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Q:
Which of the following is not a true statement about the Lorenz curve?A) The Lorenz curve includes both money income and income in kind.B) The Lorenz curve does not include unreported income obtained from the underground economy.C) The Lorenz curve does not consider different sizes of households.D) The Lorenz curve does not consider age differences among wage earners.
Q:
State right-to-work lawsA) prohibit discrimination in hiring.B) force companies to submit to Equal Employment Opportunities Commission arbitration in disputes.C) encourage companies to hire minorities.D) make compulsory union membership illegal.
Q:
The demand curve for labor will shift whenever A) the demand for the final product changes. B) the wage rate changes.C) the supply curve of labor shifts. D) the marginal factor cost changes.
Q:
When trying to determine if a firm has monopoly power, courts in the United States tend to examine
A) the firmʹs percentage share of the ʺrelevant market.ʺ
B) the composition of the firmʹs board of directors.
C) the way in which the firm has differentiated its product.
D) the absolute dollar value of business the firm collects each year.
Q:
This agency develops and enforces environmental standards for air, water, toxic waste, and noise.
A) Environmental Protection Agency
B) Consumer Product Safety Commission
C) Equal Employment Opportunity Commission
D) Occupational Safety and Health Administration
Q:
Which of the following is likely among the most concentrated industries in the United States?A) printing and publishing B) breakfast cerealsC) primary aluminum D) computers
Q:
In the above figure for a monopolistically competitive firm, the total revenue at the profit-maximizing point isA) $540 B) $840 C) $400 D) $880
Q:
A monopolist would not be able to make a positive profit at any price output combination whenA) marginal cost is less than average total cost for one more unit of output.B) the average variable cost curve is everywhere above the marginal revenue curve.C) the minimum point of the average total cost curve lies to the right of the minimum of the average variable cost curve.D) the average total cost curve is everywhere above the demand curve.
Q:
All of the following are true about a monopolist EXCEPT A) the demand curve for its product is perfectly elastic. B) it produces a product with no close substitutes.C) its demand curve is the same as the market demand for the industry.D) it is a single seller of a good or service.
Q:
Refer to the above figure. The firmʹs short -run shutdown price isA) at $1. B) at $2. C) at $4. D) above $4.
Q:
Every point on the long-run average cost curve isA) also a minimum point on a short-run average cost curve. B) on a short-run average total cost curve.C) on a short-run average variable cost curve. D) on a short-run marginal cost curve.
Q:
In the above table, the average product of the fifth worker isA) 35. B) 135. C) -5. D) 27.
Q:
An advantage of the partnership form of business organization isA) its limited liability.B) its limited access to capital, thus reducing the possible size of debt. C) the ability of its owners to specialize.D) that it is difficult to start up, because a lot of thought has to go into the establishment of the firm.
Q:
Use the above figure. When the budget line rotates from ʺbʺ to ʺcʺA) the price of product J increases and the quantity demanded of product J decreases. B) the price of product J decreases and the quantity demanded of product J increases.C) the price of product K increases and the quantity demanded of product K decreases. D) the price of product K decreases and the quantity demanded of product K increases .
Q:
The consumer optimum is defined asA) the set of goods and services that maximizes marginal utility for each good.B) the set of goods and services such that the marginal utility of each good equals zero.C) the set of goods and services that maximizes the marginal utility of each good consumed. D) the set of goods and services, subject to the limited income of the consumer, that maximizes the total utility of the consumer.
Q:
ʺThe income elasticity of a good is positive if a consumer increases the total spending on that good as a result of an increase in its market price.ʺ Do you agree or disagree? Why?
Q:
A demand relationship that is a vertical line up from the quantity axis isA) perfectly elastic. B) unit-elastic.C) perfectly inelastic. D) somewhat elastic.
Q:
Explain why the buffalo almost became extinct while cattle did not, even though both provide similar goods for people.
Q:
How is moral hazard related to health care?
Q:
All of the following are income in kind EXCEPTA) income received from family members. B) services produced in the home.C) government provided food stamps. D) government provided medical aid.
