Archives: Quiz

Some economists argue that selective withdrawal has caused: a. an increase in the observed average relative wages of those Black men who remain employed. b. White men to leave the labor market if they cannot find a job that offers […]

_______ prohibits sexual discrimination in the workplace. a. The Equal Pay Act of 1963 b. The Civil Rights Act of 1964 c. Executive Order 11246 d. The Civil Rights Act of 1991 e. The Equal Rights Act of 1991 Which […]

Which of the following is an example of labor-market discrimination? a. A man who makes 5 widgets an hour is paid a higher wage than a man who makes 2 widgets an hour. b. Tim and Alexis are equally popular […]

Suppose a competitive labor market is populated by 75% high-ability (H) workers and 25% low-ability (L) workers. Each high-ability worker produces output valued at $100 and each low-ability worker produces output valued at $20. Without job market signaling, the equilibrium […]

If capital and labor are gross substitutes in production, a. then the scale effect dominates. b. then the substitution effect dominates. c. then the scale and substitution effects are of equal magnitude. d. then capital and labor must be used […]

Suppose there is a payroll tax placed on firms. If labor supply is perfectly elastic, then a. firms and workers will split the payroll tax 50″50. b. workers will bear 75% of the tax burden. c. workers will bear 100% […]

If the government decreases the payroll tax, then the equilibrium wage will and the employment level will . a. decrease, decrease b. decrease, increase c. increase, increase d. increase, decrease e. remain the same, decrease A worker’s reservation wage is […]

Adjustment costs: a. are costs incurred by a firm when it has to advertise to hire more workers. b. are costs incurred by a firm when it decides it needs to layoff workers. c. result in less employment volatility. d. […]

A worker will not participate in the labor market when a. the MC of work equal the MB. b. when the MB of work are greater than the MC. c. where . d. where . e. where . A worker’s […]

If a firm makes adjustments to create a safer working environment, then a. workers will demand higher wages. b. workers will accept lower wages. c. the firm will attract more skilled workers. d. the firm is no longer maximizing profits. […]

If wages are below the wage level that causes supply to equal demand, then there is a. excess supply for labor. b. excess demand for labor. c. a market equilibrium. d. unemployment. e. inflation. Which of the following groups are […]

A decrease in an individual’s wealth causes the budget set to experience a. a parallel shift outward. b. a parallel shift inward. c. a no change. d. a pivot upward. e. a pivot downward. Which of the following is NOT […]

Sharon will invest in another year of school if one more year of school costs a. $20 b. $26 c. $30 d. $50 e. all of the above Suppose the labor demand curve shifts downward. Which of the following could […]

The EITC ______ labor force participation and ______ work incentives for current labor market participants. a. encourages; may increase b. encourages; may decrease c. may encourage; increases d. may discourage; decreases e. may discourage; increases Which of the following individuals […]

A production function is a table, a graph, or an equation showing the: a. least-cost method of producing output. b. optimal combination of inputs. c. maximum output that can be achieved from specified levels of inputs. d. combinations of inputs […]

Two local ready-mix cement manufacturers, Here and There, have combined demand given by Q = 105 ” P. Their total costs are given by TCHere = 5QHere + 0.5Q2 Here and TCThere = 5QThere + 0.5Q2 There. If they successfully […]

The demand for costume jewelry has been estimated to be Q = 100P“2E2, where E is the price of real gem jewelry. Costume jewelry and real gem jewelry are: a. substitute goods. b. complement goods. c. inferior goods. d. normal […]

Output elasticity can be defined as the: a. percentage change in output divided by the (equal) percentage change in all inputs. b. change in output divided by the change in all inputs. c. change in inputs divided by the change […]

The marginal product of labor is defined by the: a. change in output divided by the change in labor input usage. b. change in labor input usage divided by the change in output. c. output divided by the labor input […]

If there are two large firms, each with one-quarter of the market, and 10 firms, each with one-twentieth of the market, in an industry, the market four-firm concentration ratio will be: a. 40 b. 50 c. 60 d. 10 e. […]

Profit-maximizing cartels choose price equal to: a. marginal cost. b. average total cost of the last unit. c. marginal revenue. d. the monopolistically competitive price. e. the monopoly price. Wagner Machine Tool produces output according to Q = 4(KL)1/2, where […]

The average product of labor can be illustrated geometrically as the: a. slope of the total product curve with respect to labor. b. slope of the total product curve with respect to capital. c. slope of a chord from the […]

If total cost is given by TC = a + bQ ” cQ2 + dQ3, then average variable cost is minimized at units of output. a. Q* = a/2d b. Q* = b/2d c. Q* = c/3d d. Q* = […]

A graphical representation of the demand function is called a: a. demand schedule. b. demand curve. c. demand function. d. marginal revenue schedule. e. marginal revenue curve. Insurance companies are able to offset the adverse selection in markets for life […]

El Niño wind patterns affected the weather across the United States during the winter of 1997″1998. Suppose the demand for home heating oil in Connecticut is given by Q = 20 ” 2Phho + 0.5Png ” TEMP, where Q is […]

