ECON 1580 GRADED QUIZ AND FINAL EXAMS ANSWERS AVAILABLE

ECON 1580 GRADED QUIZ AND FINAL EXAMS ANSWERS AVAILABE Question 1 Correct Mark 1.00 out of 1.00 Flag question Question text According to the textbook, economics is a: Select one: a. social science. b. study of business decisions, not social decisions. c. part of operations and management science. d. part of humanities. Feedback The correct answer is: social science. Question 2 Correct Mark 1.00 out of 1.00 Flag question Question text A/an does not pose the problem of scarcity; one use of the good is not an alternative to another use. Select one: a. free good b. scarce good c. economic good d. monetary good Feedback The correct answer is: free good Question 3 Correct Mark 1.00 out of 1.00 Flag question Question text Water is considered a scarce good rather than a free good because: Select one: a. it has alternative uses. b. it does not have alternative uses. c. scarce goods are less expensive than free goods. d. free goods are more expensive than scarce goods. Feedback The correct answer is: it has alternative uses. Question 4 Correct Mark 1.00 out of 1.00 Flag question Question text The Case in Point on the oil extraction suggests that one reason oil may become more costly is that: Select one: a. we will have to give up more and more valuable alternatives to extract oil. b. speculation is likely to drive up oil prices. c. oil producers are likely to become more greedy in the future. d. actually, the Case suggests that oil extraction is likely to become less costly and the future. Feedback The correct answer is: we will have to give up more and more valuable alternatives to extract oil. Question 5 Correct Mark 1.00 out of 1.00 Flag question Question text The opportunity cost of something is: Select one: a. greater during periods of rising prices. b. equal to the money cost. c. less during periods of falling prices. d. what is given up to acquire it. Feedback The correct answer is: what is given up to acquire it. Question 6 Correct Mark 1.00 out of 1.00 Flag question Question text The BEST example of making a choice at the margin is: Select one: a. buying a new car. b. quitting your job. c. a coffee drinker drinking another cup of coffee. d. attending college. Feedback The correct answer is: a coffee drinker drinking another cup of coffee. Question 7 Correct Mark 1.00 out of 1.00 Flag question Question text The study of a single firm and how it determines prices would fall under: Select one: a. macroeconomics. b. microeconomics. c. the study of inflation. d. normative economics. Feedback The correct answer is: microeconomics. Question 8 Correct Mark 1.00 out of 1.00 Flag question Question text Each of the following statements about the use of models in the study of economics is true EXCEPT: Select one: a. models fit the observed facts exactly. b. models are sometimes revised in light of new research findings. c. models are easier to manipulate than the reality they represent. d. models contain the essential features of the economic behavior being studied. Feedback The correct answer is: models fit the observed facts exactly. Question 9 Correct Mark 1.00 out of 1.00 Flag question Question text Suppose you observe that the sun sets every evening after the six o'clock business report. If you conclude that the six o'clock business report makes the sun set, you are guilty of the fallacy of: Select one: a. division. b. composition. c. false cause. d. science. Feedback The correct answer is: false cause. Question 10 Correct Mark 1.00 out of 1.00 Flag question Question text An example of a normative statement is: Select one: a. The rate of unemployment is 4 percent. b. A high rate of economic growth creates more jobs for the country. c. The federal government spends half of its budget on national defense. d. Everyone in the country needs to be covered by national health insurance. Feedback The correct answer is: Everyone in the country needs to be covered by national health insurance. z t Started on Tuesday, 1 February 2022, 8:14 PM State Finished Completed on Tuesday, 1 February 2022, 8:15 PM Time taken 1 min 25 secs Grade 10.00 out of 10.00 (100%) Question 1 Correct Mark 1.00 out of 1.00 Flag question Question text Resources from nature that can be used to to produce other goods and services are called: Select one: a. money. b. natural resources. c. labor. d. capital. Question 2 Correct Mark 1.00 out of 1.00 Flag question Question text Increasing the level of education in the United States will: Select one: a. shift the production possibilities curve to the left. b. improve the level of technology. c. lead to increased natural resource use. d. lead to workers possessing greater human capital. Question 3 Correct Mark 1.00 out of 1.00 Flag question Question text Technology is: Select one: a. knowledge that can be applied to the production of goods and services. b. generally unlimited in modern economies. c. a graphical illustration of the alternative combinations of goods and services an economy can produce. d. the resources the economy has available to produce goods and services. Question 4 Correct Mark 1.00 out of 1.00 Flag question Question text A person who seeks to earn profits by finding ways to organize factors of production is called a/an: Select one: a. foreman b. finance capitalist. c. entrepreneur. d. manager. Question 5 Correct Mark 1.00 out of 1.00 Flag question Question text In this exhibit (Guns and Butter), the combination of guns and butter at point H: Select one: a. can be obtained, but would cost too much. b. cannot be attained given the level of technology and the factors of production available. c. has no meaning since it does not relate to the preferences of consumers. d. Is attainable but would increase unemployment. Question 6 Correct Mark 1.00 out of 1.00 Flag question Question text If the production possibilities curve were a straight line sloping down from left to right, this would suggest that: Select one: a. more of both goods could be produced moving along the curve. b. the two products must have the same price. c. no factor of production has any particular comparative advantage over other resources. d. the utility of the two goods must be equal to consumers. Question 7 Correct Mark 1.00 out of 1.00 Flag question Question text When moving along a production possibilities curve, the opportunity cost to society of getting more of the good on the horizontal axis: Select one: a. is constant. b. is measured in dollar terms. c. is measured by the amount of the other good that must be given up. d. usually decreases. Question 8 Correct Mark 1.00 out of 1.00 Flag question Question text Efficient production implies that it is: Select one: a. possible to produce more of all goods and services. b. it is possible to produce more of one good without producing less of another. c. not possible to produce more of one good without producing less of another good. d. producing at a combination of goods which lies between the production possibilities curve and the origin. Question 9 Correct Mark 1.00 out of 1.00 Flag question Question text In market capitalism: Select one: a. factors of production are privately owned and decisions are made privately. b. factors of production are owned by the government but decisions are made privately. c. there is no role for government. d. the consumer has few choices to make. Question 10 Correct Mark 1.00 out of 1.00 Flag question Question text Government's role of taxing some citizens and transferring income to others is considered: Select one: a. enforcing a legal system. b. providing certain goods and services. c. redistributing income. d. maintaining the money supply. Started on Tuesday, 8 February 2022, 8:41 AM State Finished Completed on Tuesday, 8 February 2022, 8:45 AM Time taken 3 mins 28 secs Grade 10.00 