TestgBankgforgEconomicsgforgManagersg2ndgEditiongPar
t g1
Whichgofgthegfollowinggstatementsgisgcorrect?
1. A)gBygandglarge,gmanagerialgdecisionsgaregnotgaffectedgbygeith
ergmicroeconomicgorgmacroeconomicgforces.
2. B)gManagerialgdecisionsgaregaffectedgprimarilygbygmacroeconomicgforces.
3. C)gManagerialgdecisionsgaregaffectedgbygbothgmicroeconomicga
ndgmacroeconomicgforces.
4. D)gManagerialgdecisionsgaregaffectedgprimarilygbygmicroeconomicgforces.
Walmartʹsgdecisionging1994gtogcontinuegoperatinggstoresgingspecificgcities
gingMexicogwhengothergfirmsgweregpullinggoutgwouldgbegbestgclassifiedga
s:
1. A)g ag microeconomicg decision.
2. B)g ag macroeconomicg decision.
3. C)gbothgagmicroeconomicgandgagmacroeconomicgdecision.
4. D)gneithergagmicroeconomicgnorgagmacroeconomicgdecision.
Whichgofgthegfollowinggwouldgbegconsideredgangexamplegofgagmacroeco
nomicgproblem?
1. A)gShouldgMicrosoftgreducegthegpricegofgitsgWindowsgoperatinggsystem?
2. B)gShouldgJPgMorgangChasegincreasegtheginterestgrategitgchargesgitsgcre
ditgcardgcustomers?
3. C)gShouldgMitsubishigeliminategonegofgitsgproductiongshifts?
4. D)gShouldgthegfederalggovernmentgextendgthegeligibilitygperiodgf
orgunemploymentgbenefits?
WalmartʹsgentrygintogthegmarketgingMexicoghadgthegeffectgof:
1. A)greducinggcompetitiongandgraisinggthegpricesgofgmanygofgtheggood
sgitgsells.
2. B)gincreasinggcompetitiongandgraisinggthegpricesgofgmanygofgtheggood
sgitgsells.
3. C)gincreasinggcompetitiongandgloweringgthegpricesgofgmanygofgtheggood
sgitgsells.
, 4. D)greducinggcompetitiongandgloweringgthegpricesgofgmanygofgtheggood
sgitgsells.
Whichgofgthegfollowinggstatementsgisgfalse?
1. A)gWhilegmanagersgmustgunderstandghowgoutputgpricesgaregdetermine
d,gdeterminationgofginputgpricesgisgirrelevantgbecausegitgisgbeyondgth
egmanagerʹsgcontrol.
2. B)gPricegdeterminationgisgthegkeygelementginganygmarketgsystem.
3. C)gInputgpricesginfluencegagfirmʹsgcostsgofgproduction.
4. D)gOutputgpricesginfluencegagfirmʹsgrevenues.
Allgelsegconstant,gthegchoicegofgwhethergtogusegaglabor-
intensivegproductiongprocessgorgagcapital-intensivegonegisgdependsgon:
1. A)gthegabsolutegpricesgofgcapitalgandglabor.
2. B)gwhethergthegeconomygisggrowinggorgshrinking.
3. C)gthegrelativegpricesgofgcapitalglabor.
4. D)gthegtypeg ofgmarketging whichg thegfirmg operates.
Whichgofgthegfollowinggisgnotgagcharacteristicgofgagperfectlygcompetitiveg
market?
1. A)gLimitedginformationgisgavailablegtogallgmarketgparticipants.
2. B)gEasegofgentrygintogthegmarket.
3. C)gOutputsgofgthegfirmsgaregperfectgsubstitutesgforgoneganother.
4. D)gLargegnumbergofgfirmsgingthegindustry.
Firmsgaregconsideredgtogbegpricegsearchers,gasgopposedgtogpricegtakers,gi
ngallgofgthegfollowinggmarketgtypesgexcept:
1. A)gmonopoly.
2. B)gperfectgcompetition.
3. C)goligopoly.
4. D)gmonopolisticgcompetition.
,Whichgofgthegfollowinggconditionsgensuresgthatgexcessgprofitsgcannotg
persistgingagperfectlygcompetitivegmarketgovergtheglonggrun?
