If the bid value of a Treasury bond is listed as €112:16€, it means that the buyer is
willing to pay $1,125 for the bond.
a. True
b. False
When productivity increases in the production of agricultural products, the supply curve
for agricultural products shifts rightward.
a. True
b. False
Exhibit 25-10
Suppose that the letter grade earned on a test for each student in a class depends upon
how well he/she does relative to other students in the class.This exhibit shows a
prisoner’s dilemma setting for two representative students in the class, George and
Gina.
If Gina studies for two hours and George studies for four hours, George’s letter grade on
the test will be a ___________ and Gina’s letter grade on the test will be a
__________________.
a. C; A
b. C; C
c. B; B
d. A; C
The more dollars that must be given up to buy one British pound, the __________
American goods are for the British and the __________ American goods the British
will buy; thus __________ dollars will be demanded.
a. more expensive; fewer, more
b. less expensive; more, more
c. more expensive; fewer, fewer
d. less expensive; fewer, more
e. none of the above
In country A the income shares (in percent) received by the lowest fifth of income
groups to the highest fifth of income groups is, respectively, 10, 15, 20, 25, and 30. In
country B the income shares (in percent) received by the lowest fifth of income groups
to the highest fifth of income groups is, respectively, 5, 12, 20, 25 and 38. It follows
that the
a. income distribution is more equal in country B than A.
b. income distribution is less unequal in country B than A.
c. Lorenz curve in country B is nearly the same as the line of perfect income equality in
country A, but not in country B.
d. income distribution is less equal in country B than A.
e. a and b
One unintended consequence of the various attempts to restrict farm acreage was that
a. output generally decreased, price increased, and farmers earned higher incomes.
b. individual farmers intensified their efforts to harvest crops from the land still under
cultivation.
c. farmers’ incomes remained constant in real terms.
d. the land that was set aside became less productive.
With a quota, the __________ is greater than the __________.
a. loss in producers’ surplus; gain in consumers’ surplus
b. loss in consumers’ surplus; loss in producers’ surplus plus higher total revenues on
the imported goods
c. loss in producers’ surplus plus higher total revenues on the imported goods;
consumers’ surplus
d. tax; revenue
e. quota-determined price; quota-determined output
Minerals, animals, water and forests are all considered to be part of the resource
category known as
a. capital
b. entrepreneurship
c. labor
d. land
e. none of the above
According to economists Alchian and Demsetz, firms are formed when
a. the sum of what individuals can produce as a team is greater than the sum of what
individuals can produce working alone.
b. the sum of what individuals can produce working alone is greater than the sum of
what individuals can produce as a team.
c. what each individual can produce as a member of a team is less than what each
individual can produce working alone.
d. the sum of what individuals can produce as a team is equal to the sum of what
individuals can produce working alone.
e. none of the above
The percentage of sales accounted for by X number of firms in the industry is called the
a. concentration ratio.
b. oligopoly rate.
c. interdependence rate.
d. market power index.
A special interest group has a good chance of redistributing (transferring) income from
others to itself if the
a. costs of the transfer are spread over a very large number of people.
b. costs of the transfer are spread over a very small number of people.
c. costs of the transfer are spread over the same number of people that comprise the
special interest group.
d. the number of members in the special interest group is greater than 100.
e. none of the above
Suppose the production of a good results in negative externalities. If output is at the
intersection of the demand curve and the marginal social cost curve, then
a. the socially optimal level of output will be produced.
b. society will incur a net social cost.
c. society will want less output produced, and producers will be willing to satisfy this
desire at a price that society deems acceptable.
d. b and c