Archives: Quiz

1) Which of the following is a public assistance or welfare program as opposed to a social insurance program? A.Supplemental Security Income (SSI). B.Unemployment compensation. C.Medicare. D.Social Security. 2) Assume the Environmental Protection Agency imposes an excise tax on polluting […]

1) What is one of the major shortcomings of using tariffs or quotas to ‘save American jobs”? A.Trade barriers protect the development of new technology, but the new technology eliminates jobs B.Import restrictions alter the composition of domestic employment, but […]

1) Which of the following countries has the highest Gini ratio, as of 2011? A.Italy. B.United States. C.South Africa. D.Mexico. 2) When the elasticity coefficient for resource demand is less than one, resource demand is: A.inelastic. B.elastic. C.unit-elastic. D.infinitely elastic. […]

1) Refer to the diagram, in which solid arrows reflect real flows; broken arrows are monetary flows. Flow (5) might represent: A.personal income tax revenues. B.the provision of public schools by local governments. C.the purchase of laptop computers by the […]

1) The first working prototype of a microcomputer chip would be an example of an: A.Innovation B.Imitation C.Invention D.Infusion 2) A major criticism of the parity concept is that: A.It is based on relative prices from a long time ago […]

1) An oil company is considering drilling in the Gulf at a current cost of $300,000 with an expected profit of $500,000 in three years. The current market rate is 10 percent. Should the company make the investment? A.Yes, the […]

1) The Sherman Act of 1890 outlawed: A.Monopoly pricing and foreign trade B.Price discrimination and monopoly profits C.Restraint of trade and monopolization D.Foreign trade and monopolization 2) Refer to the above graph. To maximize profits, the firm should produce the […]

1) Answer the question based on the following information. Normal University has found it necessary to institute a crime-control program on its campus to deal with the high costs of theft and vandalism. The university is now considering several alternative […]

1) In a graph showing the market supply and demand for British pounds in terms of U.S. dollars, the supply-of-pounds curve is upsloping because: A.Fewer British pounds can be purchased per dollar if U.S. dollars become more expensive B.Fewer U.S. […]

1) Use the following table for Country X to answer the question below. Column 1 of the table is the price of a product. Column 2 is the quantity demanded domestically (Qdd) and Column 3 is the quantity supplied domestically […]

1) Illegal immigrants make up about what percent of all agricultural workers in the U.S.? A.10% B.5% C.40% D.25% 2) Refer to the above table. The average variable cost of producing 35 units of output is: A.$6.00 B.$7.43 C.$4.57 D.$1.43 […]

1) Refer to the data. At $20 million of R&D expenditures, the: A.marginal cost of R&D exceeds the marginal benefit. B.expected total return from R&D is at a maximum. C.interest-rate cost of funds is negative. D.marginal benefit of R&D exceeds […]

1) What is the best economic explanation for why a person would drop out of college to take a job or start a business? A.he has a good idea for starting a business B.he has to pay a higher tuition […]

1) U.S. workers will be attracted to otherwise undesirable work as long as: A.The compensating wage differential is high enough B.The compensating wage differential is low enough C.There are not enough illegal immigrants to fill all of the available jobs […]

1) The individual firm which hires labor under competitive conditions faces a labor supply curve which: A.Slopes downward to the right B.Is perfectly elastic C.Is perfectly inelastic D.Is of unit elasticity 2) “For whom is a given mix of goods […]

1) Refer to the given data. We can conclude from the information given that this firm is a: A.pure monopolist. B.discriminating monopolist. C.monopolistic competitor. D.pure competitor. 2) The price elasticity of demand for a popular sporting event is 2. If […]

1) The tragedy of the commons occurs primarily: A.where government subsidies are present. B.when incentives to preserve are strongest. C.where property rights are lacking. D.on privately held lands. 2) The results of running the dictator game experiments thousands of times […]

1) If the total costs of producing 1,500 units of output is $15,000 and this output sold to consumers for a total of $16,500, then the firm would earn profits of: A.$1,000 B.$16,500 C.$1,500 D.$15,000 2) In which market model […]

1) Suppose that Rosa is considering migration to another country. To move, she will have to spend $5000 on transportation and $4000 in application and other processing fees. Rosa’s stream of future earnings in her home country is $500,000. She […]

1) Which of the following is least likely to violate the Sherman Act or the Clayton Act? A.Competitive firms A, B, and C meet and agree to charge a common price. B.Competitive firms D and E, each with 35 percent […]

1) Federal food distribution programs such as the food stamp program represent efforts to: A.Increase supplies of agricultural commodities B.Increase demand for agricultural commodities C.Decrease the value of farming to the nation D.Facilitate the movement of people from farms to […]

1) According to Paul Ehrlich’s 1968 prediction in The Population Bomb, population growth would result in: A.Overuse of natural resources leading to famines B.Stable uses of natural resources creating long-term stability C.Efficient use of natural resources fostering prosperity D.Reduced dependence […]

1) Firms are motivated to minimize production costs because: A.it is the most environmentally friendly way to produce goods. B.least-cost production techniques use the smallest total quantity of resources. C.competitive pressures in the market will drive out higher-cost producers. D.the […]

1) Which of the following measurement issues makes interpretation of U.S. poverty rates difficult? A.Poverty statistics measure consumption rather than income, and some families may receive income that is above the official poverty line. B.The high cost of living in […]

1) The demand curve in a purely competitive industry is ______, while the demand curve to a single firm in that industry is ______. A.perfectly inelastic; perfectly elastic B.downsloping; perfectly elastic C.downsloping; perfectly inelastic D.perfectly elastic; downsloping 2) The view […]