1. A)gLargegnumbergofgfirmsgingthegindustry.
2. B)gCompleteginformationgisgavailablegtogallgmarketgparticipants.
3. C)gOutputsgofgthegfirmsgaregperfectgsubstitutesgforgoneganother.
4. D)gEasegofgentrygintogthegmarket.
Whichgofgthegfollowinggstatementsgisgcorrect?
1. A)gAllgelsegconstant,gagmonopolygfirmghasgmoregmarketgpowergthan
gag monopolisticallyg competitivegfirm.
2. B)gThegfactgthatgthegfirmsgingangoligopolygaregmutuallyginterdepende
ntgmeansgthatgindividualgfirmsgdognotghaveganygmarketgpower.
3. C)gThegamountgofgmarketgpowergagfirmgpossessesgisgunrelatedgtogthegty
pegofgmarketgingwhichgitgoperates.
4. D)gSoglonggasgagfirmgisgsufficientlyglarge,gitgwillghavegsomegamount
gofg marketgpower,gregardlessgofgthegtypegofgmarketgingwhichgitgope
rates.
Thegmarketgstructuregthatgisgcharacterizedgbygagsmallgnumbergofglargegfir
msgthatghavegsomegmarketgpowergisgcalled:
1. A)goligopoly.
2. B)gmonopoly.
3. C)gperfectgcompetition.
4. D)gmonopolisticgcompetition.
Whichgofgthegfollowinggmarketgstructuresgisgmostgsimilargtogperfectgcom
petition?
1. A)g Monopolisticg competition.
2. B)gMonopsony.
3. C)gMonopoly.
4. D)gOligopoly.
Thegkeygcharacteristicgofgangoligopolisticgmarketgis:
1. A)gmutualginterdependencegamonggfirmsgingthegmarket.
, 2. B)gproductiongofgaghomogeneousgproduct.
3. C)g theg absenceg ofg marketg powerg byg anyg oneg firm.
4. D)geasegofgentryginto,gandgexitgoutgof,gthegmarket.
Whichgofgthegfollowinggstatementsgaboutgmonopolygisgfalse?
1. A)gBecausegtheregisgagsinglegfirmgservinggthegentiregmarket,gthegmonopol
istgcangchargegwhatevergpricegitgwantsgtogforgitsgoutput.
2. B)gAgsinglegfirmgservesgthegmarket.
3. C)gTheregaregusuallygsignificantgbarriersgtogentry.
4. D)gTheregaregnogclosegsubstitutesgforgthegmonopolistʹsgoutput.
Thegassumedggoalgofgthegfirmsgthatgoperategingeachgofgthegfourgmarketgs
tructuresgdiscussedgingthegtextgisgtogmaximize:
1. A)gprofits.
2. B)grevenue.
3. C)gprice.
4. D)gsales.
Whichgofgthegfollowinggstatementsgaboutgthegcirculargflowgmodelgisgfalse?
1. A)g Householdsg supplyg resourcesg tog theg businessg sector.
2. B)g Businessg firmsg buyg goodsg andg servicesg fromg theg householdg sector.
3. C)g Businessesg supplyg goodsg andg servicesg tog theg householdg sector.
4. D)g Consumersg earng incomeg byg sellingg resourcesg theyg owng tog businesses.
Whichgofgthegfollowinggstatementsgisgfalse?gIngthegcirculargflowgmodel:
1. A)gfactorgpaymentsgaregmadegtogbusinessgfirms.
2. B)gconsumptiongexpendituresgaregmadegbyghouseholds.
3. C)gthegfundsgneededgtogfinanceginvestmentgspendinggcomegfromgthegsavi
nggofghouseholds.
