1)
Refer to the diagram and assume a single good. If the price of the good decreases from
$6.30 to $5.70, consumer expenditure would:
A.decrease if demand were D1 only.
B.decrease if demand were D2 only.
C.decrease if demand were either D1 or D2.
D.increase if demand were either D1 or D2.
2) Answer the question on the basis of the following demand and cost data for a specific
firm:
Refer to the data. If columns (1) and (3) of the demand data shown are this firm’s
demand schedule, economic profit will be:
A.$10.
B.$19.
C.$6.
D.$8.
3) The table below shows the quantity of gold bars (Qb) in thousands, the extraction
cost for each thousand bars (in millions of dollars), and user cost of each thousand bars
(in millions of dollars) facing the OZ Mining Company this year.
Refer to the data. Suppose that a new government regulation is going to shut down OZ’s
mining operation one year from now. If the current price per bar of gold is $25,000,
how many bars (in thousands) should OZ extract and sell this year?
A.3
B.4
C.5
D.As many as possible.
4) Under pure competition the market price of an output is $3. The output schedule of a
firm using input X is listed in the table below. If the price of input X is $12, how many
units of input X will the firm employ to maximize profits?
A.4
B.5
C.7
D.9
5) If a firm develops better methods of producing a product, then this process
innovation can be expected to result in a(n):
A.Upward shift in both the total product and average cost curves
B.Downward shift in both the total product and average cost curves
C.Downward shift in the total product curve and an upward shift in the average cost
curve
D.Upward shift in the total product curve and a downward shift in the average cost
curve
6)
Refer to the above graph of a hypothetical market for health care. What would be the
difference between the marginal cost and the marginal benefit of health care when the
450th unit is consumed?
A.$10
B.$20
C.$40
D.$60
7) Answer the question using the following table. Figures are in billions of dollars.
Refer to the above table. The equilibrium interest rate and quantity of loanable funds
demanded and supplied in this market will be:
A.8 percent and $140 billion
B.10 percent and $140 billion
C.12 percent and $180 billion
D.14 percent and $240 billion
8) Harvey quit his job at State University where he earned $45,000 a year. He figures
his entrepreneurial talent or foregone entrepreneurial income to be $5,000 a year. To
start the business, he cashed in $100,000 in bonds that earned 10 percent interest
annually to buy a software company, Extreme Gaming. In the first year, the firm sold
11,000 units of software at $75 for each unit. Of the $75 per unit, $55 goes for the costs
of production, packaging, marketing, employee wages and benefits, and rent on a
building.
Refer to the above information. The total revenues of Harvey’s firm in the first year
were:
A.$50,000
B.$100,000
C.$605,000
D.$825,000
9) The market demand curve for a public good:
A.Is derived in the same manner as demand curves for private goods
B.Is derived by horizontally summing all individual demand curves
C.Shows the total value that all individuals place on each additional unit of the good
D.Shows the total number of units that would be produced by the public sector at each
possible price
10)
Refer to the above figure. If box A represents households, B the product market, and C
businesses, then flow (2) and flow (4) would represent:
A.Resources
B.Goods and services
C.Revenues
D.Money incomes
11) A patent is the legal right granted to a firm that allows it to:
A.Make copies of other firm’s products
B.Be the sole buyer of a particular product or resource
C.Sell its new product exclusively for a set number of years
D.Be the exclusive distributor of a particular imported product
12)
Refer to the above graphs. If union workers decide to take more leisure, while the prices
of the products produced by union workers increase, this situation is depicted in graph:
A.A
B.B
C.C
D.D
13) Assume that a VER (voluntary export restraint) is imposed on an imported product.
The difference between the domestic price and the world price is captured by:
A.The government
B.Foreign exporters
C.Domestic consumers
D.Domestic workers
14) Which of the following statements is most accurate about human brain modularity?
A.System 1 uses heuristics, system 2 is more calculating, and both are equally
important in decision making.
B.Both systems regularly use both heuristics and conscious calculations, and both are
equally important in decision making.
C.System 1 uses heuristics, system 2 is more calculating, and system 2 regularly
overcomes system 1’s heuristics to make decisions.
D.System 1 uses heuristics, system 2 is more calculating, and most decisions are made
by system 1.
15) As applied to gender discrimination, the crowding model of occupational
segregation:
A.helps explain why women earn more than men.
B.predicts that men’s wages would fall and women’s wages would rise if occupational
segregation was eliminated.
C.predicts that domestic output would decline if occupational segregation was ended.
D.predicts that competition will eventually totally end discrimination.
16) Nation A pays lower wages to workers than Nation B. Nation A also uses fewer
capital goods per worker than Nation B. This suggests that gains from trade are likely to
result if:
A.Nation A produces products that are more capital-intensive and exports them to
Nation B in return for products from Nation B that are more labor-intensive
B.Nation A produces products that are more labor-intensive and exports them to Nation
B in return for products from Nation B that are more capital-intensive
C.Nation B produces products that are more labor-intensive and exports them to Nation
A in return for products from Nation A that are more capital -intensive
D.Nations A and B each produce capital-intensive and labor-intensive goods and trade
them with each other
17) As the area between the Lorenz curve and diagonal gets larger, the Gini ratio:
A.Rises to reflect greater equality
B.Rises to reflect greater inequality
C.Falls to reflect greater inequality
D.Falls to reflect greater equality
18)
Refer to the above graph showing the revenue curves for a monopolist. Total revenue
will be greatest at what output level?
A.Q1
B.Q2
C.Q3
D.Q4