out of 10.00 (100%) Question 1 Correct Mark 1.00 out of 1.00 Flag question Question text The law of demand implies that: Select one: a. consumers are not responsive to price changes. b. consumers will, all other things unchanged, buy more at lower prices. c. sellers will, all other things unchanged, offer more on the market at higher prices. d. sellers will, all other things unchanged, offer less on the market at lower prices. Question 2 Correct Mark 1.00 out of 1.00 Flag question Question text A decrease in the price of eggs, all other things unchanged, will result in a/an: Select one: a. increase in the demand for eggs. b. increase in the supply of eggs. c. greater quantity of eggs supplied. d. greater quantity of eggs demanded. Question 3 Correct Mark 1.00 out of 1.00 Flag question Question text The price of oranges falls. What happens in the market for apples, which are a substitute for oranges? Select one: a. The equilibrium price falls and the equilibrium quantity rises. b. The equilibrium price rises and the equilibrium quantity falls. c. The equilibrium price and quantity rise. d. The equilibrium price and quantity fall. Question 4 Correct Mark 1.00 out of 1.00 Flag question Question text After graduation from college you will receive a substantial increase in your income from a new job. If you decide that you will purchase more T-bone steak and less hamburger, then for you hamburger would be considered a/an: Select one: a. normal good. b. substitute good. c. complementary good. d. inferior good. Question 5 Correct Mark 1.00 out of 1.00 Flag question Question text The primary difference between a change in supply and a change in the quantity supplied is: Select one: a. a change in quantity supplied is a shift in the supply curve, and a change in supply is a movement along the supply curve. b. both a change in quantity supplied and a change in supply are movements along the supply curve, only in different directions. c. a change in quantity supplied is a movement along the supply curve, and a change in supply is a shift of the supply curve. d. a change in supply is a movement to the left along the supply curve and a change in quantity supplied is a movement to the right along the supply curve. Question 6 Correct Mark 1.00 out of 1.00 Flag question Question text If the price of a commodity increases as the result of increased demand, you would expect the: Select one: a. supply to increase. b. quantity supplied to increase. c. quantity supplied to decrease. d. supply curve to shift to the right. Question 7 Correct Mark 1.00 out of 1.00 Flag question Question text In this exhibit (demand and supply curves), the highest price per unit that buyers would be willing to pay for 250 units is: Select one: a. $0. b. $5. c. $10. d. $15. Question 8 Correct Mark 1.00 out of 1.00 Flag question Question text In this exhibit (demand and supply curves), a price of $25 per unit will result in: Select one: a. a surplus of 50 units. b. a surplus of 200 units. c. a surplus of 250 units. d. quantity demanded exceeding quantity supplied. Question 9 Correct Mark 1.00 out of 1.00 Flag question Question text If the price in the market for a commodity is above the market equilibrium price, the: Select one: a. price will remain unchanged. b. price will rise to clear the market. c. quantity supplied exceeds the quantity demanded. d. quantity demanded exceeds the quantity supplied. Question 10 Correct Mark 1.00 out of 1.00 Flag question Question text A market shortage occurs if the: Select one: a. price is above the equilibrium price. b. price is equal to the equilibrium price. c. equilibrium price is above the market price. d. equilibrium price is below the market price. t Started on Tuesday, 8 February 2022, 8:11 PM State Finished Completed on Tuesday, 8 February 2022, 8:14 PM Time taken 3 mins 7 secs Grade 10.00 out of 10.00 (100%) Question 1 Correct Mark 1.00 out of 1.00 Flag question Question text If the price of chocolate-covered peanuts decreases from $1.10 to $0.90 and the quantity demanded does not change, this indicates that, if other things are unchanged, the price elasticity of demand is: Select one: a. 0. b. -0.5. c. -1. d. -2. Question 2 Correct Mark 1.00 out of 1.00 Flag question Question text If the price elasticity of demand is found to be -3/4, then demand is: Select one: a. price inelastic. b. price elastic. c. unit price elastic. d. positively sloped. Question 3 Correct Mark 1.00 out of 1.00 Flag question Question text If total revenue goes down when price falls, the price elasticity of demand is said to be: Select one: a. price inelastic. b. unit price elastic. c. price elastic. d. positive. Question 4 Correct Mark 1.00 out of 1.00 Flag question Question text The demand for agricultural output is price inelastic. This means that if farmers, taken collectively, have a bumper crop, they will experience: Select one: a. lower prices, greater quantities sold, and lower incomes. b. higher prices, greater quantities sold, and higher incomes. c. lower prices, quantities sold, and incomes. d. higher prices, quantities sold, and incomes. Question 5 Correct Mark 1.00 out of 1.00 Flag question Question text In this exhibit (Demand for Bungalow Bob's Bagels) total revenue remains unchanged if the price from . Select one: a. decreases; $0.50 to $0.40 b. decreases; $0.60 to $0.50 c. decreases; $0.70 to $0.60 d. increases; $0.60 to $0.70 Question 6 Correct Mark 1.00 out of 1.00 Flag question Question text In this exhibit (Demand for Shirts) the price elasticity of demand for the segment CD is: Select one: a. greater than 1 (absolute value). b. -1. c. -0.71. d. -0.29. Question 7 Correct Mark 1.00 out of 1.00 Flag question Question text A demand curve that is perfectly inelastic: Select one: a. will be vertical. b. will be horizontal. c. will be upward sloping. d. has an elasticity equal to 1 everywhere on the curve. Question 8 Correct Mark 1.00 out of 1.00 Flag question Question text If the price of chocolate-covered peanuts increases and the demand for strawberries does not change, this indicates that these two goods are: Select one: a. unrelated goods. b. inferior goods. c. substitute goods. d. complementary goods. Question 9 Correct Mark 1.00 out of 1.00 Flag question Question text The cross price elasticity of demand for Coke with respect to the price of Pepsi has been estimated to be 0.61. If the price of Pepsi falls by 10 percent in a period, how will that affect the demand for Coke in that period, all other things unchanged? Select one: a. The demand for Coke will increase but by less than 6.1 percent. b. The demand for Coke will increase by 6.1 percent. c. The demand for Coke will not change because many people prefer Coke over Pepsi. d. The demand for Coke will fall. Question 10 Correct Mark 1.00 out of 1.00 Flag question Question text Although in most cases the price elasticity of labor supply is , for some individuals it may be . Select one: a. negative; zero b. negative; positive c. positive; negative d. zero; negative t Started on Wednesday, 16 February 2022, 12:54 PM State Finished Completed on Wednesday, 16 February 2022, 12:57 PM Time taken 2 mins 23 secs Grade 10.00 out of 10.00 (100%) Question 1 Correct Mark 1.00 out of 1.00 Flag question Question text Which of the following statements is false? Select one: a. The income effect of normal goods counters the substitution effect so the demand curve is upsloping. b. The income effect and the substitution effect reinforce each other when there are price changes for a normal good. c. The income effect represents the decrease in quantity demanded caused by the implicit change in income due to a fall in the price of an inferior good but not for a normal good. d. The substitution effect represents the change in quantity demanded solely due to a change in the relative