4. D)gGDPgcangbegmeasuredgeithergbygthegincomegreceivedgorgbygt
hegexpendituresgmade.
t g1
Whichgofgthegfollowinggstatementsgisgcorrect?
1. A)gBygandglarge,gmanagerialgdecisionsgaregnotgaffectedgbygeith
ergmicroeconomicgorgmacroeconomicgforces.
2. B)gManagerialgdecisionsgaregaffectedgprimarilygbygmacroeconomicgforces.
3. C)gManagerialgdecisionsgaregaffectedgbygbothgmicroeconomicga
ndgmacroeconomicgforces.
4. D)gManagerialgdecisionsgaregaffectedgprimarilygbygmicroeconomicgforces.
Walmartʹsgdecisionging1994gtogcontinuegoperatinggstoresgingspecificgcities
gingMexicogwhengothergfirmsgweregpullinggoutgwouldgbegbestgclassifiedga
s:
1. A)g ag microeconomicg decision.
2. B)g ag macroeconomicg decision.
3. C)gbothgagmicroeconomicgandgagmacroeconomicgdecision.
4. D)gneithergagmicroeconomicgnorgagmacroeconomicgdecision.
Whichgofgthegfollowinggwouldgbegconsideredgangexamplegofgagmacroeco
nomicgproblem?
1. A)gShouldgMicrosoftgreducegthegpricegofgitsgWindowsgoperatinggsystem?
2. B)gShouldgJPgMorgangChasegincreasegtheginterestgrategitgchargesgitsgcre
ditgcardgcustomers?
3. C)gShouldgMitsubishigeliminategonegofgitsgproductiongshifts?
4. D)gShouldgthegfederalggovernmentgextendgthegeligibilitygperiodgf
orgunemploymentgbenefits?
WalmartʹsgentrygintogthegmarketgingMexicoghadgthegeffectgof:
1. A)greducinggcompetitiongandgraisinggthegpricesgofgmanygofgtheggood
sgitgsells.
2. B)gincreasinggcompetitiongandgraisinggthegpricesgofgmanygofgtheggood
sgitgsells.
3. C)gincreasinggcompetitiongandgloweringgthegpricesgofgmanygofgtheggood
sgitgsells.
, 4. D)greducinggcompetitiongandgloweringgthegpricesgofgmanygofgtheggood
sgitgsells.
Whichgofgthegfollowinggstatementsgisgfalse?
1. A)gWhilegmanagersgmustgunderstandghowgoutputgpricesgaregdetermine
d,gdeterminationgofginputgpricesgisgirrelevantgbecausegitgisgbeyondgth
egmanagerʹsgcontrol.
2. B)gPricegdeterminationgisgthegkeygelementginganygmarketgsystem.
3. C)gInputgpricesginfluencegagfirmʹsgcostsgofgproduction.
4. D)gOutputgpricesginfluencegagfirmʹsgrevenues.
Allgelsegconstant,gthegchoicegofgwhethergtogusegaglabor-
intensivegproductiongprocessgorgagcapital-intensivegonegisgdependsgon:
1. A)gthegabsolutegpricesgofgcapitalgandglabor.
2. B)gwhethergthegeconomygisggrowinggorgshrinking.
3. C)gthegrelativegpricesgofgcapitalglabor.
4. D)gthegtypeg ofgmarketging whichg thegfirmg operates.
Whichgofgthegfollowinggisgnotgagcharacteristicgofgagperfectlygcompetitiveg
market?
1. A)gLimitedginformationgisgavailablegtogallgmarketgparticipants.
2. B)gEasegofgentrygintogthegmarket.
3. C)gOutputsgofgthegfirmsgaregperfectgsubstitutesgforgoneganother.
4. D)gLargegnumbergofgfirmsgingthegindustry.
Firmsgaregconsideredgtogbegpricegsearchers,gasgopposedgtogpricegtakers,gi
ngallgofgthegfollowinggmarketgtypesgexcept:
1. A)gmonopoly.
2. B)gperfectgcompetition.
3. C)goligopoly.
4. D)gmonopolisticgcompetition.
,Whichgofgthegfollowinggconditionsgensuresgthatgexcessgprofitsgcannotg
persistgingagperfectlygcompetitivegmarketgovergtheglonggrun?
