Archives: Quiz

1) The following are commonly-used arguments for protection against imports, except: A.Self-sufficiency and diversification-for-stability B.Protection against dumping C.Infant industry protection D.Price- and profit-maintenance 2) The marginal revenue product schedule is: A.the same whether the firm is selling in a purely […]

1) In 2012, the United States’ balance on goods was about: A.-$735 billion. B.+$630 billion. C.-$540 billion. D.+$199 billion. 2) Which of the following would be primarily determined in the resource markets? A.The airfares charged by airlines for family vacations […]

1) Many governments end up with chronic budget deficits because: A.Many government programs are popular with voters, but hardly any voter likes paying taxes B.The nation simply cannot produce everything that it consumes, so it has to rely on others […]

1) Refer to the diagram above, which shows three supply curves for corn. A movement from point a to point b is caused by a change in the: A.Price of resources used to produce corn B.Number of corn farmers C.Price […]

1) The principle of comparative advantage indicates that mutually beneficial international trade can take place only when: A.Tariffs are eliminated B.Transportation costs are almost zero C.Relative costs of production differ between nations D.A country can produce more of some product […]

1) If the law of diminishing returns applies to study time: A.the tenth hour of study will likely be less productive than the third. B.this implies that longer lectures are less productive than shorter ones. C.there is no benefit to […]

1) Which of the following cases established that the mere possession of monopoly power violated antitrust laws? A.IBM case of 1982 B.Microsoft case of 1998 C.Alcoa case of 1945 D.AT&T case of 1982 2) According to behavioral economics: A.gains are […]

1) The basic explanation for high real wages in the United States and other industrially advanced economies is that the: A.Labor supply has increased more rapidly than labor demand in these nations B.Labor demand has increased more rapidly than labor […]

1) A monopolistically competitive industry combines elements of both competition and monopoly. It is correct to say that the competitive element results from: A.a relatively large number of firms and the monopolistic element from product differentiation. B.product differentiation and the […]

1) The ability to impose fines, revoke licenses, and put people into jail allows the government to: A.Ensure positive profits for its agencies B.Maximize revenues from its operations C.Enforce involuntary transactions D.Set market prices for goods and services 2) Cash […]

1) The following factors have boosted farm income per farm household in the U.S., except: A.Consolidation of farms B.Outmigration from farming C.Stronger or appreciating dollar D.Significant government subsidies 2) Which would be an avenue for resolving the inefficiencies associated with […]

1) If the wage rate in a purely competitive labor market increases, it will cause the: A.Marginal resource cost curve for a single competitive firm in the industry to shift down B.Marginal resource cost curve for a single competitive firm […]

1) Answer the following questions based on the payoff matrix for a single-period, two-firm game for firms, Capoc and Caroc. The numbers in the matrix indicate the profit in billions of dollars for a national of regional strategy. The profit […]

1) Refer to the diagram. Arrows (1) and (3) are associated with: A.the money market. B.the resource market. C.the product market. D.international trade. 2) Kara and Kyle are competing sockeye salmon fishers. Both have been allocated ITQs that limit their […]

1) Suppose that Ms. Thomson is currently exhausting her money income by purchasing 10 units of A and 8 units of B at prices of $2 and $4 respectively. The marginal utility of the last units of A and B […]

1) Which of the following would be an example of a moral hazard problem? A.A person in poor health who purchases life insurance B.A person who is taxed on the purchase of a carton of cigarettes C.A person who purchases […]

1) Refer to the diagrams for two separate product markets. Assume that society’s optimal level of output in each market is Q0 and that government purposely shifts the market supply curve from S to S1 in diagram (a) on the […]

1) Refer to the above graph for a purely competitive firm. When the firm is in equilibrium in the short run, its average fixed cost is: A.EH B.DE C.DH D.DB 2) If you sum the squares of the market shares […]

1) If taxes are $2,000 when income is $15,000 and they are $3,000 when income is $19,000, then the marginal tax rate is: A.20 percent B.25 percent C.30 percent D.40 percent 2) Which statement is correct? A.The percentage change in […]

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 […]

1) The Federal Trade Commission: A.is empowered to hold public hearings to investigate unfair practices. B.prohibits interlocking directorates in interstate industries. C.regulates airline fares. D.regulates such transportation industries as railroads and trucking. 2) A child is given $4 of pocket […]

1) Why is the percentage of business research and development spending for basic research so small? A.Basic research is the sole responsibility of university research labs B.Scientific knowledge has minimal effect on technological advance C.Scientific principles cannot be easily patented […]

1) If a nondiscriminating pure monopolist decides to sell one more unit of output, the marginal revenue associated with that unit will be: A.equal to its price. B.the price at which that unit is sold less the price reductions that […]

1) Assume that a consumer purchases a combination of product A and product B such that the MUa/Pa = 8 and MUb/Pb = 6. To maximize utility without spending more money, the consumer should: A.Purchase less of product A and […]

1) Answer the following question based on the data provided in the tables below for two hypothetical nations, Wat and Xat. The nations have the production possibilities for rice and corn given in the following table: Refer to the data […]