price of a good. Question 2 Correct Mark 1.00 out of 1.00 Flag question Question text For a/an good, an increase in income will lead to an increase in . Select one: a. inferior; consumption b. normal; supply c. normal; consumption d. inferior; supply Question 3 Correct Mark 1.00 out of 1.00 Flag question Question text Assume that the total utilities for the fifth and sixth units of a good consumed are 83 and 97, respectively. The marginal utility for the sixth unit is: Select one: a. -14. b. 14. c. 83. d. 97. Question 4 Correct Mark 1.00 out of 1.00 Flag question Question text In this exhibit (Consumer Equilibrium 1), assume that the price of good X is $2 per unit and the price of good Y is $1 per unit, and you consume 3 units of good X and 3 units of good Y. To maximize utility, assuming that the goods are divisible, you would consume: Select one: a. less of both X and Y. b. more of both X and Y. c. less of X and more of Y. d. more of X and less of Y. Question 5 Correct Mark 1.00 out of 1.00 Flag question Question text If the price of apples falls and the price of oranges remains constant: Select one: a. apples are now relatively cheaper. b. the fall in the price of apples made consumers richer. c. the fall in the price of apples, ceteris paribus, makes the marginal utility of apples divided by their price exceed the marginal utility of oranges divided by their price. d. all of the above statements are true. Feedback The correct answer is: all of the above statements are true. Question 6 Correct Mark 1.00 out of 1.00 Flag question Question text The textbook states that the law of demand: Select one: a. is nonsense. b. is difficult to verify. c. is confirmed by our real-world experience. d. is not valid in theory. Question 7 Correct Mark 1.00 out of 1.00 Flag question Question text An indifference curve shows combinations of two goods that yield: Select one: a. equal prices. b. equal money income. c. equal satisfaction. d. increasing prices. Question 8 Correct Mark 1.00 out of 1.00 Flag question Question text A curve that represents combinations of two goods that yield equal levels of satisfaction is a/an: Select one: a. indifference curve. b. budget curve. c. marginal utility curve. d. price-consumption curve. Question 9 Correct Mark 1.00 out of 1.00 Flag question Question text The marginal rate of substitution assumes that: Select one: a. prices remain unchanged. b. money income remains unchanged. c. satisfaction remains unchanged. d. the quantities of both goods remain unchanged. Question 10 Correct Mark 1.00 out of 1.00 Flag question Question text If consumer income, preferences, and the prices of all other goods remain constant while the price of X varies, the amount purchased of X is defined by the: Select one: a. demand curve. b. price-consumption curve. c. income-consumption curve. d. price line. z t State Finished Completed on Wednesday, 16 February 2022, 1:07 PM Time taken 2 mins 13 secs Grade 10.00 out of 10.00 (100%) Question 1 Correct Mark 1.00 out of 1.00 Flag question Question text At 36 units of labor, a firm finds that both average product of labor and marginal product of labor equal 42. We can conclude that the average product curve at 36 units of labor is: Select one: a. upward-sloping. b. downward-sloping. c. vertical. d. horizontal. Question 2 Correct Mark 1.00 out of 1.00 Flag question Question text Diminishing marginal returns for the first four units of a variable input is exhibited by the marginal product sequence: Select one: a. 50, 50, 50, 50. b. 50, 40, 30, 20. c. 50, 110, 180, 260. d. 50, 100, 150, 200. Question 3 Correct Mark 1.00 out of 1.00 Flag question Question text Fixed costs include: Select one: a. op management salaries. b. wage rates set by contract. c. salaries of production workers. d. costs of electricity used in production. Question 4 Correct Mark 1.00 out of 1.00 Flag question Question text If the slope of the total product curve is decreasing, the slope of the total variable cost curve is: Select one: a. increasing. b. decreasing. c. unchanged. d. at its minimum value. Question 5 Correct Mark 1.00 out of 1.00 Flag question Question text The marginal cost curve intersects the total variable cost curve at: Select one: a. its lowest point. b. its maximum. c. its endpoint. d. no point; the curves don't intersect. Question 6 Correct Mark 1.00 out of 1.00 Flag question Question text Average total cost is the ratio of: Select one: a. total cost to the marginal cost. b. total cost to the quantity of output. c. total cost to the amount of variable input. d. marginal cost to the amount of variable input. Question 7 Correct Mark 1.00 out of 1.00 Flag question Question text If marginal cost is equal to average total cost, then: Select one: a. average total cost is increasing. b. average total cost is at its maximum. c. average total cost is at its minimum. d. marginal cost is increasing. Question 8 Correct Mark 1.00 out of 1.00 Flag question Question text In this exhibit (A Firm's Cost Curves) the curve labeled W represents the firm's curve. Select one: a. average fixed cost b. average total cost c. average variable cost d. total variable cost Question 9 Correct Mark 1.00 out of 1.00 Flag question Question text When an increase in the firm's output reduces its long-run average cost, it experiences: Select one: a. economies of scale. b. diseconomies of scale. c. constant returns to scale. d. variable returns to scale. Question 10 Correct Mark 1.00 out of 1.00 Flag question Question text The slope of a long-run average cost curve exhibiting diseconomies of scale is: Select one: a. zero. b. infinite. c. positive. d. negative. t Started on Wednesday, 16 February 2022, 2:05 PM State Finished Completed on Wednesday, 16 February 2022, 2:19 PM Time taken 13 mins 41 secs Marks 29.00/29.00 Grade 100.00 out of 100.00 Question 1 Correct Mark 1.00 out of 1.00 Flag question Question text After graduation from college you will receive a substantial increase in your income from a new job. If you decide that you will purchase more T-bone steak and less hamburger, then for you hamburger would be considered a/an: Select one: a. normal good. b. substitute good. c. complementary good. d. inferior good. Question 2 Correct Mark 1.00 out of 1.00 Flag question Question text In the 1970s, the Organization of Petroleum Exporting Countries (OPEC) tripled the price of petroleum, causing automobile manufacturers to look for ways to produce more fuel-efficient cars by substituting aluminum and plastic for steel. This was primarily a response to the economic question of: Select one: a. When will each good be produced? b. For whom shall the goods be produced? c. What goods and services should a society produce? d. How should goods and services be produced? Question 3 Correct Mark 1.00 out of 1.00 Flag question Question text John Smedley, a careful maximizer of utility, consumes only two goods, peanut butter and ice cream. He had just achieved the utility-maximizing solution in his consumption of the two goods when the price of ice cream fell. As he adjusts to this event, he will consume: Select one: a. more peanut butter and more ice cream. b. less peanut butter and less ice cream. c. more peanut butter and less ice cream. d. less peanut butter and more ice cream. Question 4 Correct Mark 1.00 out of 1.00 Flag question Question text A free good is: Select one: a. also a scarce good. b. a relatively abundant good. c. a good with no opportunity cost. d. a good with relatively low opportunity cost. Question 5 Correct Mark 1.00 out of 1.00 Flag question Question text Assume a market initially exhibits a shortage. Assuming that both prices and quantities are flexible, which of the following will be true after the market adjusts to equilibrium? Select one: a. Price is lower. b. Quantity demanded is