1. A)gLargegnumbergofgfirmsgingthegindustry.
2. B)gCompleteginformationgisgavailablegtogallgmarketgparticipants.
3. C)gOutputsgofgthegfirmsgaregperfectgsubstitutesgforgoneganother.
4. D)gEasegofgentrygintogthegmarket.
Whichgofgthegfollowinggstatementsgisgcorrect?
1. A)gAllgelsegconstant,gagmonopolygfirmghasgmoregmarketgpowergthan
gag monopolisticallyg competitivegfirm.
2. B)gThegfactgthatgthegfirmsgingangoligopolygaregmutuallyginterdepende
ntgmeansgthatgindividualgfirmsgdognotghaveganygmarketgpower.
3. C)gThegamountgofgmarketgpowergagfirmgpossessesgisgunrelatedgtogthegty
pegofgmarketgingwhichgitgoperates.
4. D)gSoglonggasgagfirmgisgsufficientlyglarge,gitgwillghavegsomegamount
gofg marketgpower,gregardlessgofgthegtypegofgmarketgingwhichgitgope
rates.
Thegmarketgstructuregthatgisgcharacterizedgbygagsmallgnumbergofglargegfir
msgthatghavegsomegmarketgpowergisgcalled:
1. A)goligopoly.
2. B)gmonopoly.
3. C)gperfectgcompetition.
4. D)gmonopolisticgcompetition.
Whichgofgthegfollowinggmarketgstructuresgisgmostgsimilargtogperfectgcom
petition?
1. A)g Monopolisticg competition.
2. B)gMonopsony.
3. C)gMonopoly.
4. D)gOligopoly.
Thegkeygcharacteristicgofgangoligopolisticgmarketgis:
1. A)gmutualginterdependencegamonggfirmsgingthegmarket.
, 2. B)gproductiongofgaghomogeneousgproduct.
3. C)g theg absenceg ofg marketg powerg byg anyg oneg firm.
4. D)geasegofgentryginto,gandgexitgoutgof,gthegmarket.
Whichgofgthegfollowinggstatementsgaboutgmonopolygisgfalse?
1. A)gBecausegtheregisgagsinglegfirmgservinggthegentiregmarket,gthegmonopol
istgcangchargegwhatevergpricegitgwantsgtogforgitsgoutput.
2. B)gAgsinglegfirmgservesgthegmarket.
3. C)gTheregaregusuallygsignificantgbarriersgtogentry.
4. D)gTheregaregnogclosegsubstitutesgforgthegmonopolistʹsgoutput.
Thegassumedggoalgofgthegfirmsgthatgoperategingeachgofgthegfourgmarketgs
tructuresgdiscussedgingthegtextgisgtogmaximize:
1. A)gprofits.
2. B)grevenue.
3. C)gprice.
4. D)gsales.
Whichgofgthegfollowinggstatementsgaboutgthegcirculargflowgmodelgisgfalse?
1. A)g Householdsg supplyg resourcesg tog theg businessg sector.
2. B)g Businessg firmsg buyg goodsg andg servicesg fromg theg householdg sector.
3. C)g Businessesg supplyg goodsg andg servicesg tog theg householdg sector.
4. D)g Consumersg earng incomeg byg sellingg resourcesg theyg owng tog businesses.
Whichgofgthegfollowinggstatementsgisgfalse?gIngthegcirculargflowgmodel:
1. A)gfactorgpaymentsgaregmadegtogbusinessgfirms.
2. B)gconsumptiongexpendituresgaregmadegbyghouseholds.
3. C)gthegfundsgneededgtogfinanceginvestmentgspendinggcomegfromgthegsavi
nggofghouseholds.
4. D)gGDPgcangbegmeasuredgeithergbygthegincomegreceivedgorgbygt
hegexpendituresgmade.
