TEST BANK FOR Managerial Economics, 9th Edition By William F Samuelson

TEST BANK FOR Managerial Economics, 9th Edition Wi
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lliam F. Samuelson, Stephen G. Marks, Jay L. Zagorsk
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File:tyCh01;tyCHAPTERty1:tyIntroductiontytotyEconomictyDecisiontyMaki

ngtyMULTIPLEtyCHOICE

1. Managerialtyeconomicstycantybesttybetydefinedtyastythe:
a) macroeconomicstyandtymicroeconomicstyfortymanagers.
b) studytyoftyeconomictyincentivestyontyconsumertybehaviortyandtydemand.
c) analysistyoftythetylabortymarkettythroughtythetybehaviortyoftyworkerstyandtymanagers.
d) analysistyoftymajortymanagementtydecisionstyusingtyeconomictytools.
e) studytyoftythetystrategictyinteractiontybetweentyfirmstyintyatymarket.

ANSWER:tyd
SECTIONtyREFERENCE:tyIntroductionty
DIFFICULTYtyLEVEL:tyEasy



2. Whichtyoftythetyfollowingtyistynottyonetyoftythetystepstyintymanagerialtydecisiontymaking?
a) Predictingtythetyconsequencestyoftyatydecision.
b) Exploringtythetyalternativestytotythetydecision.
c) Definingtythetyproblemtyandtythetyobjectivestyoftythetydecision.
d) Negotiatingtyatyconsensustytotyimplementtythetydecision.
e) Performingtysensitivitytyanalysis.

ANSWER:tyd
SECTIONtyREFERENCE:tySixtyStepstytotyDecisiontyMakingtyDIFFIC
ULTYtyLEVEL:tyEasy



3. Profittymaximizationtyistyantyambiguoustyguidetytotydecisiontymakingtyintythetyprivatetysectortybecaus
e:
a) firmstyintythetyprivatetysectortyusuallytydotynottyaimtyattyprofittymaximization.
b) thetygoaltyoftyprofittymaximizationtycontradictstythetygoaltyoftysatisfyingtythetyfirm‘styshareholders.
c) oftythetypresencetyoftyrisktyandtyuncertainty.
d) profit-maximizationtyignorestysocialtycoststyandtybenefits.
e) Nonetyoftythetyabovetyanswerstyistycorrect.

ANSWER:tyc
SECTIONtyREFERENCE:tySixtyStepstytotyDecisiontyMakingtyDIFFIC
ULTYtyLEVEL:tyEasy

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,4. Whichtyoftythetyfollowingtyistytruetyoftyeconomictymodels?
a) Modelstyaretytootytheoreticaltytotybetyapplicabletyintyrealtyworldtydecisions.
b) Modelstyaretynottyusefultybecausetyuncertaintytypreventstyaccuratetyforecasts.
c) Modelstyaretysimplifiedtydescriptionstyoftyprocesses,tyrelationships,tyortyothertyphenomena.
d) Modelstydescribetyrealtyworldtysituationstyintycompletetydetail.
e) Modelstyaretynottyusefultybecausetytheytydotynottytaketyintotyaccounttycomplicatingtyan
dtylesstyimportanttyfeaturestyoftyatyproblem.

ANSWER:tyc
SECTIONtyREFERENCE:tySixtyStepstytotyDecisiontyMakingtyDIFFIC
ULTYtyLEVEL:tyMedium



5. Whichtyoftythetyfollowingtycorrectlytydescribestyatydeterministictyeconomictymodel?
a) Atydeterministictymodeltyistyatymodeltyfortywhichtythetyoutcometyistypredictedtywithtycertainty.
b) Atydeterministictymodeltycantyonlytybetyusedtytotyexplaintyshort-runtyeconomictyphenomena.
c) Atydeterministictymodeltyistymosttyusefultyintyidentifyingtylong-termtytrends.
d) Atydeterministictymodeltyistyusedtyintythetystudytyoftynormativetyeconomics.
e) Thetyoutcometyoftyatydeterministictymodeltyistyrandomtyandtyhastyprobabilitiestyattached.

ANSWER:tya
SECTIONtyREFERENCE:tySixtyStepstytotyDecisiontyMakingtyDIFFIC
ULTYtyLEVEL:tyEasy



6. Whichtyoftythetyfollowingtycorrectlytyexplainstyatyprobabilistictymodel?
a) Atyprobabilistictymodeltygivestyatydescriptiontyoftyrealtyworldtyeconomictyphenomena.
b) Atyprobabilistictymodeltyshowstythetypossibilitytyoftyatyrangetyoftyoutcomes.
c) Atyprobabilistictymodeltyexaminestythetychangestyintyeconomictyvariablestyovertyatyperiodtyoftytim
e.
d) Atyprobabilistictymodeltyistybasedtyontyvaluetyjudgments.
e) Atyprobabilistictymodeltyistyusedtytotyexplaintylong-runtyeconomictyphenomena

ANSWER:tyb
SECTIONtyREFERENCE:tySixtyStepstytotyDecisiontyMakingtyDIFFIC
ULTYtyLEVEL:tyEasy



7. Maximizingtyprofittybytyenumeratingtythetyprofittyoutcomestyoftydifferenttycoursestyoftyaction
a) Istyonlytyapplicabletytotyproblemstywithtyatysmalltynumbertyoftyalternatives.
b) Becomestyincreasinglytycostlytyastythetynumbertyoftychoicestyincrease.
c) Alwaystydiscoverstythetybesttypossibletychoice.