greater. c. Quantity supplied is more. d. Quantity supplied will be reduced. Question 6 Correct Mark 1.00 out of 1.00 Flag question Question text The economy's factors of production are not equally suitable for producing different types of goods. This principle generates: Select one: a. economic growth. b. technical efficiency. c. resource underutilization. d. the law of increasing opportunity cost. Question 7 Correct Mark 1.00 out of 1.00 Flag question Question text When moving along a production possibilities curve, the opportunity cost to society of getting more of the good on the horizontal axis: Select one: a. is constant. b. is measured in dollar terms. c. is measured by the amount of the other good that must be given up. d. usually decreases. Question 8 Correct Mark 1.00 out of 1.00 Flag question Question text The observed correlation between baldness and heart disease demonstrates that: Select one: a. being bald causes a man to have heart disease. b. being bald actually makes heart disease less likely. c. bald men are generally unreliable. d. there is probably some other factor that causes both baldness and heart disease. Question 9 Correct Mark 1.00 out of 1.00 Flag question Question text The best example of an increase in capital is: Select one: a. The discovery of new oil reserves. b. new computer software. c. legal immigration of computer programmers. d. conversion of military facilities to civilian uses. Question 10 Correct Mark 1.00 out of 1.00 Flag question Question text In this exhibit (Demand and Supply Curves), a surplus of 200 units will occur at a price of and a shortage of 200 units will occur at a price of . Select one: a. $15; $10 b. $15; $15 c. $15; $25 d. $25; $10 Question 11 Correct Mark 1.00 out of 1.00 Flag question Question text Resources from nature that can be used to to produce other goods and services are called: Select one: a. money. b. natural resources. c. labor. d. capital. Question 12 Correct Mark 1.00 out of 1.00 Flag question Question text The Case in Point on campus parking suggested that giving students lower fares for taking public transportation was what kind of factor in the demand for parking spaces? Select one: a. supply shifter b. demand shifter c. false prophet d. spoiler Question 13 Correct Mark 1.00 out of 1.00 Flag question Question text If an increase in income leads to an increase in the demand for a good, then the good is said to be: Select one: a. normal. b. a luxury. c. inferior. d. a staple or necessity. Question 14 Correct Mark 1.00 out of 1.00 Flag question Question text A competitive market with flexible prices and many buyers and sellers will: Select one: a. tend to create surpluses. b. tend to create shortages. c. reach an equilibrium where the market clears. d. reach and equilibrium only if a government agency sets the price. Question 15 Correct Mark 1.00 out of 1.00 Flag question Question text Any point inside a production possibilities curve indicates: Select one: a. unemployment and/or inefficiency. b. that the law of increasing opportunity costs is no longer valid. c. that society doesn't want more of either good. d. that economic growth is no longer possible. Question 16 Correct Mark 1.00 out of 1.00 Flag question Question text Which of the following statements is (are) true? Select one: a. Consumers are constrained by a budget. b. If a consumer decides to spend more on one good, he or she must decide to spend less on another good to satisfy the budget constraint. c. The marginal decision rule states that an activity should be expanded if its marginal benefit exceeds its marginal cost. d. All of the above statements are true. Question 17 Correct Mark 1.00 out of 1.00 Flag question Question text Suppose that the price elasticity of demand for grapefruit is -2.8. The introduction of a new variety that is cheaper to grow should cause consumer expenditures for grapefruit to: Select one: a. rise. b. fall. c. remain unchanged. d. it is not possible to answer with the information given. Question 18 Correct Mark 1.00 out of 1.00 Flag question Question text The price of apples falls. What happens in the market for apple pies? Select one: a. The equilibrium price falls, and the equilibrium quantity rises. b. The equilibrium price rises, and the equilibrium quantity falls. c. The equilibrium price and quantity rise. d. The equilibrium price and quantity fall. Question 19 Correct Mark 1.00 out of 1.00 Flag question Question text Demand for a normal good with in income. Select one: a. rises; decreases b. falls; increases c. rises; increases d. stays the same; increases Question 20 Correct Mark 1.00 out of 1.00 Flag question Question text Ceteris paribus means: Select one: a. allowing all other things to change. b. making value judgments. c. all other things unchanged. d. differentiating between macroeconomics and microeconomics. Question 21 Correct Mark 1.00 out of 1.00 Flag question Question text If the price elasticity of supply is greater than 1, then: Select one: a. supply is price elastic. b. supply is price inelastic. c. supply is unit price elastic. d. quantity supplied is relatively unresponsive to price changes. Question 22 Correct Mark 1.00 out of 1.00 Flag question Question text If, for a particular consumer, the marginal utility of ties is greater than the marginal utility of shirts, this consumer should: Select one: a. buy more ties and fewer shirts. b. buy more shirts and fewer ties. c. buy the same amount of each. d. not do anything until more information is available. Question 23 Correct Mark 1.00 out of 1.00 Flag question Question text Human effort that can be applied in the production process is called: Select one: a. natural resources. b. technology. c. labor. d. specialization. Question 24 Correct Mark 1.00 out of 1.00 Flag question Question text The fact that a society's production possibilities curve is bowed out from the origin of a graph demonstrates the law of: Select one: a. increasing opportunity cost. b. decreasing opportunity cost. c. constant opportunity cost. d. convex opportunity cost. Question 25 Correct Mark 1.00 out of 1.00 Flag question Question text The income effect refers to: Select one: a. changes in income because of changes in business investment. b. changes in money or nominal income because of changes in wages. c. a change in the quantity demanded of a good because of an implicit change in the buyer's income caused by a change in the price of a good or service. d. a change in the quantity demanded of a good because of a change in the buyer's money income. Question 26 Correct Mark 1.00 out of 1.00 Flag question Question text Which of the following statements is (are) true? Select one: a. As a consumer consumes more and more of a good or service, its marginal utility eventually falls. b. Utility is a quality inherent in the good or service itself. c. Marginal utility is the change in total utility resulting from consuming one more or one less unit of a good. d. Both A and C are true. Question 27 Correct Mark 1.00 out of 1.00 Flag question Question text When the percentage change in quantity demanded is less than the percentage change in price: Select one: a. demand is price elastic. b. demand is price inelastic. c. an increase in price will result in lower total revenue. d. total revenue will be zero at the midpoint of a linear demand curve. Question 28 Correct Mark 1.00 out of 1.00 Flag question Question text The fundamental economic questions that every economic system must answer are: Select one: a. what, how, and for whom. b. what, why, and for whom. c. when, why, and for whom. d. how, when, and how much. Question 29 Correct Mark 1.00 out of 1.00 Flag question Question text Suppose that voters in your community pass a one-cent sales tax increase to fund education, knowing full well they will have to forgo other