1) In competitive markets, a surplus or shortage will:
A.Never exist because the markets are always at equilibrium
B.Cause changes in the quantities demanded and supplied that tend to eliminate the
surplus or shortage
C.Cause shifts in the demand and supply curves that tend to eliminate the surplus or
shortage
D.Cause changes in the quantities demanded and supplied that tend to intensify the
surplus or shortage
2) Which of the following is not considered by economists to be an economic resource?
A.Money.
B.Factory workers.
C.Computers at a retail store.
D.A forest.
3)
Refer to the above graph of the supply and demand for agricultural products. The
supply and demand for agricultural products are in initial equilibrium at point 1.
Technological progress in agriculture will:
A.Shift D1 to D2 and cause farm incomes to fall
B.Shift S1 to S2 and cause farm incomes to fall
C.Change equilibrium from point 1 to point 2 and cause farm incomes to rise
D.Change equilibrium from point 1 to point 6 and cause farm incomes to fall
4) The amount of capital used per farmworker increased by how much from 1930 to
1980?
A.Double
B.Fivefold
C.Tenfold
D.Fifteen-fold
5) According to the law of diminishing marginal returns:
A.Output will fall and then rise as additional units of input are employed
B.Employing additional inputs will diminish total output
C.The additional output generated by additional units of an input will diminish
D.The additional inputs necessary to produce an additional unit of output will diminish
6) The restaurant, legal assistance, and clothing industries are each illustrations of:
A.countervailing power.
B.homogeneous oligopoly.
C.monopolistic competition.
D.pure monopoly.
7) Evidence of a chronic balance of payments deficit is:
A.a decline in amount of the nation’s currency held by other nations.
B.an excess of exports over imports.
C.diminishing reserves of foreign currencies.
D.an increase in the international value of the nation’s currency.
8) With specialization in a market economy, individual:
A.Firms produce a wide range of products
B.Producers consume little or none of the products they produce
C.Producers consume most of the output that they produce
D.Consumers have to produce most of what they consume
9) Approximately how many workers are employed in the U.S. health care industry?
A.850,000
B.925,000
C.5.8 million
D.17 million
10) If the production possibilities curve is a straight line, then:
A.The opportunity cost of producing one good is zero
B.The law of increasing opportunity costs does not apply
C.The society can produce more of both goods simultaneously
D.The society is capable of producing only one of the goods and not the other
11)
Refer to the diagram. The initial demand for and supply of pesos are shown by D1 and
S1. Suppose the United States reduces its imports of Mexican goods, shifting its
demand for pesos from D1 to D2. If the United States was operating under a system of
exchange controls, the U.S. government would:
A.find that, at the controlled exchange rate, pesos would be in surplus.
B.be faced with deteriorating terms of trade.
C.be faced with the problem of rationing BG pesos to U.S. importers, who want BF
pesos.
D.be faced with the problem of rationing BF pesos to U.S. importers, who want BG
pesos.
12) Which of the following is correct?
A.There is no firm mathematical relationship between marginal utility and total utility.
B.Total utility is equal to the change in marginal utility from consuming an additional
unit of a product.
C.If marginal utility is diminishing and is a positive amount, total utility will increase.
D.If marginal utility is diminishing, total utility must also be diminishing.
13) To be classified as a low-income developing country, annual per capita income in
2010 needed to be:
A.$1,005 or less.
B.$580 or less.
C.$3,723 or less.
D.$925 or less.
14) Those who contend that oligopolists are less likely than more competitive firms to
engage in R&D say that:
A.oligopolists have little incentive to introduce costly new technology and produce new
products when they currently are earning large economic profit using existing
technology and selling existing products.
B.the undistributed profits of oligopolists give them a source of readily available,
relatively low-cost funds for financing R&D.
C.entry barriers enable oligopolists to sustain the profits they gain from innovation.
D.the large size of oligopolists’ R&D departments allows them to use very specialized,
expensive R&D equipment and employ teams of specialized researchers.
15) Which of the following statements is not correct?
A.An increase in a nation’s labor supply will cause its potential output to increase
B.Economic growth can be illustrated by an expansion of a nation’s production
possibilities curve
C.An increase in the quantity of a nation’s resources will cause economic growth, but an
increase in the quality of resources will not
D.New technologies or new ways of producing output can cause a nation’s production
possibilities curve to shift outwards
16) The government would be running a budget surplus if:
A.Government spending is lower than consumer spending
B.Tax revenues are less than government spending
C.It imports less from abroad than it exports
D.Government spends less than it collects in taxes
17)
At equilibrium, the profit-maximizing monopolist facing the situation shown in the
graph will face a negative:
A.Average revenue
B.Total revenue
C.Marginal revenue
D.Profit
18) The equilibrium point in the market is where S and D curve intersect.
Refer to the graph above. At equilibrium, the total revenues received by sellers would
be represented by the area:
A.b
B.b + c
C.a + b
D.b + c + d
19) Which of the following is considered an economic resource?
A.The ice cream that kids buy at the ice cream parlor
B.The HD-TV sets in people’s homes
C.The land that is designated as national parks by the government
D.shoppers buying stuff at the mall