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1) Federal food distribution programs such as the food stamp program represent efforts
to:
A.Increase supplies of agricultural commodities
B.Increase demand for agricultural commodities
C.Decrease the value of farming to the nation
D.Facilitate the movement of people from farms to cities
2) Near an ocean beach, a high-rise building is being constructed that will block the
scenic view of the ocean by the residents of a low-rise building. The Coase theorem
suggests that this type of dispute between the owners of high-rise and low-rise
buildings:
A.Can be resolved by the owners themselves through individual bargaining
B.Has to be resolved by city government officials
C.Can only be resolved by a zoning ordinance restricting high-rise buildings
D.Should be resolved by a government fine for the builder of the high-rise
3) Other things equal, the interest rate on a loan will be larger:
A.The higher the risk involved
B.The larger the amount of the loan
C.The shorter the length of the loan
D.If loan interest is exempt from taxation
4) Which of the following has been a significant factor in the ability of iPads to
compete effectively against laptop and desktop computers?
A.iPads are often superior to laptop and desktop computers in their ability to create
content.
B.A scarcity of production capacity has curtailed the manufacture of laptop and desktop
computers.
C.Many consumers perceive that iPads are superior to laptops and desktop computers
for the consumption of digital media.
D.The prices of laptops and desktop computers have increased dramatically.
5) Use the graph to answer these questions for a pure monopolist: (a) What price should
the monopolist charge to maximize revenue? (b) What is the elastic and inelastic
portion of the demand curve?
6) Which of the following would not be emphasized in a capitalist economy?
A.Private ownership of capital and other resources
B.Competition and decentralized decisions
C.Reliance on market forces to coordinate economic activity
D.Prevention of owners of capital from exposing this resource to risk
7) The public interest theory of regulation:
A.Says that industries should be regulated to insure quality service at reasonable prices
B.Says higher costs may not be passed through to consumers
C.Protects industries from new competition
D.Guarantees higher rates for natural monopolies
8) The World Bank seeks to:
A.Provide financial backing for the work of the International Monetary Fund
B.Maintain stable exchange rates in the currencies of developing countries
C.Assist developing countries in achieving economic growth
D.Maximize its profits for its worldwide shareholders
9)
Refer to the diagram where xy is the relevant budget line and I1, I2, and I3 are
indifference curves. If the consumer is initially at point L, he or she should:
A.strive for point N by obtaining a larger money income.
B.purchase more of X and less of Y.
C.remain at that point to maximize utility.
D.purchase more of Y and less of X.
10) Oligopolistic firms engage in collusion to:
A.minimize unit costs of production.
B.realize allocative efficiency, that is, the P = MC level of output.
C.earn greater profits.
D.increase production.