NotAlligator Briefcases estimates that its total cost of producing vinyl bags is TC = 65 + 9 / Q + 5Q2. At 3 units of output, NotAlligator’s marginal cost is: a. $113. b. $29. c. $27. d. $119. e. $9. […]

If a representative firm with long-run total cost given by TC = 2,000 + 20q + 5q2 operates in a competitive industry where the market demand is given by QD = 10,000 ” 40P, the long-run equilibrium output of the […]

The slope of a straight line is: a. positive. b. negative. c. zero. d. constant. e. nonconstant. The best possible pricing scheme in this figure would: a. encourage high-risk individuals to obtain full coverage. b. encourage all individuals to obtain […]

For the Minnie Mice Company, the elasticity of demand is “6, and the profit-maximizing price is 30. If MC is marginal cost and AVC is average variable cost, then: a. MC = 25. b. AVC = 25. c. MC = […]

Cal’s Cab Company (CCC) has a taxi monopoly in Wen Kroy. The demand for taxi services in Wen Kroy is given by Q = 1,500 ” P. CCC’s costs are given by TC = 100 ” Q2 + 5Q3. Its […]

Duopolists A and B face the following demand curves: QA = 120 ” 2PA + PB and QB = 120 ” 2PB + PA. If both firms have zero marginal cost and they form a cartel, what is the profit-maximizing […]

A firm has a division that produces X, whose total costs are TC = 10 + Q2 (where Q is the quantity of X). The marketing division adds its own total costs of 5 + 3Q. In the competitive external […]

When average variable cost is at its minimum: a. average total cost is increasing with increases in output. b. average variable cost plus average fixed cost is increasing with increases in output. c. average total cost is equal to average […]

For a producer of joint products X and Y with total revenue and RY, an isorevenue curve: a. isolates RX and RY separately. b. shows points where RX = RY . c. shows points where revenue curves are tangent. d. […]

Wilma’s Car Repair can repair cars using kryptonite bolts, K, or lithium bolts, L, as long as it uses 10 bolts in toto. The cost of repairing a car is TC = K2 + L2 ” KL. The cost-minimizing combination […]

The Institutional Possibilities frontier: a. Is the Samuelson curve b. The Bergson curve c. A measure of production possibilities d. Shows the choice between social losses wealth and income e. The Lorenz Curve f. Shows choice between order and disorder […]

The drafters of the US Constitution, such as Madison, were particularly worried about: a. the possibility of truly democratic elections b. violations of the Bill of Rights c. the Fifth Amendment d. not enough people voting e. protecting the interests […]

Marx’s notion that societies go through inevitable stages of evolution is called: a. Surplus value b. Dialectical materialism c. The socialist revolution d. Primitive capitalist accumulation e. All of the above Soft budget constraints is an idea of: a. Mises […]

A reform introduced under Deng: a. the Shanghai experiment b. the Great Leap c. the Cultural Revolution d. the Tang Reform e. free trade zones Gorbachev’s reforms were called a. loans for shares b. de-democratization c. the Liberman reform d. […]

The most commonly accepted cause of the European Crisis is: a. Fiscal profligacy b. Too little welfare spending c. Unemployment d. Current account deficit France uses civil law a. True b. False Answer: a The major source of financing in […]

The person credited with Chinese reforms a. Deng b. Mao c. Zhou d. Chaing e. Miller In the Wintrobe model of dictatorship: a. the dictator substitutes capital for repression b. power is created by capital and labor c. the dictator […]

The Glow-in-the-Dark Lamp Company produces 3.2 million light bulbs per year at a per unit cost of $0.50. If its total variable cost is $1.2 million, its a. marginal cost is $0.375. b. total fixed cost is $400,000. c. average […]

The following questions are based on the following graph, showing short-run supply and demand curves for a perfectly competitive market. The initial supply curve is labeled “Supply” and the initial demand curve is labeled “Demand.” Price 0A and output rate […]

To ensure the acceptability of money, a government must a. back it with gold or silver. b. create enough of it so people can purchase all the goods they want and need. c. limit its quantity relative to output. d. […]

A firm’s total output divided by the amount of input used to produce it is the ________ of the input. a. cost b. supply c. average product d. marginal product e. combined product When a price decrease produces a decline […]

An upward shift in the consumption function a. results if people decide they want to save more. b. has the same kind of multiplier effect as an increase in investment. c. occurs if people’s incomes rise. d. raises the average […]

The following questions are based on the following diagram: Suppose a sales tax on the commodity is imposed where S and D are the market supply and demand curves before the tax was levied. The equilibrium price with the tax […]

A yellow dog contract is an agreement a. by labor not to strike. b. by employers not to participate in a lockout. c. in which a worker agrees not to join a union. d. to engage in pattern bargaining. e. […]

Statements, propositions, or predictions about economic issues that can be tested in principle by an appeal to the facts are called ________ economics. a. positive b. passive c. normative d. mechanical e. comparative High rates of inflation often characterize a. […]

The following questions are based on the following diagram of a monopolist: If the monopolist is currently producing 0A and wants to maximize profits, it should a. do nothing because it is maximizing profits. b. decrease output to zero. c. […]