UL ECON528 - Exam 1 Questions With Complete Solutions
(T/F) A sale on men's slacks at T.J. Maxx, where if you buy the
first pair at full price, you can buy the second pair at half price,
is an example of differential pricing. Correct Answers True
(T/F) According to the profit maximization goal, the firm should
attempt to maximize short-run profits since there is too much
uncertainty associated with long-run profits Correct Answers
False
(T/F) Accounting costs exclude implicit costs Correct Answers
True
(T/F) Charging a different price for tickets to movies at twilight
than after 6 o'clock is an example of bundling. Correct Answers
False, it is third degree price discrimination
(T/F) Economic costs include implicit costs but no explicit costs
Correct Answers False
A change in all of the following variables will change the
market demand for a product except Correct Answers The
price of the product. Income, tastes, and population and
demographics will change demand
A factor of production that can be easily changed in the relevant
time period is called a Correct Answers Variable input
, A firm earns a normal profit when its total revenues just offset
both the ______ cost and ______ cost Correct Answers
Accounting; opportunity
A firm's managers are constrained by Correct Answers
Consumers, workers, and government
A managerial decision is not profitable if Correct Answers It
increases costs more than revenue
A restaurant in an isolated spot on the coast of Maine sells only
complete meals at a fixed price with the opportunity to select a
la carte. What type of price discrimination is being used?
Correct Answers Bundling
Accounting consts Correct Answers Are historical costs
Adam spent $10,000 on new equipment for his small business,
"Adam's Fitness Studio." Membership at his fitness center is
very low and at this rate, Adam needs an additional $12,000 per
year to keep his studio open. Which of the following is true?
Correct Answers The $10,000 Adam spent on equipment is a
fixed cost of business and the $12,000 he'll need to continue
operations is a variable cost
Because the amount of labor a firm emplys can be changed, the
cost of labor is known as a Correct Answers Variable cost
CEOs should focus on Correct Answers Maximizing firm
profits
(T/F) A sale on men's slacks at T.J. Maxx, where if you buy the
first pair at full price, you can buy the second pair at half price,
is an example of differential pricing. Correct Answers True
(T/F) According to the profit maximization goal, the firm should
attempt to maximize short-run profits since there is too much
uncertainty associated with long-run profits Correct Answers
False
(T/F) Accounting costs exclude implicit costs Correct Answers
True
(T/F) Charging a different price for tickets to movies at twilight
than after 6 o'clock is an example of bundling. Correct Answers
False, it is third degree price discrimination
(T/F) Economic costs include implicit costs but no explicit costs
Correct Answers False
A change in all of the following variables will change the
market demand for a product except Correct Answers The
price of the product. Income, tastes, and population and
demographics will change demand
A factor of production that can be easily changed in the relevant
time period is called a Correct Answers Variable input
, A firm earns a normal profit when its total revenues just offset
both the ______ cost and ______ cost Correct Answers
Accounting; opportunity
A firm's managers are constrained by Correct Answers
Consumers, workers, and government
A managerial decision is not profitable if Correct Answers It
increases costs more than revenue
A restaurant in an isolated spot on the coast of Maine sells only
complete meals at a fixed price with the opportunity to select a
la carte. What type of price discrimination is being used?
Correct Answers Bundling
Accounting consts Correct Answers Are historical costs
Adam spent $10,000 on new equipment for his small business,
"Adam's Fitness Studio." Membership at his fitness center is
very low and at this rate, Adam needs an additional $12,000 per
year to keep his studio open. Which of the following is true?
Correct Answers The $10,000 Adam spent on equipment is a
fixed cost of business and the $12,000 he'll need to continue
operations is a variable cost
Because the amount of labor a firm emplys can be changed, the
cost of labor is known as a Correct Answers Variable cost
CEOs should focus on Correct Answers Maximizing firm
profits
