1) The principal objective of industrial regulation is to:
A.Increase product safety
B.Promote improvements in the quality of life
C.Protect the consuming public from the market power of natural monopolies
D.Solve problems associated with industry such as the problems of water and air
pollution
2) The vicious circle of poverty in the poorest DVCs can also be expressed as:
A.The rich get richer while the poor get poorer
B.Fate dealt the poor nations a bad hand
C.The poor nations stay poor because they are poor
D.Historical developments have oppressed the poor nations’ incomes
3) A labor market application of the legal cartel theory of regulation would be:
A.Unemployment benefits
B.The Full Employment Act
C.Equal Employment Opportunities provisions
D.Occupational licensing
4)
The graph above shows part of a consumer’s indifference map for units of coffee and
tea, where I1 and I2 represent indifference curves. Which of the following statements is
correct?
A.The consumer prefers E to F
B.The consumer prefers C to A
C.The consumer likes B and D equally well
D.The consumer likes D better than E
5) Other things equal, an increase in a consumer’s money income:
A.increases the amount of utility a consumer receives from a given quantity of a good.
B.shifts the individual’s budget line rightward because she can now purchase more of
both products.
C.eliminates the individual’s economizing problem.
D.causes the consumer to choose a different combination of goods along a given budget
line.
6) The following data represent a personal income tax schedule. Answer the question on
the basis of this information.
Refer to the above table. If income increases from $15,000 to $30,000, the marginal tax
rate is:
A.10.0 percent
B.13.3 percent
C.18.3 percent
D.26.6 percent
7)
Consider the demand curve above. If area 0ABC is smaller than area 0DEF, we may
conclude that demand in this range is:
A.Price-inelastic
B.Income-inelastic
C.Price-elastic
D.Income-elastic
8) A mining company’s extraction costs curve is:
A.Upward-sloping because the more the company extracts, its marginal extraction costs
increases
B.Upward-sloping because the more the company extracts, its marginal extraction costs
decreases
C.Downward-sloping because the more the company extracts, its marginal extraction
costs increases
D.Downward-sloping because the more the company extracts, its marginal extraction
costs decreases
9) Suppose many businesses want to increase their stock of capital goods and decide to
borrow funds to do it. Which would be the likely result of this event?
A.Interest rates would increase
B.Interest rates would decrease
C.The equilibrium quantity of loanable funds would decrease
D.The equilibrium quantity of loanable funds would remain unchanged
10) Some economists advocate taxes on land because such taxes:
A.do not affect the supply of land.
B.increase the supply of land.
C.improve the allocation of land by shifting it from low-productivity to
high-productivity uses.
D.have a positive incentive function.