Archives: Quiz

1) Using antitrust law to split up an unregulated natural monopoly into several competing firms: A.would reduce product price. B.would increase product price. C.might either increase product price or reduce product price. D.will reduce average total cost. 2) in determining […]

1) Answer the next question(s) on the basis of the following table for a particular country in which C is consumption expenditures, Ig is gross investment expenditures, G is government expenditures, X is exports, and M is imports. All figures […]

1) the income and substitution effects account for: a.the upward sloping supply curve. b.the downward sloping demand curve. c.movements along a given supply curve. d.the “other things equal” assumption. 2) A farmer who has fixed amounts of land and capital […]

1) In the market for loanable funds: A.an increase in bank lending will increase the interest rate. B.a decrease in saving will reduce the interest rate. C.an increase in borrowing for investment will increase the interest rate. D.a decrease in […]

1) Monetarists and rational expectations theorists generally agree that: A.the Federal Reserve should adhere to a monetary rule. B.the rate of interest and the price of bonds are positively or directly related. C.the money supply cannot be measured and therefore […]

1) Resource pricing is important because: A.resource prices are a major determinant of money incomes. B.resource prices allocate scarce resources among alternative uses. C.resource prices, along with resource productivity, are important to firms in minimizing their costs. D.of all of […]

1) (last word) over the past twenty-five years, china has averaged annual growth rates of nearly: a.5 percent. b.9 percent. c.12 percent. d.15 percent. 2) Assume the current equilibrium level of income is $200 billion as compared to the full-employment […]

1) Assume that the commercial banking system has checkable deposits of $10 billion and excess reserves of $1 billion at a time when the reserve requirement is 20 percent. If the reserve requirement is now raised to 30 percent, the […]

1) the law of diminishing marginal utility states that: a.total utility is maximized when consumers obtain the same amount of utility per unit of each product consumed. b.beyond some point additional units of a product will yield less and less […]

1) the following cost data for a purely competitive seller: refer to the above data. if product price is $60, the firm will: a.shut down. b.produce 4 units and realize a $120 economic profit. c.produce 6 units and realize a […]

1) Refer to the above diagrams. The solid lines are production possibilities curves; the dashed lines are trading possibilities curves. The data suggest that: A.West Lothian should specialize in, and export, beer. B.both countries will be better off if they […]

1) The following 2008 balance of payments statement for Transylvania. All figures are in billions of dollars. Refer to the above data. Foreigners made a smaller volume of asset purchases in Transylvania in 2008 than Transylvanians made asset purchases abroad. […]

1) Assumptions: These two graphs show two sectors of the labor market for a particular kind of labor. Relevant product markets are competitive. The two labor demand curves are identical and initially the quantities of labor employed in the two […]

1) the invisible-hand concept suggests that: a.market failures imply the need for a national economic plan. b.big businesses are inherently more efficient than small businesses. c.the competitiveness of a capitalistic market economy invariably diminishes over time. d.assuming competition, private and […]

1) When the actual rate of inflation is less than the expected rate: A.the unemployment rate will temporarily rise. B.firms will increase their output to recoup their falling profits. C.the unemployment rate will temporarily fall. D.firms will experience rising profits […]

1) As a percentage of GDP, U.S. exports are: A.greater than U.S. imports. B.about 20 percent. C.considerably lower than in several other industrially advanced nations. D.higher than in Canada but lower than Mexico. 2) which of the following countries has […]

1) The U.S. demand for euros is: A.downsloping because, at lower dollar prices for euros, Americans will want to buy more European goods and services. B.downsloping because, at higher dollar prices for euros, Americans will want to buy more European […]

1) Which of the following is an example of a capital-intensive commodity? A.clothing B.wool C.sunflower seeds D.chemicals 2) How many commercial banks are now operating in the United States? A.about 140,000 B.about 7,300 C.about 11,000 D.about 6,300 Answer: B 3) […]

1) Refer to the above diagram. Which of the following would shift the aggregate demand curve from AD2 to AD1? A.a decline in personal income tax rates B.an increase in the international value of the dollar C.an increase in government […]

1) alejandro scoobertini owns a store specializing in soccer jerseys. in 2008, he purchased $150,000 worth of jerseys from manufacturers, employed one worker for $40,000, purchased $20,000 worth of supplies from an office supply store, and sold jerseys for $280,000. […]

1) pure monopoly means: a.any market in which the demand curve to the firm is downsloping. b.a standardized product being produced by many firms. c.a single firm producing a product for which there are no close substitutes. d.a large number […]

1) In which of the above market situations will the efficiency loss of an excise tax be the greatest? A.4 B.3 C.1 D.2 2) refer to the above diagram. realized economic growth is best represented by a: a.a move from […]

1) which of the following is incorrect? a.total fixed cost does not change with output in the short run. b.fixed costs exist only in the short run. c.total fixed cost must be added to total variable cost to determine total […]

1) The terms of trade reflect the: A.rate at which gold exchanges internationally for any domestic currency. B.ratio at which nations will exchange two goods. C.fact that the gains from trade will be equally divided. D.cost conditions embodied in a […]

1) As it relates to Federal Reserve activities, the acronym FOMC describes the: A.Federal Open Market Committee. B.Federal Options Market Committee. C.Federal Organization for Monetary Control. D.Federal Organization for Money Creation. 2) In the balance of payments of the United […]