goods they typically consume. This primarily addresses the economic question of: Select one: a. How will each good be produced? b. For whom shall the goods be produced? c. Why will the resources be used to produce goods? d. What goods and services should a society produce? z t Started on Wednesday, 23 February 2022, 9:05 AM State Finished Completed on Wednesday, 23 February 2022, 9:07 AM Time taken 2 mins 18 secs Grade 10.00 out of 10.00 (100%) Question 1 Correct Mark 1.00 out of 1.00 Flag question Question text Perfect competition is important to study because it: Select one: a. is a theoretical extreme used for analysis. b. is a realistic model of a few key markets. c. is a realistic model of many different markets. d. avoids all real-world problems and complexities. Question 2 Correct Mark 1.00 out of 1.00 Flag question Question text The difference between total revenue and total cost is: Select one: a. economic profit. b. nominal revenue. c. average revenue. d. marginal revenue. Question 3 Correct Mark 1.00 out of 1.00 Flag question Question text When a firm's total revenue exceeds its total cost: Select one: a. average revenue is less than average total cost. b. total cost falls with increases in output. c. total cost rises with increases in output. d. marginal cost is negative. Question 4 Correct Mark 1.00 out of 1.00 Flag question Question text The profit-maximizing level of output for a perfectly competitive firm in the short run occurs where: Select one: a. marginal cost equals price. b. marginal revenue equals price. c. total revenue equals total cost. d. average revenue equals average total cost. Question 5 Correct Mark 1.00 out of 1.00 Flag question Question text In this exhibit (A Perfectly Competitive Firm in the Short Run), the firm will shut down in the short run if the price falls below: Select one: a. 0G. b. 0F. c. 0E. d. 0P. Question 6 Correct Mark 1.00 out of 1.00 Flag question Question text A perfectly competitive firm will continue producing in the short run as long as it can cover its: Select one: a. total cost. b. average total cost. c. average variable cost. d. average fixed cost. Question 7 Correct Mark 1.00 out of 1.00 Flag question Question text If some firms in a perfectly competitive industry are earning positive economic profits, then in the long run, the: Select one: a. industry is in long-run equilibrium. b. industry supply curve will shift to the right. c. number of firms in the industry will not change. d. number of firms in the industry will decrease. Question 8 Correct Mark 1.00 out of 1.00 Flag question Question text Suppose that the market for candy canes operates under conditions of perfect competition, that it is initially in long-run equilibrium, and that the price of each candy cane is $0.10. Based on the information given, we can conclude that the average revenue for candy canes: Select one: a. is less than $0.10. b. equals $0.10. c. is greater than $0.10. d. It is not possible to answer based on the information given. Question 9 Correct Mark 1.00 out of 1.00 Flag question Question text If a perfectly competitive industry is characterized by constant costs in the long run, its long-run: Select one: a. marginal revenue curve is vertical. b. marginal cost curve is vertical. c. industry supply curve is horizontal. d. average fixed cost curve is horizontal. Question 10 Correct Mark 1.00 out of 1.00 Flag question Question text An increase in demand in a perfectly competitive industry characterized by constant costs will cause a/an: Select one: a. permanent increase in price. b. economic loss for firms. c. increase in the quantity supplied in the short run and an increase in market supply in the long run. d. decrease in firm's marginal revenue. z t Started on Wednesday, 23 February 2022, 9:08 AM State Finished Completed on Wednesday, 23 February 2022, 9:10 AM Time taken 1 min 37 secs Grade 9.00 out of 10.00 (90%) Question 1 Correct Mark 1.00 out of 1.00 Flag question Question text A natural monopoly is most likely to result if a single firm: Select one: a. is the only seller in a community. b. is investor-owned, but is granted the exclusive right by the government to operate in a market. c. experiences economies of scale over a wide range of output. d. has gained control over a strategic input of an important production process. Question 2 Correct Mark 1.00 out of 1.00 Flag question Question text A location-based monopoly is most likely to result if a single firm: Select one: a. is the only seller in a small town or community. b. is investor owned, but granted the exclusive right by the government to operate in a market. c. experiences long-run increasing economies of scale over a wide range of output. d. has gained control over a strategic input of an important production process. Question 3 Correct Mark 1.00 out of 1.00 Flag question Question text Situations in which the more users of a product there are, the more useful the product becomes are called: Select one: a. network effects. b. monopolies. c. conglomerates. d. exclusive franchises. Question 4 Correct Mark 1.00 out of 1.00 Flag question Question text A firm that faces a downward-sloping demand curve: Select one: a. is a perfectly competitive firm. b. is a price taker. c. has some monopoly power. d. cannot sell more at lower prices. Question 5 Incorrect Mark 0.00 out of 1.00 Flag question Question text In this exhibit (Demand, Elasticity, and Total Revenue), when price is P and quantity is Q in Panel (a), which of the following is (are) true? Select one: a. An increase in price will increase total revenue. b. A decrease in price will increase total revenue. c. P x Q is the maximum amount TR can be. d. B and C are true. Question 6 Correct Mark 1.00 out of 1.00 Flag question Question text Assume that Sandy Chip Products, Inc. is the world's only producer of a special kind of computer chip. Its patents assure that it will continue to be the only producer for at least the next decade. Chip production requires clean water. The firm gets its water from a river, which is being polluted by paper mills located upstream. Sandy Chip therefore has to process the water before using it. A recently enacted pollution-control program, whereby the paper mills will be fined for polluting the river, will result in less pollution and thus lower Sandy Chip's costs. Sandy Chip expects its marginal and average cost to fall by $20 per chip. With the reduction in its costs, Sandy Chip will probably: Select one: a. lower its price by $20. b. lower its price, but by less than $20. c. lower its price, but by more than $20. d. It is not possible to make a determination from the information given. Question 7 Correct Mark 1.00 out of 1.00 Flag question Question text In this exhibit (Monopoly Model), when the firm is in equilibrium (that is, maximizing its economic profit), its total revenue is the area of rectangle: Select one: a. SPDB. b. IPDH. c. 0SBJ. d. 0PDJ. Question 8 Correct Mark 1.00 out of 1.00 Flag question Question text Which of the following is true regarding monopoly? Select one: a. Monopolies produce too much and charge too much from the standpoint of efficiency. b. Monopolies usually are economically efficient because they have economic profits with which to work. c. Monopolies produce too little and charge too much from the standpoint of efficiency. d. Monopolies create an efficiency problem but are not associated with an equity problem. Question 9 Correct Mark 1.00 out of 1.00 Flag question Question text In contrast to a monopoly firm, a perfectly competitive firm: Select one: a. is a price taker. b. faces a downward-sloping demand curve. c. has only a moderate degree of monopoly power. d. produces more than the efficient level of output. Question 10 Correct Mark 1.00 out of 1.00 Flag question Question text A feature of