WGU C211 Global Economics - Study Guide & Practice Questions
Suppose that the United States imposes a The price will increase.
tariff on avocados imported from Mexico.
What impact will this have on the price paid
for avocados by United States citizens?
Which of the following is a consequence of a The demand for foreign produced goods
country imposing a tariff on imported goods? decreases.
Suppose that the United States imposes a Consumers will pay a higher price.
tariff on salt. What impact might this tariff
have on the price for domestic consumers?
Applying a tariff to coconuts will have the Increase the domestic price of
following effect: coconuts.
Which of the following is NOT a restriction to Free trade areas.
trade?
What is the significant difference between an A tariff raises revenue for the
import quota and a tariff? government and an import quota creates surplus for
those who obtain licenses to import.
Suppose that the price of a good increases (all Consumer surplus would decrease.
else held constant). Which of the following
would happen along with the change in price?
Suppose that Bob goes to the market and is His consumer surplus is $100.
willing to pay $500 for a new chainsaw. Bob is
able to find the chainsaw for only $400. Which
of the following follows from Bob's
circumstance?
Which statement is true of consumer surplus? Consumer surplus represents value to
buyers in excess of the price paid for the product.
Which statement is true? Total surplus is the sum of consumer and
producer surplus and is graphically represented as the
area between the supply and demand curves up to the
equilibrium quantity.
Suppose that Bob lives in the United States, U.S. GNP and Mexico's GDP.
but has been working in Mexico for the last 5 years. Where
is the value of Bob's production
counted during the last 5 years?
Which of the following statements describes GDP is the most used measure of a
gross domestic product (GDP)? country's economic wellbeing.
Which of the following is an investment Spending on new residential
included in the gross domestic product (GDP) construction.
measure?
Gross Domestic Product (GDP) measures Market value of final goods and services
which of the following? produced within a country in a given period of time.
Stuvia 2026-2027
, WGU C211 Global Economics - Study Guide & Practice Questions
Which item is NOT part of GDP? Purchasing a used hairdryer.
What is the key distinction between real and Real GDP measures production not
nominal GDP? affected by changes in prices while nominal GDP
measures production measured at current prices.
What is the change in total cost equal to in the Marginal cost multiplied by change in
marginal cost equation? quantity.
Fixed costs equal: Total costs minus variable costs
Economic profit is distinct from accounting Economic profit incorporates both explicit
profit because: and implicit costs.
Total costs include: Variable costs plus fixed costs.
Marginal costs consider: The increase in total cost arising from an
extra unit of production.
What response best describes the relationship Whenever marginal cost is less than
between marginal costs and total costs? average total cost, average total cost is falling.
Which statement is true about productivity? The value of marginal product of labor
equals wage in a competitive firm.
A production function expresses the Quantity of resource inputs and
relationship between: product/service outputs.
Opportunity costs include: The income the entrepreneur could have
earned working for an employer.
Economists and decision makers study and Marginal analysis.
then make decisions or judgments based on
(select best answer):
The primary reason that the marginal cost Firms experience increasing marginal
curve declines and then increases is: product, then diminishing marginal product.
Which of the following statements is Marginal costs eventually rise with the
accurate? quantity of output.
Stuvia 2026-2027
, WGU C211 Global Economics - Study Guide & Practice Questions
Consider the following example: A perfectly Decrease the target output.
competitive firm finds that at current
production levels marginal cost is greater
than marginal revenue. What action should
this firm take in order to pursue the
maximization of profit?
A competitive firm is characterized by: Trading of identical products.
Competitive firms experience marginal Equal to price.
revenue that is:
In the short-run, a competitive firm would Total revenue exceeds total variable
continue to produce under the following costs.
circumstance:
What fundamental shape does a demand Horizontal.
curve take in a competitive market?
For a perfectly competitive firm which The demand curve is the same as the
condition is true? marginal revenue curve.
Which condition is true for perfectly They will exit the market if total
competitive firms in the long-run? revenue is less than total costs.
Which statement is true concerning marginal Marginal costs typically decline and
costs? then increase with the quantity of output.
What rule is used by perfectly competitive Price is less than average variable
firms to determine shut-down in the shortrun? costs.
What is true of perfectly competitive firms in Economic profits will not be achievable.
the long-run?
What two market structures have common Perfect competition and monopolistic
profit characteristics in the long run? competition.
Consider the structure/shape of the demand The monopoly's demand curve is
curve for the various firm types. In what way downward sloping and the competitive firm's demand
does a monopoly's demand curve differ from a curve is horizontal.
perfectly competitive firm's demand curve?
Monopolistic firms seek to maximize profit. When marginal revenue equals marginal
What condition allows them to achieve this cost.
goal?