Q:
Which of the following is FALSE regarding unions?A) The American Federation of Labor (AFL), composed of craft unions, was formed in 1886 under the leadership of Samuel Gompers.B) For a period after World War I the government temporarily stopped protecting laborʹs right to organize.C) During the Great Depression, legislation was passed that made collective bargaining illegal.D) The AFL and the CIO merged in 1955.
Q:
Goods X and Y are substitutes. If the price of good Y falls, the marginal revenue product of good XA) will not change. B) will shift out. C) will become more inelastic. D) will shift in.
Q:
The act of offering two or more products for sale as a set is calledA) bundling. B) versioning. C) tie-in sales. D) branding.
Q:
This agency is responsible for investigating complaints of discrimination based on race, religion, sex or age in hiring, promotion, firing, wages, testing, and all other conditions of employment.
A) Environmental Protection Agency
B) Food and Drug Administration
C) Equal Employment Opportunity Commission
D) Federal Trade Commission
Q:
Which of the following is likely among the most concentrated industries in the United States?A) printing and publishing B) soft drinksC) tobacco products D) household vacuum cleaners
Q:
In the above figure for a monopolistically competitive firm, the profit -maximizing output and price are respectivelyA) 80 units and $11. B) 50 units and $8. C) 60 units and $9. D) 60 units and $14.
Q:
Refer to the above figure. Total cost for this firm equalsA) P2. B) P3. C) 0P2bQ1. D) 0P3c Q1.
Q:
A firm that is the only seller of a good with no close substitutes is a(n)A) perfect competitor. B) monopolistic competitor. C) oligopolist. D) monopolist.
Q:
Refer to the above figure. Profits will be negativeA) when the price equals $2. B) when the price is above $2.C) when the price is below $2. D) only when the price equals $1.
Q:
Which of the following statements is true about the planning horizon?A) All inputs are fixed. B) All inputs are variable. C) There are fixed and variable inputs. D) Costs do not exist.
Q:
In the above table, the marginal product of the second worker isA) 68. B) 98.C) 38. D) It cannot be determined.
Q:
Owners face unlimited liability inA) national corporations and global corporations. B) partnerships and corporations.C) proprietorships and corporations. D) proprietorships and partnerships.
Q:
To derive the demand curve for good X, all the following are constant EXCEPT A) the price of good X. B) income.C) the price of good Y. D) tastes and preferences.
Q:
Consumers usually buy fewer units of a good than the quantity that would maximize total utility from consuming the good becauseA) they are not rational. B) of the law of demand.C) they have limited incomes.D) marginal utility becomes zero after just a few units of the good.
Q:
ʺIncome elasticity of demand is always positive.ʺ Do you agree or disagree? Explain.
Q:
A perfectly elastic demand curveA) shows that a slight change in income will lead to a large reduction in price.B) is a horizontal line drawn across from the quantity axis.C) shows that a slight increase in price will reduce quantity demanded to zero.D) has a slope of -1.
Q:
Why are externalities associated with common property rather than private property?
Q:
ʺIt is difficult to compare over time health care expenditures, costs, and output.ʺ Do you agree or disagree? Why?
Q:
All of the following are income in kind EXCEPTA) government provided housing. B) government provided education.C) tips received by a waitress. D) goods produced in the home.
Q:
Suppose that under its collective bargaining agreement, the XYZ Co. can only hire union members in good standing at the time of hiring. XYZ Co. isA) a union shop. B) a closed shop.C) an open shop. D) a company union.
Q:
Which of the following will lead to a decrease in the firmʹs short -run demand for labor?A) An increase in the price of the final productB) An increase in price of the final productʹs substitute goodC) A decline in labor productivityD) An increase in the number of buyers for the final product
Q:
The act of selling an item in slightly altered forms at different prices and to different groups of consumers is known asA) bundling. B) versioning.C) tie-in sales. D) lemons marketing.
Q:
This agency is responsible for regulating the quality and safety of foods, health and medical products, pharmaceuticals, cosmetics, and animal feed.
