All of the following questions or statements regarding medical school are positive
except:
A) How do changes in expected future incomes affect the decisions of medical students
about which specialty to choose?
B) Medical students who enter specialized fields make a larger contribution to society
than do student who enter primary care.
C) What role does tuition play in a student’s decision about whether to attend medical
school?
D) Have tuition increases had a large effect or a small effect on the number of
applications to medical school?
Figure 3-1
A decrease in the price of a complementary good would be represented by a movement
from
A) A to B.
B) B to A.
C) D1 to D2.
D) D2 to D1.
Which of the following would increase the unemployment rate?
A) a law making it illegal to work more than 35 hours per week
B) a cut in unemployment compensation
C) an increase in unemployment insurance payments
D) a decrease in the minimum wage
Table 16-2
Neem Products sells its Ayurvedic Neem toothpaste in two completely isolated markets
with demand schedules as shown in Table 16-2. The average cost of production is
constant at $2 per tube.
How many tubes of toothpaste will Neem sell in West Fall and at what price?
A) Q = 2 units; P = $4.50
B) Q = 3 units; P = $4
C) Q = 4 units; P = $3.50
D) Q = 5 units; P = $3
Table 1-4
Eva runs a small bakery in the village of Roggerli. She is debating whether she should
extend her hours of operation. Eva figures that her sales revenue will depend on the
number of hours the bakery is open as shown in the table above. She would have to hire
a worker for those hours at a wage rate of $12 per hour.. What is Eva’s marginal cost if
she decides to stay open for two hours instead of one hour?
A) $12
B) $24
C) $36
D) $71
Figure 12-1
According to the figure above, at what point is aggregate expenditure less than GDP?
A) J
B) K
C) L
D) none of the above
Figure 3-7
Assume that the graphs in this figure represent the demand and supply curves for
Fruitopia, a soft drink. Which panel describes what happens in the market for Fruitopia
when the price of Snapple, a substitute product, decreases?
A) Panel (a)
B) Panel (b)
C) Panel (c)
D) Panel (d)
Proponents of the new classical macroeconomics do not believe which of the
following?
A) Expansionary monetary policy can be an effective policy tool.
B) Workers and firms use information contained in Fed policy to form inflation
expectations.
C) Wages and prices will adjust rapidly in the economy.
D) The economy will normally be at its potential level.
Shondra’s real wage in 2014 is $18.50. If the price level is 106, what is Shondra’s
nominal wage?
A) $19.61
B) $18.61
C) $18.50
D) $17.44
Figure 3-8
The graph in this figure illustrates an initial competitive equilibrium in the market for
apples at the intersection of D2 and S1 (point C). Which of the following changes would
cause the equilibrium to change to point B?
A) A positive change in the technology used to produce apples and decrease in the price
of oranges, a substitute for apples.
B) An increase in the wages of apple workers and an increase in the price of oranges, a
substitute for apples.
C) An increase in the number of apple producers and a decrease in the number of apple
trees as a result of disease.
D) A decrease in the wages of apple workers and an increase in the price of oranges, a
substitute for apples.
If the 15th unit of output has a marginal cost of $29.50 and the average cost of
producing 14 units of output is $30.23, what will happen to the average cost of
production if the 15th unit is produced?
A) Average cost increases as more is produced.
B) Average cost will fall.
C) Average cost could increase or decrease depending on what happens to variable cost.
D) Average cost could increase or decrease depending on what happens to fixed cost.
If aggregate demand just increased, which of the following may have caused the
increase?
A) an increase in government purchases
B) an increase in the interest rate
C) an increase in the price level
D) an increase in imports
What is potential GDP?
A) It is the level of real GDP in the long run.
B) It is the difference between current GDP and maximum GDP.
C) It is the level of real GDP in the short run.
D) It is the level of GDP at which inflation is constant.