monopoly that leads to unfavorable consequences is that it: Select one: a. reduces income inequality. b. sets marginal cost equal to marginal revenue rather than price. c. produces more output than if perfectly competitive firms characterized the same industry. d. charges a lower price than if perfectly competitive firms characterized the same industry. z t Started on Monday, 28 February 2022, 7:23 PM State Finished Completed on Monday, 28 February 2022, 7:25 PM Time taken 1 min 57 secs Grade 10.00 out of 10.00 (100%) Question 1 Correct Mark 1.00 out of 1.00 Flag question Question text Imperfect competition includes: Select one: a. monopolistic competition and oligopoly. b. monopolistic competition and monopoly. c. perfect competition and monopoly. d. monopoly and oligopoly. Question 2 Correct Mark 1.00 out of 1.00 Flag question Question text In large shopping areas, the retail market is most illustrative of: Select one: a. monopolistic competition. b. monopoly. c. perfect competition. d. perfect oligopoly. Question 3 Correct Mark 1.00 out of 1.00 Flag question Question text Due to the existence of a large number of similar, but not identical, substitutes in most communities, the market for chiropractors is best considered: Select one: a. an oligopoly. b. perfect competition. c. monopolistic competition. d. a monopoly. Question 4 Correct Mark 1.00 out of 1.00 Flag question Question text The market for plumbing services in a city can be characterized by the model of monopolistic competition. Suppose that the market is initially in long-run equilibrium, and then there is an increase in demand for plumbing services. We expect that in the long run: Select one: a. firms will leave the plumbing market. b. there will be a short-run increase in the number of firms, but then the number will return to the original level. c. new firms will enter the plumbing market. d. firms will shut down, but they will not leave the industry. Question 5 Correct Mark 1.00 out of 1.00 Flag question Question text A criticism of oligopolistic firms is that they: Select one: a. have high concentration ratios. b. are associated with unstable prices. c. experience economies of scale. d. retard research and development. Question 6 Correct Mark 1.00 out of 1.00 Flag question Question text An oligopoly knows that its affect(s) its and that the of its rivals will affect it. Select one: a. actions; rivals; reactions b. price changes; total revenue in a positive way; reactions c. actions rarely; rivals; actions d. price increases; total revenue in the long run only; large but not small price changes Question 7 Correct Mark 1.00 out of 1.00 Flag question Question text According to the text exhibit on concentration ratios and Herfindahl-Hirschman Indexes, which of the following industries has the lowest HHI? Select one: a. ice cream b. breakfast cereal c. motor vehicles and passenger car bodies d. medicinal chemicals and botanical products Question 8 Correct Mark 1.00 out of 1.00 Flag question Question text In this exhibit (Monopoly Through Collusion), is an illustration of the situation in an industry that consists of two firms facing identical demand curves; the demand curve for each firm is D1. If the firms collude and agree to share the market demand equally, then each firm will act as if its demand curve is given by and the market demand curve is given by . Select one: a. D1; MR2 b. D2; D1 c. D1; D2 d. MR1; MR2 Question 9 Correct Mark 1.00 out of 1.00 Flag question Question text Suppose that each of two prisoners has the independent choice of confessing to a crime or not confessing. If neither confesses, they spend 2 years in jail; if both confess, they spend 3 years in jail; and if one confesses while the other does not, the confessor gets off with 1 year in jail while the other gets 6 years in jail. According to game theory, the likely strategy by the prisoners is: Select one: a. both will confess. b. neither will confess. c. one will confess and the other will not. d. both may or may not confess. Question 10 Correct Mark 1.00 out of 1.00 Flag question Question text A strategy that is the same regardless of the action of the other player in a game is said to be a: Select one: a. competitive strategy. b. trigger strategy. c. dominant strategy. d. tit-for-tat strategy. z t Started on Tuesday, 1 March 2022, 12:42 PM State Finished Completed on Tuesday, 1 March 2022, 12:42 PM Time taken 51 secs Grade 10.00 out of 10.00 (100%) Question 1 Correct Mark 1.00 out of 1.00 Flag question Question text A complete business cycle is defined by the passage from: Select one: a. one peak to the next peak. b. one peak to the next trough. c. one trough to the ensuing expansion. d. one expansion to the next expansion. Question 2 Correct Mark 1.00 out of 1.00 Flag question Question text In this exhibit (Figure 5-1), the trough of the business cycle occurs: Select one: a. between t1 and t2. b. at t1. c. between t2 and t3. d. at t2. Question 3 Correct Mark 1.00 out of 1.00 Flag question Question text To determine whether an economy's output is growing or shrinking, one must keep track of: Select one: a. changes in nominal GDP. b. changes in the growth rate of nominal GDP. c. changes in the general price level. d. changes in real GDP. Question 4 Correct Mark 1.00 out of 1.00 Flag question Question text Which of the following is an example of structural unemployment? Select one: a. An autoworker who is temporarily laid off from an automobile company due to a decline in sales. b. A geologist who is permanently laid off from an oil company due to a new technological advance. c. A worker at a fast-food restaurant who quits work and attends college. d. A real estate agent who leaves a job in Texas and searches for a similar, higher paying job in California. Question 5 Correct Mark 1.00 out of 1.00 Flag question Question text Which of the following statements is true? Select one: a. Unexpected inflation benefits lenders and hurts borrowers. b. Unexpected deflation benefits lenders and hurts borrowers. c. Unexpected inflation benefits borrowers but does not affect lenders. d. Unexpected deflation benefits lenders but does not affect borrowers. Question 6 Correct Mark 1.00 out of 1.00 Flag question Question text Which of the following statements is true of price indexes? I. They indicate what is happening to the general level of prices II. They are used to estimate the rate of inflation or deflation. III. They are used to convert nominal values to real values, so comparisons can be made across time. Select one: a. I only b. I and II only c. I and III only d. I, II, and III Question 7 Correct Mark 1.00 out of 1.00 Flag question Question text If the cost of a market basket is $200 in 2006 and $230 in 2007, the price index for 2007 using 2006 as the base year is: Select one: a. 1.00. b. 1.15. c. 1.30. d. 2.00. Question 8 Correct Mark 1.00 out of 1.00 Flag question Question text Suppose in 2007, nominal GDP in Clarendon was $12,840 billion and real GDP was $10,560 billion. Calculate the value of the implicit price deflator. Follow the convention of multiplying price indexes by 100. Select one: a. 21.59 b. 82.24 c. 121.59 d. 177.57 Question 9 Correct Mark 1.00 out of 1.00 Flag question Question text Which of the following exemplifies the outlet bias in the computation of the CPI? Select one: a. Roxanna refuses to shop at factory outlet stores because she says that the layouts of the stores are too chaotic and therefore is too time-consuming. b. Yu-Jen does most of her family's shopping at Costco instead of Safeway because the prices at Costco are more competitive. c. Katie prefers to buy her groceries at Whole Foods because they carry a wide selection oforganic produce. d. Diana does her holiday shopping when she travels to China to take advantage of the "great deals" on most