A) Environmental Protection Agency
B) Food and Drug Administration
C) Equal Employment Opportunity Commission
D) Federal Trade Commission
Q:
If an industry has 25 firms that collectively have $150 million in total sales and the top three firms in this industry account for $78 million in sales and the fifth through twenty -fifth firms account for $60 million in sales, what is the amount of sales for the fourth largest firm?A) $12 million B) $6 millionC) $18 million D) none of the above.
Q:
Refer to the above figure. Which panel represents a monopolistic competitor that is earning zero economic profits?A) Panel A. B) Panel B. C) Panel C. D) Panel D.
Q:
Refer to the above figure. Profits for this firm areA) positive and equal to P2P1ab. B) positive and equal to P3P1ac.C) negative and equal to P3P2bc. D) negative and equal to 0P3c Q1.
Q:
A single supplier of a good or service for which there is no close substitute is referred to as a(n) A) strategic competitor. B) monopoly.C) oligopoly. D) monopolistic competitor.
Q:
Refer to the above figure. The firm will just be covering all of its variable cost but none of its fixed costA) when the price equals $1. B) when the price equals $2.C) when the price equals $4. D) at prices between $1 and $2.
Q:
The planning horizon is theA) long run. B) short run.C) point where production begins.D) point where diminishing marginal product starts.
Q:
In the above table, marginal product becomes negative after employing theA) second worker. B) third worker.C) fourth worker. D) fifth worker.
Q:
In a partnership of two peopleA) each person has 50 percent liability.B) it is more difficult to specialize with two persons than with one. C) each person has unlimited liability.D) the law releases each partner from legal liabilities.
Q:
Use the above figure. The consumerʹs choice changes from YA to YB. Which of the following statements about good Y is true?A) price has increased and the quantity demanded has risen..B) price has decreased and the quantity demanded has risen. C) price has decreased and the quantity demanded has fallen. D) price has increased and the quantity demanded has fallen.
Q:
Quantity of Magazines/WkTotal UtilityQuantity of Paperback Books/WkTotal Utility00001501300290250031203600413046505132567561326680According to utility theory, consumer purchase decisions are made such thatA) the value of the ratio of marginal utility to price for the last units purchased and consumed is equal.B) the difference between the value of the marginal utility of the last unit purchased and the price paid is maximized.C) the total utility of the last unit purchased is equal to the price of that unit.D) the total utility from consuming the good is less than the marginal utility of the last unit consumed.
Q:
Chadʹs income went from $1000 per week to $1500 per week. As a result he increased his consumption of steak from 1 pound a week to 3 pounds a week. Based on his consumption patterns, the income elasticity of steak for Chad isA) 2.50. B) -.50. C) .50. D) -1.50.
Q:
If there is no response in quantity demanded to a change in price, demand isA) perfectly inelastic. B) perfectly elastic.C) elastic. D) unit-elastic.
Q:
What is common property? What does common property have to do with externalities?
Q:
Why have health care costs risen so much in recent years?
Q:
Income in the form of goods and services isA) known as money income. B) known as income in kind.C) not considered income by economists. D) not part of wealth.
Q:
Right-to-work lawsA) make it illegal to require union membership as a condition of continuing employment in a particular firm.B) make it illegal to require a union member to work abroad.C) make it illegal for a state to pass any laws regarding union membership.D) make a closed shop arrangement a legal condition that allows employees to obtain a particular job.
Q:
Which of the following will lead to an outward shift in the firmʹs short -run demand for labor?A) An increase in the price of outputB) Less capital per unit of laborC) A decline in labor productivityD) A reduction in average consumer income
Q:
Which of the following defines monopolization?
A) The Securities and Exchange Commission
B) The Federal Reserve
C) U.S. Supreme Court
D) Federal Trade Commission Act
Q:
This agency is responsible for preventing businesses from engaging in misleading advertising, unfair trade practices, and monopolistic actions, as well as for protecting consumer rights.
