Archives: Quiz

1) If in a certain year the indices of prices received and paid by farmers were 115 and 142 respectively, the parity ratio (in percentage terms) would be: A.123. B.81. C.69. D.27. 2) the smoot-hawley act: a.bound the world’s nations […]

1) The law of increasing opportunity costs: A.applies to land-intensive commodities, but not to labor-intensive or capital-intensive commodities. B.results in straight-line production possibilities curves rather than curves that are bowed outward from the origin. C.refutes the principle of comparative advantage. […]

1) Refer to the above data. If a lump-sum tax (the same tax amount at each level of GDP) of $40 is imposed in this economy, the marginal propensity to consume is: A..8 before taxes and .6 after taxes. B..8 […]

1) A person arguing that income inequality is actually less than that described by the standard Census data might say that the: A.Census data fail to include cash transfers as income. B.Census data fail to include the value of noncash […]

1) which of the following is correct? a.there is no relationship between mp and mc. b.when ap is rising mc is falling, and when ap is falling mc is rising. c.when mp is rising mc is rising, and when mp […]

1) the free-rider problem is associated with: a.all market goods. b.the structure of airline fares. c.producing goods that have characteristics of public goods. d.the overallocation of the resources to transportation facilities. 2) in a competitive market economy firms will select […]

1) the production possibilities curve shows: a.the various combinations of two goods that can be produced when society employs all of its scarce resources. b.the minimum outputs of two goods that will sustain a society. c.the various combinations of two […]

1) which of the following has been an outcome of the north american free trade agreement (nafta)? a.a lower standard of living in canada, mexico, and the united states b.lower wages in the united states and canada c.increased trade among […]

1) refer to the above diagram, in which solid arrows reflect real flows; broken arrows are monetary flows. flow (8) might represent: a.personal income taxes. b.automobile purchases by the state of maine. c.the services of firefighters. d.subsidies to farmers. 2) […]

1) the optimal or allocatively efficient point on a production possibilities curve is achieved where: a.the smallest physical amounts of inputs are used to produce each good. b.each good is produced at a level where marginal benefits equal marginal costs. […]

1) In international financial transactions, what are the only two things that individuals and firms can exchange? A.currency and real assets. B.services and manufactured goods. C.preexisting assets and currently produced goods and services. D.currency and currently produced goods and services. […]

1) (Consider This) Governments’ main economic concern about low birthrates is that: A.in a few decades there will not be enough working age adults to support pension responsibilities to retirees. B.the smaller population makes the economy more vulnerable to foreign […]

1) The reserve ratio refers to the ratio of a bank’s: A.reserves to its liabilities and net worth. B.capital stock to its total assets. C.checkable deposits to its total liabilities. D.required reserves and vault cash to its checkable deposits. 2) […]

1) U.S. firms collectively devote the largest portion of their total R&D spending to: A.applied research (pursuing invention). B.basic scientific research. C.innovation and diffusion. D.financing startup firms. 2) In the table below are aggregate demand and supply schedules. (a)On the […]

1) In the absence of unexpected shocks, the economy will tend to experience: A.positive, non-inflationary growth. B.no changes in output or prices. C.positive growth with mild amounts of deflation. D.positive growth with mild amounts of inflation. 2) Refer to the […]

1) Refer to the above graph. Which of the lines in the above diagram represent(s) a progressive tax? A.both A and B. B.D only. C.C only. D.B only. 2) Gomez argues that we need to increase the nation’s output. Chang […]

1) 2) economists who believe that the recent productivity acceleration may be permanent claim that the above-normal economic growth in the united states between 1995 and 2007 was caused by: a.increases in the rate of personal saving. b.increased entrepreneurial activity, […]

1) assumptions: 1) employers in this market are willing and able to ignore minimum wage laws; 2) sd represents the supply of domestically-born (and legal immigrant) workers; 3) st represents the total supply of workers in this labor market (sd […]

1) Which of the following groups has the lowest poverty rate? A.married-couple families B.whites C.foreign-born (not citizens) D.African-Americans 2) In 1993 the Federal government boosted income tax rates. In the seven years that followed: A.tax revenues fell slightly. B.productivity growth […]

1) Refer to the above market for money diagrams. The total demand for money is shown by: A.D1. B.D2. C.D3. D.S. 2) Suppose the firms in a five-firm industry have market shares of 30, 30, 20, 10, and 10 percent, […]

1) Suppose a commercial bank has checkable deposits of $100,000 and the legal reserve ratio is 10 percent. If the bank’s required and excess reserves are equal, then its actual reserves: A.are $30,000. B.are $10,000. C.are $20,000. D.cannot be determined […]

1) (Last Word) Classical macroeconomics was dealt severe blows by: A.the Great Depression and Keynes’s macroeconomic theory. B.the Second World War and the writings of Milton Friedman. C.Adam Smith and his idea of the invisible hand. D. the strong recovery […]

1) to be officially unemployed a person must: a.be in the labor force. b.be 21 years of age or older. c.have just lost a job. d.be waiting to be called back from a layoff. 2) which of the following is […]

1) answer the next question(s) on the basis of the following data. all figures are in billions of dollars. refer to the above data. disposable income is: a.$83. b.$73. c.$75. d.$77. 2) a demand curve which is parallel to the […]

