TEST BANK FOR Managerial Economics: Analysis and Management 10th Edition by William F. Samuelson, Stephen G. Mark ISBN:978-1394268108 COMPLETE GUIDE ALL CHAPTERS COVERED 100% VERIFIED A+ GRADE ASSURED!!!!NEW LATEST UPDATE!!!!!

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Managerial Economics, 10th Edition William F. Samuelson, Stephen G. Marks, Jay L. Zagorsk
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y Chapter 1-17
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File: Ch01; CHAPTER 1: Introduction to Economic Decision Making
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MULTIPLE CHOICE ma




1. Managerial economics can best be defined as the:
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a) macroeconomics and microeconomics for managers. ma ma ma ma



b) study of economic incentives on consumer behavior and demand.
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c) analysis of the labor market through the behavior of workers and managers.
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d) analysis of major management decisions using economic tools.
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e) study of the strategic interaction between firms in a market.
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ANSWER: d ma



SECTION REFERENCE: Introduction DI ma ma ma



FFICULTY LEVEL: Easy ma ma




2. Which of the following is not one of the steps in managerial decision making?
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a) Predicting the consequences of a decision. ma ma ma ma ma



b) Exploring the alternatives to the decision. ma ma ma ma ma



c) Defining the problem and the objectives of the decision.
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d) Negotiating a consensus to implement the decision. ma ma ma ma ma ma



e) Performing sensitivity analysis. ma ma




ANSWER: d ma



SECTION REFERENCE: Six Steps to Decision Making DIFFICUL
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TY LEVEL: Easy
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3. Profit maximization is an ambiguous guide to decision making in the private sector because:
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a) firms in the private sector usually do not aim at profit maximization.
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b) the goal of profit maximization contradicts the goal of satisfying the firm’s shareholders.
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c) of the presence of risk and uncertainty.
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d) profit-maximization ignores social costs and benefits. ma ma ma ma ma



e) None of the above answers is correct.
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ANSWER: c ma



SECTION REFERENCE: Six Steps to Decision Making DIFFICUL
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TY LEVEL: Easy
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,4. Which of the following is true of economic models?
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a) Models are too theoretical to be applicable in real world decisions.
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b) Models are not useful because uncertainty prevents accurate forecasts.
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c) Models are simplified descriptions of processes, relationships, or other phenomena.
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d) Models describe real world situations in complete detail.
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e) Models are not useful because they do not take into account complicating and les
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s important features of a problem.
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ANSWER: c ma



SECTION REFERENCE: Six Steps to Decision Making DIFFICUL
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TY LEVEL: Medium
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5. Which of the following correctly describes a deterministic economic model?
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a) A deterministic model is a model for which the outcome is predicted with certainty.
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b) A deterministic model can only be used to explain short-run economic phenomena.
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c) A deterministic model is most useful in identifying long-term trends.
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d) A deterministic model is used in the study of normative economics.
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e) The outcome of a deterministic model is random and has probabilities attached.
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ANSWER: a ma



SECTION REFERENCE: Six Steps to Decision Making DIFFICUL
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TY LEVEL: Easy
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6. Which of the following correctly explains a probabilistic model?
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a) A probabilistic model gives a description of real world economic phenomena.
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b) A probabilistic model shows the possibility of a range of outcomes.
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c) A probabilistic model examines the changes in economic variables over a period of time.
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d) A probabilistic model is based on value judgments.
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e) A probabilistic model is used to explain long-run economic phenomena
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ANSWER: b ma



SECTION REFERENCE: Six Steps to Decision Making DIFFICUL
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TY LEVEL: Easy
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7. Maximizing profit by enumerating the profit outcomes of different courses of action
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a) Is only applicable to problems with a small number of alternatives.
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b) Becomes increasingly costly as the number of choices increase.
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c) Always discovers the best possible choice.
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d) Provides a useful shortcut to finding the optimal choice.
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e) Answers b and c are both correct.
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, ANSWER: b ma



SECTION REFERENCE: Six Steps to Decision Making DIFFICUL
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TY LEVEL: Medium
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8. A beverages company wants to launch a new diet soda aimed at diabetics and health-
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conscious customers. It will use a
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a) deterministic
b) dynamic
c) qualitative
d) stochastic
e) probabilistic

ANSWER: a ma



SECTION REFERENCE: Six Steps to Decision Making DIFFICUL
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TY LEVEL: Medium
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9. Given that the market share of a firm depends on many unpredictable factors, a firm will us
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ea ma economic model to estimate the market share for one of its products.
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a) deterministic
b) dynamic
c) qualitative
d) probabilistic
e) comparative statics ma




ANSWER: d ma



SECTION REFERENCE: Six Steps to Decision Making DIFFICUL
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TY LEVEL: Medium
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10. Sensitivity analysis is used by a firm to:
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a) analyze the impact of a change in the price of the good on the demand for the good.
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b) examine the static effects of an economic decision on the firm’s profitability.
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c) analyze the social costs and benefits of an economic decision.
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d) examine the opportunity costs of an economic decision.
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e) examine how an optimal decision is affected if key economic facts vary.
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ANSWER: e ma



SECTION REFERENCE: Six Steps to Decision Making DIFFICUL
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TY LEVEL: Easy
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