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, d) Providestyatyusefultyshortcuttytotyfindingtythetyoptimaltychoice.
e) Answerstybtyandtyctyaretybothtycorrect.

ANSWER:tyb
SECTIONtyREFERENCE:tySixtyStepstytotyDecisiontyMakingtyDIFFIC
ULTYtyLEVEL:tyMedium



8. Atybeveragestycompanytywantstytotylaunchtyatynewtydiettysodatyaimedtyattydiabeticstyandtyhea
lth-tyconscioustycustomers.tyIttywilltyusetyaty
economictymodeltytotyidentifytyitstytargettycustome
rs.
a) deterministic
b) dynamic
c) qualitative
d) stochastic
e) probabilistic

ANSWER:tya
SECTIONtyREFERENCE:tySixtyStepstytotyDecisiontyMakingtyDIFFIC
ULTYtyLEVEL:tyMedium



9. Giventythattythetymarkettysharetyoftyatyfirmtydependstyontymanytyunpredictabletyfactors,tyatyfirmty
willtyusetyaty economictymodeltytotyestimatetythetymarkettysharetyfortyonetyoftyitstyproducts.
a) deterministic
b) dynamic
c) qualitative
d) probabilistic
e) comparativetystatics

ANSWER:tyd
SECTIONtyREFERENCE:tySixtyStepstytotyDecisiontyMakingtyDIFFIC
ULTYtyLEVEL:tyMedium



10. Sensitivitytyanalysistyistyusedtybytyatyfirmtyto:
a) analyzetythetyimpacttyoftyatychangetyintythetypricetyoftythetygoodtyontythetydemandtyfortythetygood.
b) examinetythetystatictyeffectstyoftyantyeconomictydecisiontyontythetyfirm‘styprofitability.
c) analyzetythetysocialtycoststyandtybenefitstyoftyantyeconomictydecision.
d) examinetythetyopportunitytycoststyoftyantyeconomictydecision.
e) examinetyhowtyantyoptimaltydecisiontyistyaffectedtyiftykeytyeconomictyfactstyvary.

ANSWER:tye
SECTIONtyREFERENCE:tySixtyStepstytotyDecisiontyMaking
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, DIFFICULTYtyLEVEL:tyEasy



11. Atycosmeticstycompanytyistyconductingtyatysecond-
yeartyreviewtyoftyonetyoftyitstynewesttyproducts.tyThetymarketingtydepartmenttyexpectstythattythety
firmtywilltycontinuetytotyearntyprofitstyfromtythetysaletyoftythetyproducttyintythetythirdtyyeartyastyitty
didtyintythetypasttytwotyyears.tySeniortymanagement,tyhowever,tyfeelstythattythetyprofittyprojectio
nstywouldtyvarytybasedtyontyothertyfactorstysuchtyastythetypricetyoftythetycompetitor'styproducts,tyt
hetyactualtyleveltyoftysales,tyandtythetypossibilitytyoftycosttyreductions.tyIntyothertywords,tythetyse
niortymanagementtyistyundertakingty .
a) atysensitivitytyanalysis
b) antyenumerationtystudy
c) atybenefit-costtyanalysis
d) atycontingenttyvaluationtystudy
e) atystrategictyanalysis

ANSWER:tya
SECTIONtyREFERENCE:tySixtyStepstytotyDecisiontyMakingtyDIFFIC
ULTYtyLEVEL:tyMedium



12. Accordingtytotythetysatisficingtymodeltyoftymanagementtybehavior,tythetygoaltyoftyatyfirmtyistyto:
a) satisfytycustomers,tyemployees,tyandtyshareholders.
b) maximizetythetygaintytotysocietytyandtynottyjusttytotyshareholders.
c) achievetyatysatisfactorytyleveltyoftyperformancetyagainsttyatybenchmark.
d) maximizetysalestyrevenuetyandtynottynecessarilytythetyvaluetyoftythetyfirm.
e) maximizetyitstymarkettysharetyeventyattythetycosttyoftyprofit.

ANSWER:tyc
SECTIONtyREFERENCE:tyPrivatetyandtyPublictyDecisions:tyAntyEconomictyViewtyDIFFICU
LTYtyLEVEL:tyEasy



13. Accordingtytotythetytheorytyoftythetyfirm,tythetymanagement‘styultimatetyobjectivetyistyto:
a) maximizetyshort-termtyprofit,tyeventyiftythistysacrificestylong-termtyprofit.
b) maximizetythetyvaluetyoftythetyfirm.
c) increasetyproductiontytotythetyhighesttypossibletylevel.
d) increasetythetymarkettysharetyoftythetyfirm.
e) diversifytyintotyastymanytyproducttylinestyastythetyfirmtycan.

ANSWER:tyb
SECTIONtyREFERENCE:tyPrivatetyandtyPublictyDecisions:tyAntyEconomictyViewtyDIFFICU
LTYtyLEVEL:tyEasy



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