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1) "Time inconsistency" refers to the:
A.tendency for policies with high short-run benefits to have high long-run costs.
B.fallacy that what is true for the short run must be true for the long run.
C.tendency to regularly misjudge in the present what you will do in the future.
D.tendency to misjudge how long it will take to accomplish a future task.
2)
Consider the demand curve above. If the price is A, then the total revenues of sellers
would be the area:
A.DABE
B.0ABC
C.0DEF
D.CBEF
3)
An examination of the quintile distribution of before-tax household income data for
1970 and 2008 given in the table above suggests a trend of:
A.A greater equality in the distribution of income over the period
B.A greater inequality in the distribution of income over the period
C.Rising income levels for the upper-income groups
D.Falling income levels for the lower-income groups
4) The schedule shows various interest rates, the associated quantity demanded of
loanable funds, and the quantity supplied of loanable funds in billions of dollars at those
interest rates.
Refer to the above table and information. If technology improved and the demand for
loanable funds increases by $140 billion at each interest rate, the new equilibrium
interest rate will be:
A.2 percent
B.4 percent
C.8 percent
D.10 percent
5)
Refer to the above graphs. (Assume that the pre-migration labor force in Country A is 0d
and that it is 0u in country B.) If business income is total output minus total labor cost,
then business income in country B after emigration occurs:
A.Increases by area vqsw
B.Increases by area qsr
C.Decreases by area qsr
D.Decreases by area vqsw
6) Which of the following would cause the present optimal extraction level of a
nonrenewable resource to fall?
A.A reduction in extraction costs.
B.A reduction in user costs.
C.A reduction in total costs.
D.A reduction in the price of the resource.
7)
Refer to the above graph of a hypothetical market for health care. Assume that health
insurance pays four-fifths the cost of health care. The consumer will end up consuming
how many units of health care and pay (out-of-pocket) how much of it per unit?
A.600 units, for $20 per unit
B.450 units, for $40 per unit
C.300 units, for $60 per unit
D.450 units, for $80 per unit
8) Government in a market system can increase economic efficiency by collecting taxes
in order to subsidize the production of:
A.Goods with negative externalities
B.Goods with positive externalities
C.Private sector goods
D.Complementary goods
9) Macroeconomics approaches the study of economics from the viewpoint of:
A.the entire economy.
B.governmental units.
C.the operation of specific product and resource markets.
D.individual firms.
10)
Which of the following is an explicit cost of migration?
A.Wages a worker gives up when they leave their home country
B.Adapting to a new culture
C.Paying application fees
D.The stress of looking for a job in a new country
11) Imagine that a state government is considering the construction of a new state office
building to consolidate state operations. Its estimate of the total costs and the total
benefits of building a 4- 6-, 8-, or 10-story building is shown in the table below. (All
figures are in millions of dollars.)
(a)Compute the marginal cost and the marginal benefit of the 4-, 6-, 8-, and 10-story
buildings.
(b)Should the state build a new office building? If so, what size building and what will
be the total benefit, total cost, and net benefit to society?
12) Use the graph provided below to answer the following questions.
(a) Draw the demand and supply curve for college football tickets at University XYZ.
(b) Suppose the football team has a significant winning streak, increasing fans
preference to watch the game at the stadium. Depict the change to the market.
Show/Discuss changes to the equilibrium price and quantity.
(c) Assume the University has decided to make a one-time expansion to the stadium,
adding 500 seats. On a new graph show how this will change the equilibrium price and
quantity.
13)
Refer to the graph above. What is the profit-maximizing level of output for this pure
monopolist?
A.A
B.B
C.C
D.D
14) The burden of Medicaid costs are:
A.The sole responsibility of states
B.The sole responsibility of the Federal government
C.Shared by the states and Federal government
D.Shared by the states and the individual receiving the benefits
