1) Which of the following allows you to provide information about the relationship
between two variables?
a.coordinate system.
b.pie chart
c.bar graph
d.time-series graph
2) Figure 21-9
Refer to Figure 21-9. If the consumer has $600 in income, what is the price of good X?
a. $20
b.$6
c.$3
d. $0.33
3) Even with market power, monopolists cannot achieve any level of profit they desire
because they will sell lower quantities at higher prices.
a.True
b.False
4) Figure 19-5
Refer to Figure 19-5. Given demand for labor, D1, and supply of labor, S2, what is the
surplus of labor if a minimum wage of $8 per hour is imposed on this market?
a.100
b.200
c.300
d.400
5) In a perfectly competitive market, the horizontal sum of all the individual firms‘
supply curves is
a.zero.
b.equal to the industry profits.
c.the market supply curve.
d.a horizontal line.
6) An advantage of a consumption tax is that it does not distort the incentive to save.
a.True
b.False
7) Regulation of a firm in a monopolistically competitive market
a.usually implies a very small administrative burden.
b.will lower the firm’s costs.
c.is commonly used to enhance market efficiency.
d.is unlikely to improve market efficiency.
8) The marginal seller is the seller
a.for whom the marginal cost of producing one more unit of output is the lowest among
all sellers, and the marginal buyer is the buyer for whom the marginal benefit of one
more unit of the good is the highest among all buyers.
b.who supplies the smallest quantity of the good among all sellers, and the marginal
buyer is the buyer who demands the smallest quantity of the good among all buyers.
c.who would leave the market first if the price were any lower, and the marginal buyer
is the buyer who would leave the market first if the price were any higher.
d.who has the largest producer surplus, and the marginal buyer is the buyer who has the
largest consumer surplus.
9) The graph below pertains to the supply of paper to colleges and universities.
All else equal, an increase in the price of the pulp
used in the paper production process would cause a move from
a.x to y.
b.y to x.
c.SA to SB.
d.SB to SA.
10) When a variable that is named on an axis of a graph changes, the curve shifts.
a.True
b.False
11) In the circular-flow diagram,
a.profit flows from households to firms.
b.labor flows from households to firms.
c.services flow from households to firms.
d.All of the above are correct.
12) Table 18-10
Refer to Table 18-10. This table describes the number of baseballs a manufacturer can
produce per day with different quantities of labor. Each baseball sells for $2.50 in a
competitive market and the firm pays each unit of labor a wage equal to $225 per day.
How many units of labor should the firm hire to maximize profit?
a.2 units
b.3 units
c.4 units
d.5 units
13) If the United Kingdom imports tea cups from other countries, then U.K. producers
of tea cups are better off, and U.K. consumers of tea cups are worse off, as a result of
trade.
a.True
b.False