1) Which would cause an increase in the supply curve of cell-phone services? A.A decrease in the wages of phone-company workers B.An increase in the price of cell-phone services C.An increase in the taxes paid by cell-phone service providers D.A […]

1) The introduction of automatic elevator equipment allowed firms to handle the movement of people in a multi-story building at less cost, thus decreasing the demand for elevator operators. The best explanation for this change is that the: A.Marginal product […]

1) Assume that if the interest rate that businesses must pay to borrow funds were 20 percent, it would be unprofitable for businesses to invest in new machinery and equipment, so investment would be zero. But if the interest rate […]

1) An industry with which of the following four-firm concentration ratios would tend to have the greatest amount of R&D expenditures as a percentage of sales? A.0 B.10 C.50 D.100 2) Which of the following is not characteristic of long-run […]

1) In the United States, the rate of unionization is: A.higher for sales workers than for transportation workers. B.lower for managers than for teachers. C.lower for production workers than for sales workers. D.higher for social workers than for protective service […]

1) The table below shows the weekly demand for hamburger in a market where there are just three buyers. Refer to the above table. If the price of hamburger falls from $5 to $3, then the weekly market quantity demanded […]

1) Which of the following is not included in the current account of a nation’s balance of payments? A.Its goods exports. B.Its goods imports. C.Its net investment income. D.Its purchases of real assets abroad. 2) Answer the question on the […]

1) Which of the following is a distinguishing feature of laissez-faire capitalism? A.Public ownership of all capital. B.Central planning. C.Minimal government intervention. D.A circular flow of goods, resources, and money. 2) Which of the following statements is true? A.Microeconomics focuses […]

1) Refer to the diagrams. The case of a normal good is represented by figure: A.A B.B C.C D.D 2) The satisfaction or pleasure one gets from consuming a good or service is called: A.Price B.Utility C.Income D.Profits Answer: B […]

1) The ability of the DVCs to use the technologies of the IACs is somewhat limited because: A.the IACs have patents on most of their technologies. B.the IACs and the DVCs have much different resource endowments. C.the technologies of the […]

1) Refer to the above table, which shows the ranked preferences of voters for three alternative projects, with “1” being the top preference. This situation illustrates the voting inconsistency where a majority of voters prefer the: A.Stadium over the park, […]

1) The dollar votes of consumers ultimately determine the composition of output and the allocation of resources in a market economy. This statement best describes the concept of: A.derived demand. B.consumer sovereignty. C.the invisible hand. D.market failure. 2) In a […]

1) The rent paid for the pasture land used to graze cattle would increase if: A.the productivity of the land increased. B.people decided to consume more beef. C.oil deposits were discovered on the land. D.any of these occurred. 2) In […]

1) Refer to the long-run cost diagram for a firm. If the firm produces output Q2 at an average cost of ATC3, then the firm is: A.producing the profit-maximizing output but is failing to minimize production costs. B.incurring X-inefficiency but […]

1) In a market system, a firm’s employees are typically shielded from business risk by: A.Profit-sharing agreements B.Wage contracts C.The Social Security program D.Paid vacation leaves 2) Draw a graph of the short-run cost curves for a purely competitive firm […]

1) Consider the following situations and determine whether they exhibit simultaneous consumption, network effects, x-inefficiency or rent-seeking behavior. Assume the businesses referenced function as monopolies. (a)A pharmaceutical company discovers a vaccine for the common cold. The company puts a significant […]

1) Refer to the payoff matrix. Suppose that Speedy Bike and Power Bike are the only two bicycle manufacturing firms serving the market. Both can choose large or small advertising budgets. If this is a repeated game, it is in […]

1) What does “there is no such thing as a free lunch” mean in economics? A.That scarce resources are used up to provide “freebies” and giveaways B.That sometimes people may take friends out to lunch and pay for them C.That […]

1) Overall, economists believe that deregulation of industries formerly subjected to industrial regulation: A.has been a clear failure. B.is neutral in its impact to society’s well-being, creating minimal net benefits at best. C.has produced large net benefits for consumers and […]

1) Factors that have hampered the increase in the supply of physicians in the U.S. include the following, except: A.Actions by doctors’ unions, like the AMA B.Rising direct expenses for a medical degree C.Higher opportunity cost of medical education and […]

1) What was the largest U.S. fishery, in dollar terms, in 2010? A.Pacific halibut. B.Lobster. C.Walleye pollock. D.Sea scallop. 2) For a monopolistically competitive firm in long-run equilibrium: A.price will equal marginal cost. B.price will equal average total cost. C.marginal […]

1) In competitive markets, a surplus or shortage will: A.Never exist because the markets are always at equilibrium B.Cause changes in the quantities demanded and supplied that tend to eliminate the surplus or shortage C.Cause shifts in the demand and […]

1) A balance-of-payments deficit occurs: A.when a nation must make an inpayment of official reserves to its capital and financial account. B.whenever a nation has a goods and services deficit. C.whenever a nation has a goods and services surplus. D.when […]

1) All of the following are consequences of a government’s having to deal with a “debt crisis”, except: A.Very restricted ability to borrow money B.Being forced to drastically raise taxes C.Being forced to make drastic cuts in spending D.Being forced […]

1) “Remittances” occur when: A.two countries send immigrants to each other in approximately equal numbers. B.physical capital flows into a country that has lost labor due to migration. C.immigrants send financial payments back to family in their country of origin. […]