1)
refer to the above diagram. the base year used in determining the price indices for this
economy:
a.cannot be determined from the information given.
b.is some year before 2000.
c.is more recent than 2000.
d.is 2000.
2) economists who believe in the permanence of the recent productivity acceleration
say that:
a.the united states is entering an era of high structural unemployment due to rapid
technological change.
b.technological advance creates its own supply, which in turn creates its own demand.
c.innovations in computers and communications, together with global capitalism, are
greatly boosting u.s. productivity and the economy’s potential economic growth rate.
d.technological change will require more central planning and government regulation.
3)
Refer to the diagram above, representing Slippery Slope Oil Company. A $5 decrease in
the user cost would:
A.decrease the optimal quantity extracted in the present.
B.increase the optimal quantity extracted in the present.
C.not affect the optimal quantity extracted in the present.
D.reduce extraction costs in the present.
4) refer to the above data. assuming that the firm is motivated by self-interest and that
the 20 units which can be produced with each technique can be sold for $2 per unit, the
firm will:
a.realize an economic profit of $10
b.realize an economic profit of $4
c.not earn any economic profit
d.close down rather than incur a loss by producing
5) the french term “laissez-faire” means:
a.”there is no free lunch.”
b.”let it be.”
c.”circular flow.”
d.”public ownership.”
6) economic resources are also called:
a.free gifts of nature.
b.consumption goods.
c.units of money capital.
d.factors of production.
7) limited liability applies to:
a.partnerships.
b.proprietorships.
c.all corporations.
d.financial corporations but not to manufacturing corporations.
8) if profits are maximized (or losses minimized), which of the following conditions are
common to both unregulated monopoly and to pure competition?
a.mc = p
b.mc = atc
c.mr = mc
d.p = mr
9) The incidence of a tax pertains to:
A.the degree to which it alters the distribution of income.
B.how easy it is to evade the tax.
C.who actually bears the burden of a tax.
D.the progressiveness or regressiveness of tax rates.
10) Suppose in some economy there are 100 million workers; 8 million of those
workers work in retail trade, and 2 million of the retail workers belong to unions. Total
union membership in this economy is 30 million. The rate of unionization in the
economy is:
A.30 percent and the rate of unionization in retail trade in 20 percent.
B.8 percent and the rate of unionization in retail trade is 2 percent.
C.30 percent and rate of unionization in retail trade is 25 percent.
D.20 percent and rate of unionization in retail trade is 25 percent.
11) answer the next question(s) on the basis of the following data. all figures are in
billions of dollars.
refer to the above data. the gross domestic product is:
a.$326.
b.$282.
c.$307.
d.$300.
12) (Consider This) Changing World Technologies receives a $42 per barrel federal
biofuel subsidy. The purpose of such a subsidy would be to:
A.reduce the demand for biofuel.
B.reduce the supply of biofuel.
C.increase the demand for biofuel.
D.increase the supply of biofuel.
13) Discrimination creates a:
A.redistribution of a larger domestic output.
B.larger domestic output but no redistribution.
C.smaller domestic output but no redistribution.
D.redistribution of a smaller domestic output.
14)
symbols: q = number of workers demanded; w = wage rate; and vtp = value of the
cumulative total product (output) of the particular number of workers.
assumptions: (1) the current wage in zinnia is $20 and the current wage in marigold is
$12; (2) full employment exists in both countries.
refer to the above data, symbols, and assumptions. if migration is costless and
unimpeded, the combined value of total product in the two countries will:
a.decline from $62 to $36.
b.decline from $120 to $70.
c.increase from $36 to $62.
d.increase from $62 to $70.
15) A function of the Federal Trade Commission is to:
A.investigate instances of faulty and misleading advertising.
B.establish railway rates for interstate railroads.
C.ban or recall unsafe consumer products.
D.prevent insider trading in securities markets.
16) Which of the following statements best describes the parity concept?
A.The prices of farm commodities should vary inversely with changes in the
prices-paid index for farmers.
B.Because of productivity increases, farmers are entitled to the same real income for a
smaller volume of output.
C.The money incomes of farmers should always be the same, regardless of increases or
decreases in the prices of the products they buy.
D.The production of a given real output entitles the producer to the same real income
over time.
17) if a regulatory commission wants to establish a socially optimal price for a natural
monopoly, it should select a price:
a.at which the marginal cost curve intersects the demand curve.
b.at which marginal revenue is zero.
c.at which the average total cost curve intersects the demand curve.
d.which corresponds with the equality of marginal cost and marginal revenue.
18) Productive inputs that are actually or virtually fixed in supply are known as:
A.renewable natural resources.
B.natural capital.
C.non-renewable natural resources.
D.alternative fuels.
19)
Refer to the above table representing Darcy’s bank account. Assuming that $1000 was
deposited into her account at the beginning of year 1, and no further deposits or
withdrawals were made, what interest rate is being paid on Darcy’s account?
A.6 percent.
B.6.4 percent.
C.19.1 percent.
D.60 percent.
20) Describe the graph for a long-run supply curve in a decreasing-cost industry. Why
does it have this slope?
21) Why do monopolistically competitive firms spend funds for product differentiation
and advertising when this practice only adds to the firms costs?
22) Explain the Phillips Curve concept and construct an example of the curve on the
below graph.
23) Define GDP and its characteristics.
24) According to the monetarists, what is the main cause of macroeconomic instability?
25) In what cases would the market share held by the dominant firm be or not be an
especially relevant or important factor in determining whether a firm has too much
market power?
26) How does the personal income measure differ from the disposable income measure?
27) Draw a graph on the below diagram showing the long-run equilibrium position of a
competitive firm. Write a formula to express the equalities in the graph.