1) According to new classical economists, the: A.short-run demand for labor curve is vertical. B.short-run aggregate demand curve is vertical. C.long-run aggregate supply curve is horizontal. D.long-run aggregate supply curve is vertical. 2) which of the following is an example […]

1) Rapid population growth since 1800 has occurred primarily because of: A.a significant increase in total fertility rates as living standards have risen. B.a significant reduction in death rates as living standards have risen. C.a significant increase in replacement rates […]

1) a market for human organs (rather than the current volunteer-donor system) would be expected to: a.reduce the quantity of organs supplied. b.increase total health care spending. c.decrease the demand for physicians who do transplants. d.create a surplus of organs. […]

1) Which diagram above best represents the problem faced by farms in the long-run? A.A B.B C.C D.D 2) The kinked-demand schedule that an oligopolist believes confronts the firm is given in the table below. Compute the oligopolists total revenue […]

1) Refer to the above diagrams. Suppose that government undertakes fiscal policy designed to increase aggregate demand from AD1 to AD2 and thereby to increase GDP from X to Z. In terms of graph B, which of the following might […]

1) A Federal funds rate reduction that is caused by monetary policy will: A.increase the prime interest rate. B.decrease the size of the monetary multiplier. C.increase the Fed’s discount rate. D.decrease the prime interest rate. 2) The rule of reason […]

1) Which of the following is a tool of monetary policy? A.open market operations B.changes in banking laws C.changes in tax rates D.changes in government spending 2) Complete the accompanying table. (a)What is the break-even level of income? How is […]

1) assume a pure monopolist is currently operating at a price-quantity combination on the inelastic segment of its demand curve. if the monopolist is seeking maximum profits, it should: a.retain its current price-quantity combination. b.increase both price and quantity sold. […]

1) the distribution of income among the owners of land, labor, capital, and entrepreneurial ability is known as: a.income differentials. b.the personal distribution of income. c.the functional distribution of income. d.the concentration ratio. 2) The commercial banking system borrows from […]

1) Use the diagram below to answer the questions. (a)If the economys production possibilities curve is shown by curve AB, then draw in a new curve which indicates positive economic growth. (b)If the economy illustrated by production possibilities curve AB […]

1) If two nations have different per capita income levels and their rates of economic growth are identical, then the absolute per capita income differential: A.will remain constant. B.may either widen or diminish. C.will diminish. D.will widen. 2) if at […]

1) refer to the above diagram. if actual production and consumption occur at q3: a.efficiency is achieved. b.an efficiency loss (or deadweight loss) of e + f occurs. c.an efficiency loss (or deadweight loss) of a + b + c […]

1) a constant-cost industry is one in which: a.resource prices fall as output is increased. b.resource prices rise as output is increased. c.resource prices remain unchanged as output is increased. d.small and large levels of output entail the same total […]

1) (consider this) refer to the above diagram. suppose that point y represents the optimal combination of civilian goods and defense goods. we can conclude that at y the marginal benefit of defense goods: a.exceeds the marginal cost of defense […]

1) from the 1970s to 1998, immigrants’ use of the u.s. welfare system was greater proportionately than the use by natives. this occurred primarily because: a.the mix of immigrants shifted from relatively skilled to relatively unskilled workers. b.funding for the […]

1) A positive externality or spillover benefit occurs when: A.product differentiation increases the variety of products available to consumers. B.the benefits associated with a product exceed those accruing to people who consume it. C.a firm produces at the P = […]

1) since their introduction, prices of dvd players have fallen and the quantity purchased has increased. this statement: a.suggests that the supply of dvd players has increased. b.suggests that the demand for dvd players has increased. c.constitutes an exception to […]

1) The term V in the equation of exchange is equal to: A.M/nominal GDP. B.nominal GDP/M. C.the reciprocal of the price level. D.nominal GDP/Q. 2) given the above information and assuming trade occurs between the three states we can expect: […]

1) what is the primary reason that changes in total spending lead to cyclical changes in output and employment? a.government is unable to respond by changing the amount of money in circulation. b.changes in total spending cause supply shocks that […]

1) If the reserve requirement is 10 percent, how much excess reserves does a bank acquire when a business deposits a $500 check drawn on another bank? A.$450 B.$400 C.$5000 D.$550 2) the smallest component of aggregate spending in the […]

1) the law of increasing opportunity costs is reflected in a production possibilities curve that is: a.an upsloping straight line. b.a downsloping straight line. c.concave to the origin. d.convex to the origin. 2) Suppose the full employment level of real […]

1) the following information for a pure monopolist: if the above profit-maximizing monopolist is able to price discriminate, charging each customer the price associated with each given level of output, how many units will the firm produce? a.2 b.3 c.4 […]

1) The bank panics of 1930-1933: A.resulted in the passage of the Smoot-Hawley Act. B.boosted the nation’s money supply, causing inflation. C.directly resulted in the Federal insured deposit program. D.caused a significant outflow of gold from the United States. 2) […]

1) Assume the Environmental Protection Agency imposes an excise tax on polluting firms. In which of the following situations would we expect the additional costs to be borne most heavily by consumers? A.demand is highly elastic and supply is highly […]

1) refer to the above diagram. the base year used in determining the price indices for this economy: a.cannot be determined from the information given. b.is some year before 2000. c.is more recent than 2000. d.is 2000. 2) economists who […]