1) If a firm is employing quantities of resources J and K so that MRPJ/PJ = MRPK/PK
= 1, then:
A.MPJ/PJ may either exceed or be less than MPK/PK.
B.MPJ/PJ will be less than MPK/PK.
C.MPJ/PJ will exceed MPK/PK.
D.MPJ/PJ = MPK/PK.
2)
Refer to the above diagram which relates to Firm A. Which of the following would shift
A’s average total cost curve from ATC1 to ATC2?
A.replacement of old equipment with new, more productive equipment embodying
technological advance
B.a decrease in the incomes of A’s customers
C.a move along A’s total product curve (not shown)
D.the increase in the price of one of the major inputs used to produce A’s product
3) Use the figures in the table below to answer the following questions.
(a)What is the value of M1?
(b)What is the value of M2?
4) A conglomerate merger:
A.can extend the line of products sold, extend the territories in which products are sold,
or combine totally unrelated products.
B.is defined as a merger involving two firms that previously had a buyer-seller
relationship.
C.is defined as a merger involving two firms producing the same or similar products
and selling them in the same geographical market.
D.is illegal, per se.
5) The following consolidated balance sheet of the commercial banking system.
Assume that the reserve requirement is 10 percent. All figures are in billions and each
question should be answered independently of changes specified in any preceding ones.
Refer to the above data. The commercial banking system has excess reserves of:
A.$10 billion.
B.$5 billion.
C.$2 billion.
D.zero.
6)
Refer to the above table. The after-tax MPC in the economy shown is:
A..5.
B..67.
C..75.
D..8.
7) The group that sets the Federal Reserve Systems policy on buying and selling
government securities (bills, notes, and bonds) is the:
A.Federal Deposit Insurance Corporation (FDIC).
B.Federal Bond Sale Authority.
C.Council of Economic Advisers.
D.Federal Open Market Committee (FOMC).
8) Small time deposits, by definition:
A.mature in one month or less.
B.mature in one year or less.
C.are less than $100,000.
D.are held by state and local banks only.
9) national income accountants can avoid multiple counting by:
a.including transfers in their calculations.
b.only counting final goods.
c.counting both intermediate and final goods.
d.only counting intermediate goods.
10)
Refer to the above table. Suppose the legal reserve requirement is 10 percent and
initially there are no excess reserves in the banking system. If the Fed wished to reduce
the interest rate by 1 percentage point, it would:
A.sell $10 of government bonds in the open market.
B.buy $100 of government bonds in the open market.
C.sell $100 of government bonds in the open market.
D.buy $10 of government bonds in the open market.
11) the following cost data for a purely competitive seller:
refer to the above data. given the $75 product price, at its optimal output the firm will:
a.realize a $25 economic profit.
b.realize a $30 economic profit.
c.incur a $25 loss.
d.realize a $30 loss.
12) Economic profit might result from:
A.easy entry into industries.
B.dynamic change and uncertainty.
C.X-inefficiency.
D.a decline in entrepreneurship.