1)
Refer to the diagram. At P1, this firm will produce:
A.47 units and break even.
B.47 units and realize an economic profit.
C.66 units and earn only a normal profit.
D.24 units and earn only a normal profit.
2) The market demand schedule or curve for a product shows the relationship between
how much of the product buyers are willing and able to buy and the:
A.Product’s price
B.Buyers’ incomes
C.Cost of producing the product
D.Time period, say, from one month to the next
3) The following graph shows a total revenue curve for a monopolist.
Refer to the above graph. When total revenue declines as output expands, demand is:
A.Elastic
B.Inelastic
C.Perfectly inelastic
D.Perfectly elastic
4) The theory of consumer behavior assumes that consumers attempt to maximize:
A.the difference between total and marginal utility.
B.total utility.
C.average utility.
D.marginal utility.
5) When a U.S. company purchases a factory in Singapore, this will be a:
A.Credit on the current account of the U.S. balance of payments
B.Debit on the current account of the U.S. balance of payments
C.Credit on the financial account of the U.S. balance of payments
D.Debit on the financial account of the U.S. balance of payments
6) Occupational licensing has much the same effect as:
A.inclusive unionism.
B.exclusive unionism.
C.bilateral monopoly.
D.monopsony.
7) Which action taken by a worker would not be an investment in human capital?
A.Enrolling in college
B.Enrolling in trade school
C.Purchasing exercise equipment
D.Purchasing stock in a pharmaceutical company
8) The ultimatum game reveals that the threat of rejection:
A.weakens the functioning of the invisible hand.
B.reduces cooperation.
C.increases selfish behavior.
D.helps align private interests with social interests.
9) Regulation of business, according to the legal cartel theory, stems from:
A.The public wanting protection from potentially capricious firms
B.Economists who see greater efficiency in regulated industries
C.Lawyers whose jobs are more secure in cartels
D.Firms wanting to be regulated in order to shut off competition
10)
Refer to the above graphs. Which graph shows a change in the buyer’s income, but no
changes in the prices of X and Y?
A.Graph A
B.Graph B
C.Graph C
D.Graph D
11)
Suppose Elroy’s budget line is as shown on the diagram. If his tastes change in favor of
Coke and against popcorn, the budget line will:
A.become steeper.
B.become flatter.
C.shift rightward.