1) if the economy adds to its inventory of goods during some year: a.gross investment will exceed net investment by the amount of the inventory increase. b.this amount should be ignored in calculating that year’s gdp. c.this amount should be […]

1) refer to the above figure that shows the market for u.s. health care. other things equal, which of the following would shift the supply curve for medical care from s1 to s2? a.greater reliance on skilled nurses rather than […]

1) Melanie and Oli are competing Pacific Halibut fishers. Both have been allocated ITQs that limit their catch to 1,000 tons of Pacific Halibut each. Melanie’s cost per ton is $20; Oli’s cost per ton is $28. Refer to the […]

1) a price index can rise from one year to the next even though: a.some individual prices in the economy fall. b.nominal gdp falls. c.real gdp falls. d.all of these occur. 2) effectively removing all illegal immigrants from u.s. labor […]

1) Which of the following is not a feature of the Food, Conservation, and Energy Act of 2008? A.direct payments (direct subsidies) based on crops previously grown B.countercyclical payments C.marketing loans D.acreage allotments (restrictions on the number of acres that […]

1) (Last Word) According to economists Aryes and Levitt, the total benefits of Lojack and other car retrieval system are divided: A.90 percent to the owners and 10 percent to other car owners in the community. B.50 percent to the […]

1) According to monetarists: A.changes in the money supply are the primary cause of changes in the price level. B.an expansionary fiscal policy will lower interest rates and overstimulate the economy. C.changes in the velocity of money are more important […]

1) Which of the following would contribute to a United States balance of payments surplus? A.the United States makes a unilateral tariff reduction on imported goods B.General Motors pays a dividend to a Swiss stockholder C.the United States cuts back […]

1) Refer to the above 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) when diseconomies of scale occur: a.the long-run average total cost curve falls. b.marginal […]

1) Currency (paper money plus coins) constitutes about: A.81 percent of the U.S. M1 money supply. B.56 percent of the U.S. M1 money supply. C.46 percent of the U.S. M1 money supply. D.11 percent of the U.S. M1 money supply. […]

1) other things equal, and given that the elasticity of demand of health care is 0.2, a 10 percent increase in the price of health care in the united states will reduce the quantity of health care demanded by about: […]

1) The following information: The Fed is going to auction $30 billion in reserves using the term auction facility. It receives the following bids: Refer to the above information. As a result of the auction, how much and at what […]

1) Refer to the above diagram where D and S are the United States’ demand for and supply of Swiss francs. At the equilibrium exchange rate, E, the United States’ balance of payments is in equilibrium. Under a system of […]

1) if the equilibrium exchange rate changes so that it takes more dollars to buy a british pound, then: a.the dollar has appreciated in value. b.americans will import more british goods. c.the british will buy fewer u.s. goods. d.the dollar […]

1) export subsidies are: a.maximum limits on the quantity or total value of specific products imported to a nation. b.excise taxes or duties placed on imported products. c.licensing requirements, unreasonable quality standards, and the like designed to impede imports. d.government […]

1) (Advanced analysis) Answer the next question(s) on the basis of the following information for a mixed open economy. The letters Y, Ca, Ig, Xn, G, and T stand for GDP, consumption, gross investment, net exports, government purchases, and net […]

1) Which of the following are included and which are excluded in calculating this years GDP? Explain in each instance. (a)A monthly scholarship check received by an economics student (b)The purchase of a new truck by a trucking company (c)Government […]

1) The demand schedule for the product produced by a monopolist is given in the table below. Complete the table by computing total revenue and marginal revenue. (a)What do the data in the table indicate about the relationship between total […]

1) refer to the above diagram for a natural monopolist. if a regulatory commission set a maximum price of p2, the monopolist would: a.produce output q1 and realize an economic profit. b.produce output q3 and realize an economic profit. c.close […]

1) Suppose the government cuts taxes to keep the economy’s standardized budget in balance when the economy is expanding. The government is engaging in a(n): A.contractionary fiscal policy. B.expansionary fiscal policy. C.low-interest rate policy. D.neutral fiscal policy. 2) negative externalities […]

1) A special-interest issue is one whose passage yields: A.large private benefits compared to external benefits. B.large external benefits compared to private benefits. C.small economic losses to a small number of people and large economic losses to a large number […]

1) Refer to the above diagram. If demand is D2, a tax of A per acre will: A.encourage the substitution of land for other productive resources. B.lower the cost of land to individual farmers. C.reduce the demand for land to, […]

1) if the aggregate income of households is $300 billion, consumption is $210 billion, and personal taxes are $60 billion, then personal saving: a.is $70 billion. b.is $30 billion. c.is $40 billion. d.cannot be determined from the information given. 2) […]

1) if a profit-seeking competitive firm is producing its profit-maximizing output and its total fixed costs fall by 25 percent, the firm should: a.use more labor and less capital to produce a larger output. b.not change its output. c.reduce its […]

1) assume an economy that is producing only one product. output and price data for a three-year period are as follows. answer the next question(s) on the basis of these data. refer to the above data. if year 2 is […]

1) Refer to the above diagram. Assume that G and T1 are the relevant curves and that the economy is currently at B, which is its full-employment GDP. This economy has a: A.standardized budget surplus only. B.standardized budget deficit only. […]