In pursuing the maximization of profit, Above marginal cost.
monopolies set price at a point that is:
Stuvia 2026-2027
Suppose that the United States imposes a The price will increase.
tariff on avocados imported from Mexico.
What impact will this have on the price paid
for avocados by United States citizens?
Which of the following is a consequence of a The demand for foreign produced goods
country imposing a tariff on imported goods? decreases.
Suppose that the United States imposes a Consumers will pay a higher price.
tariff on salt. What impact might this tariff
have on the price for domestic consumers?
Applying a tariff to coconuts will have the Increase the domestic price of
following effect: coconuts.
Which of the following is NOT a restriction to Free trade areas.
trade?
What is the significant difference between an A tariff raises revenue for the
import quota and a tariff? government and an import quota creates surplus for
those who obtain licenses to import.
Suppose that the price of a good increases (all Consumer surplus would decrease.
else held constant). Which of the following
would happen along with the change in price?
Suppose that Bob goes to the market and is His consumer surplus is $100.
willing to pay $500 for a new chainsaw. Bob is
able to find the chainsaw for only $400. Which
of the following follows from Bob's
circumstance?
Which statement is true of consumer surplus? Consumer surplus represents value to
buyers in excess of the price paid for the product.
Which statement is true? Total surplus is the sum of consumer and
producer surplus and is graphically represented as the
area between the supply and demand curves up to the
equilibrium quantity.
Suppose that Bob lives in the United States, U.S. GNP and Mexico's GDP.
but has been working in Mexico for the last 5 years. Where
is the value of Bob's production
counted during the last 5 years?
Which of the following statements describes GDP is the most used measure of a
gross domestic product (GDP)? country's economic wellbeing.
Which of the following is an investment Spending on new residential
included in the gross domestic product (GDP) construction.
measure?
Gross Domestic Product (GDP) measures Market value of final goods and services
which of the following? produced within a country in a given period of time.
Stuvia 2026-2027
, WGU C211 Global Economics - Study Guide & Practice Questions
Which item is NOT part of GDP? Purchasing a used hairdryer.
What is the key distinction between real and Real GDP measures production not
nominal GDP? affected by changes in prices while nominal GDP
measures production measured at current prices.
What is the change in total cost equal to in the Marginal cost multiplied by change in
marginal cost equation? quantity.
Fixed costs equal: Total costs minus variable costs
Economic profit is distinct from accounting Economic profit incorporates both explicit
profit because: and implicit costs.
Total costs include: Variable costs plus fixed costs.
Marginal costs consider: The increase in total cost arising from an
extra unit of production.
What response best describes the relationship Whenever marginal cost is less than
between marginal costs and total costs? average total cost, average total cost is falling.
Which statement is true about productivity? The value of marginal product of labor
equals wage in a competitive firm.
A production function expresses the Quantity of resource inputs and
relationship between: product/service outputs.
Opportunity costs include: The income the entrepreneur could have
earned working for an employer.
Economists and decision makers study and Marginal analysis.
then make decisions or judgments based on
(select best answer):
The primary reason that the marginal cost Firms experience increasing marginal
curve declines and then increases is: product, then diminishing marginal product.
Which of the following statements is Marginal costs eventually rise with the
accurate? quantity of output.
Stuvia 2026-2027
, WGU C211 Global Economics - Study Guide & Practice Questions
Consider the following example: A perfectly Decrease the target output.
competitive firm finds that at current
production levels marginal cost is greater
than marginal revenue. What action should
this firm take in order to pursue the
maximization of profit?
A competitive firm is characterized by: Trading of identical products.
Competitive firms experience marginal Equal to price.
revenue that is:
In the short-run, a competitive firm would Total revenue exceeds total variable
continue to produce under the following costs.
circumstance:
What fundamental shape does a demand Horizontal.
curve take in a competitive market?
For a perfectly competitive firm which The demand curve is the same as the
condition is true? marginal revenue curve.
Which condition is true for perfectly They will exit the market if total
competitive firms in the long-run? revenue is less than total costs.
Which statement is true concerning marginal Marginal costs typically decline and
costs? then increase with the quantity of output.
What rule is used by perfectly competitive Price is less than average variable
firms to determine shut-down in the shortrun? costs.
What is true of perfectly competitive firms in Economic profits will not be achievable.
the long-run?
What two market structures have common Perfect competition and monopolistic
profit characteristics in the long run? competition.
Consider the structure/shape of the demand The monopoly's demand curve is
curve for the various firm types. In what way downward sloping and the competitive firm's demand
does a monopoly's demand curve differ from a curve is horizontal.
perfectly competitive firm's demand curve?
Monopolistic firms seek to maximize profit. When marginal revenue equals marginal
What condition allows them to achieve this cost.
goal?
In pursuing the maximization of profit, Above marginal cost.
monopolies set price at a point that is:
Stuvia 2026-2027