1) If a country has a total fertility rate of 1.8, then all else equal we would expect: A.population in that country to rise over time. B.population in that country to fall over time. C.the replacement rate to also equal […]

1) Refer to the graphs above. Which one shows a perfectly elastic demand? A.Graph A B.Graph B C.Graph C D.Graph D 2) A firm considering whether to borrow money to purchase a capital good will compare the rate of interest […]

1) Fixed cost is: A.the cost of producing one more unit of capital, for example, machinery. B.any cost that does not change when the firm changes its output. C.average cost multiplied by the firm’s output. D.usually zero in the short […]

1) A deficit on the current account: A.normally causes a surplus on the capital and financial account. B.normally causes a deficit on the capital and financial account. C.has no relationship to the capital and financial account. D.means that a nation […]

1) Refer to the above graph of the market for wheat. The government adopts a price support program for wheat, and supports the wheat price at P2. The triangular area defined by points B and C and the intersection of […]

1) In a nation’s balance of payments, which one of the following items is always recorded as a positive entry? A.Goods imports. B.Changes in foreign currency reserves. C.U.S. purchases of assets abroad. D.Exports of services. 2) DASH Airlines is considering […]

1) Assuming competitive markets with typical supply and demand curves, which of the following statements is correct? A.An increase in supply with a decrease in demand will result in an increase in price. B.An increase in supply with no change […]

1) Which of these sets of nations are low-income developing nations? A.Brazil, Australia, and South Africa. B.Uganda, Madagascar, and Burkina Faso. C.Canada, Switzerland, and France. D.Germany, South Korea, and Mexico. 2) In the long run a firm will choose a […]

1) Refer to the given data. The marginal revenue product of the fourth worker is: A.$8. B.$52. C.$2. D.$4. 2) Refer to the diagram. In short-run equilibrium, the monopolistically competitive firm shown will set its price: A.below ATC. B.above ATC. […]

1) Refer to the diagram. Which of the following is a normative statement? A.Point C is superior to point B because it is important to enhance the future of society. B.If society is initially at point C, it must sacrifice […]

1) As it relates to R&D, the expected-rate-of-return curve, r: A.usually slopes upward. B.shows the cost of financing various levels of R&D. C.varies in location depending on the location of the interest-rate cost-of-funds curve, i. D.represents the marginal benefit element […]

1) Which of the following best explains why most basic scientific research in the United States is financed by the government? A.Basic scientific research takes a long time to become commercially viable. B.Basic scientific research rarely results in commercially viable […]

1) Which set of characteristics below best describes the basic features of monopolistic competition? A.Easy entry, many firms, and standardized products B.Barriers to entry, few firms, and differentiated products C.Easy entry, many firms, and differentiated products D.Easy entry, few firms, […]

1) Interindustry competition means that: A.in oligopolistic industries a few large firms compete with one another in bidding down product price. B.in some markets the producers of a particular product might face competition from products produced by other industries. C.firms […]

1) Refer to the above graphs. The formation of an exclusive or craft union, with no change in demand, is depicted by situation: A.A B.B C.C D.D 2) Refer to the graph above. Suppose consumers do not fully appreciate the […]

1) Refer to the diagram pertaining to two nations and a specific product. The equilibrium world price occurs at: A.F. B.I. C.G. D.J. 2) The basic purpose of antitrust laws is to: A.Provide subsidies for American business B.Limit monopoly power […]

1) In Germany, one worker can produce either one cuckoo clock or one beer mug. In Taiwan, one worker can produce either two cuckoo clocks or three beer mugs. Who has the comparative advantage in each good? A.Taiwan in both […]

1) Refer to the supply and demand data for a certain elective surgical procedure. If suppliers provide the quantity of health care demanded and insurance pays 50 percent of the remaining equilibrium price after a $1,000 deductible is satisfied, the […]

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) […]

1) A firm pays the market equilibrium wage of $15.00 an hour, and the workers produce 25 units of output an hour. If the firm adopts an efficiency-wage policy, then the wage rate for these workers would be expected to: […]

1) Informal collusion to restrict output and increase prices is sometimes referred to as a: A.Merger B.Cartel C.Tacit understanding D.Kinked-demand oligopoly 2) An implication of the taste-for-discrimination model is that: A.discrimination can lower a firm’s production costs. B.discrimination will move […]

1) ATMs and human bank tellers: A.are substitute resources. B.are capital goods. C.have both declined in number because of bank mergers. D.are complementary resources. 2) What health care program provides payment for medical benefits to certain low-income people, including the […]

1) Use the resource demand data shown on the left and the resource supply data on the right in answering the following question: Refer to the given data. How many workers will this profit-maximizing firm choose to employ? A.6 B.5 […]

1) One reason for the year-to-year instability of agricultural product demand is the: A.High price-elasticity for agricultural products B.Fluctuations in weather patterns C.Declining role of technological progress in agriculture D.Greater dependence on exports to foreign markets 2) Which of the […]

1) Refer to the diagram, where Sd and Dd are the domestic supply and demand for a product and Pc is the world price of that product. With a per-unit tariff of PcPt, the total amount of tariff revenue collected […]