items. Question 10 Correct Mark 1.00 out of 1.00 Flag question Question text The natural rate of unemployment: Select one: a. increases during recessions. b. equals the sum of frictional and cyclical unemployment. c. equals the sum of frictional and structural unemployment. d. is always less than full employment rate of unemployment. z t Started on Monday, 7 March 2022, 7:27 PM State Finished Completed on Monday, 7 March 2022, 7:29 PM Time taken 2 mins 9 secs Grade 10.00 out of 10.00 (100%) Question 1 Correct Mark 1.00 out of 1.00 Flag question Question text Gross domestic product: Select one: a. is a flow variable. b. is a stock variable. c. could be either a flow variable or a stock variable depending on the time period considered. d. is neither a flow nor a stock variable; it is a statistic. Question 2 Correct Mark 1.00 out of 1.00 Flag question Question text In this exhibit (Figure 6-2), a New York restaurant purchases 1,000 cases of French wine. This transaction is recorded as part of: Select one: a. gross private investment and the flow is represented by 2. b. net exports and the flow is represented by 4. c. consumption expenditure and the flow is represented by 1. d. consumption expenditure and the flow is represented by 4. Question 3 Correct Mark 1.00 out of 1.00 Flag question Question text Which of the following is an example of an intermediate good? Select one: a. a new boat purchased by your brother for vacation purposes b. purchase of lumber by a property developer to be used in building a new house c. payments to military personnel d. a professor's salary Question 4 Correct Mark 1.00 out of 1.00 Flag question Question text The largest component of factor income is: Select one: a. rental income. b. profits. c. employee compensation. d. consumption. Question 5 Correct Mark 1.00 out of 1.00 Flag question Question text Executive salaries and bonuses are included in the income category of: Select one: a. employee compensation. b. rental income. c. net interest. d. profits. Question 6 Correct Mark 1.00 out of 1.00 Flag question Question text Which of the following is an example of an indirect business tax? Select one: a. consumption tax b. corporate profit tax c. personal income tax d. property tax Question 7 Correct Mark 1.00 out of 1.00 Flag question Question text Changes in nominal GDP: Select one: a. are due to changes in price only while changes in real GDP are attributed to movements in output and price. b. are due to changes in output and price while changes in real GDP are attributed to movements in output only. c. are due to changes in output and price while changes in real GDP are attributed to movements in price only. d. and changes in real GDP are due to changes in output and price. Question 8 Correct Mark 1.00 out of 1.00 Flag question Question text "Titanic," a movie released in 1998, was, as of 1999, the top-grossing movie of all time. However, in real terms, it ranked eighth in box office receipts, below an older hit movie, "Gone With the Wind." We can conclude that: Select one: a. more people went to see "Gone with the Wind" than "Titanic." b. fewer people went to see "Gone with the Wind" than "Titanic." c. over times, individuals movie watching habits have changed. d. We cannot draw any conclusions without information on ticket prices. Question 9 Correct Mark 1.00 out of 1.00 Flag question Question text All else constant, an outbreak of avian flu: Select one: a. is likely to increase GDP because it drives up health-care spending. b. is likely to decrease GDP because output is likely to fall. c. is unlikely to affect GDP. d. is likely to increase government transfer payments. Question 10 Correct Mark 1.00 out of 1.00 Flag question Question text In the generation of GDP, pollution often occurs. As a result: Select one: a. the value of nominal GDP will always be greater than the value of real GDP. b. the value of real GDP will always be greater than the value of nominal GDP. c. GDP is not always a good measure of economic or social welfare. d. the value of GDP is underestimated. z t Started on Monday, 7 March 2022, 7:29 PM State Finished Completed on Monday, 7 March 2022, 7:32 PM Time taken 2 mins 16 secs Grade 10.00 out of 10.00 (100%) Question 1 Correct Mark 1.00 out of 1.00 Flag question Question text Potential output is: Select one: a. the level of real GDP that exists when the economy is experiencing only cyclical and structural unemployment. b. the level of real GDP that exists when the quantity of labor supplied is equal to the quantity of labor demanded. c. the level of real GDP that exists when the actual rate of unemployment is zero. d. the level of real GDP that exists when the economy is experiencing only frictional and cyclical unemployment. Question 2 Correct Mark 1.00 out of 1.00 Flag question Question text In this exhibit (Figure 7-2), changes in aggregate demand from AD1 to either AD2 or AD3: Select one: a. will change nominal GDP but will not change real GDP in the long run. b. will change real GDP but will not change nominal GDP in the long run. c. will change the potential level of real GDP. d. will change the price level and real GDP. Question 3 Correct Mark 1.00 out of 1.00 Flag question Question text Which of the following is a source of wage stickiness? I. fixed wage contracts II. minimum wage laws III. workers and firms want to avoid complexity of negotiating contracts frequently Select one: a. I only b. I and II only c. I and III only d. I, II, and III Question 4 Correct Mark 1.00 out of 1.00 Flag question Question text All the following explain price stickiness except: Select one: a. firms choose not to adjust prices until they can assess if changes in sales are temporary or permanent. b. the more firms produce, the lower the average cost of production. Therefore, firms are willing not raise prices as long as they can sell more. c. firms may be concerned that consumers may be angered by price increases. d. firms may be concerned that their rivals may not match their price increases. Question 5 Correct Mark 1.00 out of 1.00 Flag question Question text Which of the following is an explanation for price stickiness? I. There are adjustment costs associated with changing prices such as the cost of printing new price lists. II. Worker unions may forbid firms from raising prices for fear that workers may be laid off if demand for output falls. III. Firms may have explicit long-term contracts to sell their products to other firms at specified prices. Select one: a. I only b. I and II only c. I and III only d. I, II, and III Question 6 Correct Mark 1.00 out of 1.00 Flag question Question text Using the aggregate demand-aggregate supply model, predict what happens in the short run when the federal government enacts a cut in the personal income tax rates. Select one: a. The aggregate supply curve shifts right; the aggregate demand curve is not affected; price level decreases; real GDP increases. b. The aggregate supply curve shifts left; the aggregate demand curve is not affected; price level increases; real GDP decreases. c. The aggregate demand curve shifts right; the aggregate supply curve is not affected; price level and real GDP increase. d. The aggregate demand curve shifts left; the aggregate supply curve is not affected; price level and real GDP decrease. Question 7 Correct Mark 1.00 out of 1.00 Flag question Question text In the short-run, an output gap occurs because: Select one: a. there is insufficient demand for goods and services. b. there is insufficient supply of goods and services. c. wages and prices are fully flexible. d. wages and some prices have not adjusted sufficiently to maintain output at its potential level. Question 8 Correct Mark 1.00 out of 1.00 Flag question Question text In this exhibit (Figure 7-7), at output level YK: Select one: