1) For a monopolist, when the output effect is greater than the price effect, marginal
revenue is
a.positive.
b.negative.
c.zero.
d.maximized.
2) The table below shows the marginal tax rates for an unmarried taxpayer for various
levels of taxable income.
Refer to Table 12-6. For this tax schedule, what is the total tax liability for an
individual with $280,000 in taxable income?
a. $105,700
b. $108,900
c. $111,600
d. $117,300
3) A family on a trip budgets $1,000 for meals and gasoline. If the price of a meal for
the family is $50 and if gasoline costs $3.50 per gallon, then how many meals can the
family buy if they buy 100 gallons of gasoline?
a.13
b.16
c.19
d.21
4) Table 14-15
What is the lowest price at which this firm would operate in the short run?
a. $3.
b.$4.
c.$5.
d.$6.
5) Chile’s Production Possibilities FrontierColombia’s Production Possibilities
Frontier
If
the production possibilities frontiers shown are each for one day of production, then
which of the following combinations of coffee and soybeans could Chile and Colombia
together make in a given day?
a.4 pounds of coffee and 16 pounds of soybeans
b.8 pounds of coffee and 15 pounds of soybeans
c.16 pounds of coffee and 10 pounds of soybeans
d.24 pounds of coffee and 4 pounds of soybeans
6) The human-capital theory explanation for why people invest in education has been
challenged by a theory that suggests
a.schooling acts only as a signal of ability.
b.humans cannot be considered “capital.”
c.productivity is not linked to wages.
d.ability, effort, and chance matter more.
7) Which of the following is not a characteristic of a perfectly competitive market?
a.Firms are price takers.
b.Firms have difficulty entering the market.
c.There are many sellers in the market.
d.Goods offered for sale are largely the same.
8) John is planning ahead for retirement in a two-period world. When John is young he
will earn $1 million, and when John is old and retired he will be given $50,000 from
Social Security. If the interest rate between the two time periods is 7 percent, what is the
slope of John’s budget constraint when considering the consumption possibilities
between the two periods if consumption when young is graphed on the horizontal axis
and consumption when old is graphed on the vertical axis?
a. -0.89
b. -1.05
c. -1.07
d. -1.12
9)
Production is
a.possible at points V, W, Y, and Z, but efficient only at points V, W, and Z.
b.possible at points V, W, Y, and Z, but efficient only at point Y.
c.possible at points U, V, W, and Z, but efficient only at points V, W, and Z.
d.possible at points U, V, W, and Z, but efficient only at point U.
10) Over the past 50 years, the U.S. poverty rate was at its lowest level in
a.1973
b.1980
c.1990
d.2008
11) Table 7-4
The numbers in Table 7-1 reveal the maximum willingness to pay for a ticket to a
Chicago Cubs vs. St. Louis Cardinal’s baseball game at Wrigley Field.
If you have two (essentially) identical tickets that you sell to the group in an auction,
what will be the selling price for each ticket?
a. $21
b. $26
c. $51
d. $61
12) Even economists who advocate small government agree that
a.national defense is a public good and that the government should provide it.
b.national defense is a common resource and that the government should provide it.
c.national defense is a public good, but many of them believe that it should be provided
by private firms rather than by the government.
d.national defense is a common resource, but many of them believe that it should be
provided by private firms rather than by the government.
13) The normal life cycle pattern of income
a.contributes to more inequality in the distribution of annual income and to more
inequality in living standards.
b.contributes to more inequality in the distribution of annual income, but it does not
necessarily contribute to more inequality in living standards.
c.contributes to less inequality in the distribution of annual income and to less
inequality in living standards.
d.has no effect on either the distribution of annual income or on living standards.
14) Figure 21-4
In each case, the budget constraint moves from BC-1 to BC-2.
Refer to Figure 21-4. Which of the graphs in the figure could reflect a simultaneous
increase in the price of good X and decrease in the price of good Y?
a.graph a
b.graph b
c.graph c
d.graph d