is greater than the increase in demand,
prices of agricultural products
a. increase.
b. decrease.
c. remain the same.
d. may increase, decrease, or remain the same.
Which of the following is not an example of a legal barrier to entry?
a. a beautician’s license
b. a patent
c. exclusive ownership of raw materials
d. a public franchise
e. a copyright
Which of the following was not given as a reason for income differences in the
textbook?
a. luck
b. low minimum wage
c. wage discrimination
d. risk taking
Refer to Exhibit 24-4.What dollar amounts go in blanks (F), (G), (H), (I), and (J),
respectively?
Exhibit 24-4
a. $120; $125; $8; $28; and $38
b. $9; $70; $50; $30; and $10
c. $250; $15; $10; $30; and $50
d. $100; $90; $8; $28; and $48
If the nominal rate of interest is 9 percent and the expected rate of inflation is 6 percent,
then the real rate of interest is
a. 6 percent.
b. 15 percent.
c. 3 percent.
d. 7.5 percent.
In the market for good X there are three buyers, Adam, Bill, and Carolyn. Adam buys 3
units of good X at $4, Bill buys 7 units of good X at $4, and Carolyn buys 8 units of
good X at $4. One point on the market demand curve for good X consists of a price of
_____________ and a quantity demanded of __________________ units.
a. $4; 10
b. $4; 18
c. $4; 15
d. $5; 8
e. none of the above
Which of the following is descriptive of the law of diminishing marginal utility?
a. The third hamburger consumed provides less utility than the second hamburger
consumed.
b. The third hamburger is priced higher than the first hamburger.
c. As price falls, quantity demanded rises, ceteris paribus.
d. The price of a good rises as the costs of producing that good rise.
e. none of the above