WGU C211 Global Economics

WGU C211 GLOBAL ECONOMICS EXAM WITH 100% CORRECT ANSWERS Suppose that the United States imposes a tariff on avocados imported from Mexico. What impact will this have on the price paid for avocados by United States citizens? - correct answer The price will increase. Which of the following is a consequence of a country imposing a tariff on imported goods? - correct answer The demand for foreign produced goods decreases. Suppose that the United States imposes a tariff on salt. What impact might this tariff have on the price for domestic consumers? - correct answer Consumers will pay a higher price. Applying a tariff to coconuts will have the following effect: - correct answer Increase the domestic price of coconuts. Which of the following is NOT a restriction to trade? - correct answer Free trade areas. What is the significant difference between an import quota and a tariff? - correct answer A tariff raises revenue for the government and an import quota creates surplus for those who obtain licenses to import. Suppose that the price of a good increases (all else held constant). Which of the following would happen along with the change in price? - correct answer Consumer surplus would decrease. Suppose that Bob goes to the market and is 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? - correct answer His consumer surplus is $100. Which statement is true of consumer surplus? - correct answer Consumer surplus represents value to buyers in excess of the price paid for the product. Which statement is true? - correct answer 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, 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? - correct answer U.S. GNP and Mexico's GDP. Which of the following statements describes gross domestic product (GDP)? - correct answer GDP is the most used measure of a country's economic wellbeing. Which of the following is an investment included in the gross domestic product (GDP) measure? - correct answer Spending on new residential construction. Gross Domestic Product (GDP) measures which of the following? - correct answer Market value of final goods and services produced within a country in a given period of time. Which item is NOT part of GDP? - correct answer Purchasing a used hairdryer. What is the key distinction between real and nominal GDP? - correct answer Real GDP measures production not 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 equation? - correct answer Marginal cost multiplied by change in quantity. Fixed costs equal: - correct answer Total costs minus variable costs Economic profit is distinct from accounting profit because: - correct answer Economic profit incorporates both explicit and implicit costs. Total costs include: - correct answer Variable costs plus fixed costs. Marginal costs consider: - correct answer The increase in total cost arising from an extra unit of production. What response best describes the relationship between marginal costs and total costs? - correct answer Whenever marginal cost is less than average total cost, average total cost is falling. Which statement is true about productivity? - correct answer The value of marginal product of labor equals wage in a competitive firm. A production function expresses the relationship between: - correct answer Quantity of resource inputs and product/service outputs. Opportunity costs include: - correct answer The income the entrepreneur could have earned working for an employer. Economists and decision makers study and then make decisions or judgments based on (select best answer): - correct answer Marginal analysis. The primary reason that the marginal cost curve declines and then increases is: - correct answer Firms experience increasing marginal product, then diminishing marginal product. Which of the following statements is accurate? - correct answer Marginal costs eventually rise with the quantity of output. Consider the following example: A perfectly 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? - correct answer Decrease the target output. A competitive firm is characterized by: - correct answer Trading of identical products. Competitive firms experience marginal revenue that is: - correct answer Equal to price. In the short-run, a competitive firm would continue to produce under the following circumstance: - correct answer Total revenue exceeds total variable