A) Environmental Protection Agency
B) Food and Drug Administration
C) Equal Employment Opportunity Commission
D) Federal Trade Commission
Q:
If an industry has 25 firms that collectively have $150 million in total sales and the top four firms in this industry account for $90 million in sales, what is the concentration ratio of the top four firms in this industry?A) 42 percent B) 60 percent C) 70 percent D) 80 percent
Q:
Refer to the above figure. Which of the following statements about panel D in the figure is TRUE?A) The figure represents a long -run equilibrium for a monopolistic competitor.B) The figure represents an industry long -run equilibrium for monopolistic competition.C) The figure is in error since it doesnʹt show the monopolistic competitor making profits in the long run.D) The figure is in error since it has marginal cost intersecting the ATC curve at a point other than the minimum of ATC.
Q:
Refer to the above figure. Profits for this firm areA) negative. B) zero.C) positive.D) undetermined without more information.
Q:
Which of the following regarding a monopolist is INCORRECT?
A) The monopolist is a single supplier of a good or service.
B) The monopolist constitutes the entire industry.
C) Only expensive products are produced by monopolies.
D) There are barriers to entry that allow monopoly.
Q:
Refer to the above figure. Profits will be positiveA) when the price equals $1. B) when the price equals $2.C) at prices between $1 and $2. D) when the price is above $2.
Q:
Which of the following is TRUE for a firm in the long run?A) Variable costs will initially increase and then decrease.B) The law of diminishing marginal product holds. C) All costs are variable costs.D) Variable costs will equal marginal cost at all output levels.
Q:
In the above table, diminishing marginal product occurs after employing theA) first worker. B) second worker.C) third worker. D) fourth worker.
Q:
Unlimited liability is found inA) proprietorships and corporations. B) partnerships and corporations.C) proprietorships and partnerships.D) proprietorships, partnerships, and corporations.
Q:
Use the above figure. The consumerʹs choice changes from Y B to YA. Which of the following statements about good Y is true?A) price has increased and the quantity demanded has risen..B) price has decreased and the quantity demanded has risen..C) price has decreased and the quantity demanded has fallen. D) price has increased and the quantity demanded has fallen.
Q:
Quantity of Magazines/WkTotal UtilityQuantity of Paperback Books/WkTotal Utility00001501300290250031203600413046505132567561326680Refer to the above table. If a consumerʹs optimum consists of 3 magazines and 6 books, thenA) the price of a magazine is six times more than the price of a book.B) the price of a magazine is three times more than the price of a book.C) the price of a book is more than five times more than the price of a magazine.D) the price of a book is six times more than the price of a magazine.
Q:
If your income rises by 15 percent and, as a result, you buy more steak, then steak is a(n)A) substitute. B) normal good. C) complement. D) inferior good.
Q:
If the quantity demanded of a product is the same for each possible price, demand isA) unit-elastic. B) elastic.C) perfectly elastic. D) perfectly inelastic.
Q:
In order for a voluntary agreement to be reached in general, transaction costs should beA) infinite.B) high relative to expected marginal benefits of the agreement. C) low relative to expected marginal benefits of the agreement. D) determined by the Environmental Protection Agency.
Q:
Based on most observations, what are the effects on government budgets from the national health care program?A) Tax revenues will not flow into the new program immediately.B) The federal government ultimately will have to search for ways to reduce its health care expenditures .C) Federal government expenditures on the program are being phased in immediately.D) the federal government ultimately will lower taxes since the programʹs cost will decline over time.
Q:
Income in kind is defined asA) income received in the form of a paycheck. B) payment for services in the form of cash.C) tips.D) income received in the form of goods and services.
Q:
Suppose that under its collective bargaining agreement the XYZ Corp. can hire nonunion workers, but these workers must join the union within 60 days. This agreement is an example ofA) an open shop.B) a closed shop. C) a company union. D) a union shop.
Q:
A short-run increase in the price of a firmʹs output will typically A) lead to a movement along the firmʹs demand for labor curve. B) lead to more employment in the competitive firm.C) not impact the hiring of labor.D) make the demand for labor more inelastic.
Q:
Which of the following defines monopoly?A) Sherman Act B) Clayton ActC) Federal Trade Commission Act D) none of the above