a. potential output is less than actual output. b. there is a surplus of real GDP. c. the unemployment rate exceeds the natural rate of unemployment. d. over time aggregate demand will rise to restore long-run equilibrium. Question 9 Correct Mark 1.00 out of 1.00 Flag question Question text In this exhibit (Figure 7-3), suppose that the economy is in long-run equilibrium at point A. Now suppose the stock market crashes, significantly reducing household wealth. In the short-run: Select one: a. the nominal wage rate falls. b. unemployment is above its natural level. c. there will be pressure on prices to rise. d. the short-run aggregate supply curve shifts to the left as firms cut production. Question 10 Correct Mark 1.00 out of 1.00 Flag question Question text In this exhibit (Figure 7-7), suppose the economy is initially at K. Which of the following statements best explains how the economy responds to restore long-run macroeconomic equilibrium? Select one: a. Over time, the aggregate demand curve will shift to the right until long-run equilibrium is restored at J and the gap is closed. b. Rising unemployment puts pressure on nominal wages to fall. The SRAS curve shifts right to SRAS1 closing the gap at H. c. In response to rising prices, firms will increase production moving along SRAS2 until long-run equilibrium is restored at J and the gap is closed. d. Rising unemployment puts pressure on nominal wages to fall. Firms employ more workers moving along SRAS2 until long-run equilibrium is restored at J and the gap is closed. t State Finished Completed on Monday, 7 March 2022, 7:41 PM Time taken 8 mins 8 secs Marks 21.00/21.00 Grade 100.00 out of 100.00 Question 1 Correct Mark 1.00 out of 1.00 Flag question Question text According to the international trade effect, holding everything else unchanged, Select one: a. an increase in net exports shifts the aggregate demand curve to the right. b. an increase in the domestic price level reduces net exports leading to a movement along the aggregate demand curve. c. an increase in the exchange rate shifts the aggregate demand curve to the right. d. an increase in the prices of foreign goods level reduces imports leading to a movement along the domestic economy's aggregate demand curve. Question 2 Correct Mark 1.00 out of 1.00 Flag question Question text In this exhibit (Total Revenue, Total Costs, and Economic Profit), total revenue and total cost are equal at approximately pounds and $ . Select one: a. 0; 300 b. 2,000; 1,200 c. 4,500; 1,300 d. 8,300; 2,250 Question 3 Correct Mark 1.00 out of 1.00 Flag question Question text A statement that best reflects an evaluation of monopoly firms is that: Select one: a. they have a great deal of market power. b. they are economically efficient. c. consumers are given more choices, lower costs, and higher quality. d. competition should replace all monopolies. Question 4 Correct Mark 1.00 out of 1.00 Flag question Question text The market for plumbing services in a city can be characterized by the model of monopolistic competition. Suppose that the market is initially in long-run equilibrium, and then there is an increase in demand for plumbing services. We expect that in the long run: Select one: a. firms will leave the plumbing market. b. there will be a short-run increase in the number of firms, but then the number will return to the original level. c. new firms will enter the plumbing market. d. firms will shut down, but they will not leave the industry. Question 5 Correct Mark 1.00 out of 1.00 Flag question Question text The XYZ Company is a profit-maximizing firm with a monopoly in the production of pennants. The firm sells its pennants for $10 each. We can conclude that the XYZ Company is producing a level of output at which: Select one: a. average total cost equals $10. b. average total cost is greater than $10. c. marginal revenue equals $10. d. marginal cost equals marginal revenue. Question 6 Correct Mark 1.00 out of 1.00 Flag question Question text Charges that are paid for factors of production are called: Select one: a. implicit costs. b. opportunity costs. c. fixed costs. d. explicit costs. Question 7 Correct Mark 1.00 out of 1.00 Flag question Question text To practice effective price discrimination, a firm must: Select one: a. have some degree of monopoly power. b. avoid detection by government regulatory agencies. c. enable the resale of goods between groups of buyers. d. calculate the utility level of each buyer in the market. Question 8 Correct Mark 1.00 out of 1.00 Flag question Question text According to the Case in Point on hockey teams, economic theory predicts that if a sports team consistently sells out its games, it will operate at a quantity where marginal revenue is: Select one: a. the highest possible. b. positive. c. negative. d. equal to marginal cost and both are equal to zero. Question 9 Correct Mark 1.00 out of 1.00 Flag question Question text Economic profits are guaranteed for: Select one: a. a monopoly, but not a perfectly competitive firm. b. a perfectly competitive firm, but not a monopoly. c. both a monopoly and a perfectly competitive firm. d. neither a monopoly nor a perfectly competitive firm. Question 10 Correct Mark 1.00 out of 1.00 Flag question Question text An oligopoly knows that its affect(s) its and that the of its rivals will affect it. Select one: a. actions; rivals; reactions b. price changes ; total revenue in a positive way; reactions c. actions rarely; rivals; actions d. price increases; total revenue in the long run only; large but not small price changes Question 11 Correct Mark 1.00 out of 1.00 Flag question Question text The natural rate of unemployment: I. includes frictional and structural unemployment. II. is equal to zero when an economy is producing at a point on its production possibilities frontier. III. is the unemployment rate that exists when the quantity of labor demanded is equal to the quantity of labor supplied. Select one: a. I, II, and III b. I and II only c. I and III only d. II and III only Question 12 Correct Mark 1.00 out of 1.00 Flag question Question text A monopoly responds to an increase in demand by price and output. Select one: a. increasing; decreasing b. increasing; increasing c. decreasing; increasing d. decreasing, decreasing Question 13 Correct Mark 1.00 out of 1.00 Flag question Question text What do economists mean by the term "sticky wage?" Select one: a. It refers to the reluctance by employers to increase nominal wages during an inflationary period. b. It refers to a wage that is slow to adjust to its equilibrium level, creating sustained periods of shortage or surplus in the labor market. c. It refers to a breakdown in wage negotiations between employers and employee unions. d. It refers to a union negotiated wage. Question 14 Correct Mark 1.00 out of 1.00 Flag question Question text Which one of the following is an example of a frictionally unemployed individual? Select one: a. Martin, who lacks the skills necessary to be employed as a machinist. b. Lee, who lost his job as an art director because of a recession. c. Jan, who has a Ph.D. in economics, but is a bus driver. d. Helena, who has just graduated from college and is searching for a job as an architect. Question 15 Correct Mark 1.00 out of 1.00 Flag question Question text Monopolistic competition is an industry characterized by: Select one: a. a product with no close substitutes. b. a horizontal demand curve. c. a small number of firms. d. relatively easy entry and exit. Question 16 Correct Mark 1.00 out of 1.00 Flag question Question text If the CPI is 120 in 2005 and 150 in 2006, what is the rate of inflation over this period? Select one: a. 8% b. 20% c. 25% d. 30% Question 17 Correct Mark 1.00 out of 1.00 Flag question Question text The natural rate of unemployment: Select o