Test Bank for Managerial Economics 9th Edition by William F. Samuelson, All Chapters Included

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:7jCh01;7jCHAPTER7j1:7jIntroduction7jto7jEconomic7jDecision7jMaki

ng7jMULTIPLE7jCHOICE

1. Managerial7jeconomics7jcan7jbest7jbe7jdefined7jas7jthe:
a) macroeconomics7jand7jmicroeconomics7jfor7jmanagers.
b) study7jof7jeconomic7jincentives7jon7jconsumer7jbehavior7jand7jdemand.
c) analysis7jof7jthe7jlabor7jmarket7jthrough7jthe7jbehavior7jof7jworkers7jand7jmanagers.
d) analysis7jof7jmajor7jmanagement7jdecisions7jusing7jeconomic7jtools.
e) study7jof7jthe7jstrategic7jinteraction7jbetween7jfirms7jin7ja7jmarket.

ANSWER:7jd
SECTION7jREFERENCE:7jIntroduction7j
DIFFICULTY7jLEVEL:7jEasy



2. Which7jof7jthe7jfollowing7jis7jnot7jone7jof7jthe7jsteps7jin7jmanagerial7jdecision7jmaking?
a) Predicting7jthe7jconsequences7jof7ja7jdecision.
b) Exploring7jthe7jalternatives7jto7jthe7jdecision.
c) Defining7jthe7jproblem7jand7jthe7jobjectives7jof7jthe7jdecision.
d) Negotiating7ja7jconsensus7jto7jimplement7jthe7jdecision.
e) Performing7jsensitivity7janalysis.

ANSWER:7jd
SECTION7jREFERENCE:7jSix7jSteps7jto7jDecision7jMaking7jDIFFIC
ULTY7jLEVEL:7jEasy



3. Profit7jmaximization7jis7jan7jambiguous7jguide7jto7jdecision7jmaking7jin7jthe7jprivate7jsector7jbecaus
e:
a) firms7jin7jthe7jprivate7jsector7jusually7jdo7jnot7jaim7jat7jprofit7jmaximization.
b) the7jgoal7jof7jprofit7jmaximization7jcontradicts7jthe7jgoal7jof7jsatisfying7jthe7jfirm‘s7jshareholders.
c) of7jthe7jpresence7jof7jrisk7jand7juncertainty.
d) profit-maximization7jignores7jsocial7jcosts7jand7jbenefits.
e) None7jof7jthe7jabove7janswers7jis7jcorrect.

ANSWER:7jc
SECTION7jREFERENCE:7jSix7jSteps7jto7jDecision7jMaking7jDIFFIC
ULTY7jLEVEL:7jEasy

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,4. Which7jof7jthe7jfollowing7jis7jtrue7jof7jeconomic7jmodels?
a) Models7jare7jtoo7jtheoretical7jto7jbe7japplicable7jin7jreal7jworld7jdecisions.
b) Models7jare7jnot7juseful7jbecause7juncertainty7jprevents7jaccurate7jforecasts.
c) Models7jare7jsimplified7jdescriptions7jof7jprocesses,7jrelationships,7jor7jother7jphenomena.
d) Models7jdescribe7jreal7jworld7jsituations7jin7jcomplete7jdetail.
e) Models7jare7jnot7juseful7jbecause7jthey7jdo7jnot7jtake7jinto7jaccount7jcomplicating7jan
d7jless7jimportant7jfeatures7jof7ja7jproblem.

ANSWER:7jc
SECTION7jREFERENCE:7jSix7jSteps7jto7jDecision7jMaking7jDIFFIC
ULTY7jLEVEL:7jMedium



5. Which7jof7jthe7jfollowing7jcorrectly7jdescribes7ja7jdeterministic7jeconomic7jmodel?
a) A7jdeterministic7jmodel7jis7ja7jmodel7jfor7jwhich7jthe7joutcome7jis7jpredicted7jwith7jcertainty.
b) A7jdeterministic7jmodel7jcan7jonly7jbe7jused7jto7jexplain7jshort-run7jeconomic7jphenomena.
c) A7jdeterministic7jmodel7jis7jmost7juseful7jin7jidentifying7jlong-term7jtrends.
d) A7jdeterministic7jmodel7jis7jused7jin7jthe7jstudy7jof7jnormative7jeconomics.
e) The7joutcome7jof7ja7jdeterministic7jmodel7jis7jrandom7jand7jhas7jprobabilities7jattached.

ANSWER:7ja
SECTION7jREFERENCE:7jSix7jSteps7jto7jDecision7jMaking7jDIFFIC
ULTY7jLEVEL:7jEasy



6. Which7jof7jthe7jfollowing7jcorrectly7jexplains7ja7jprobabilistic7jmodel?
a) A7jprobabilistic7jmodel7jgives7ja7jdescription7jof7jreal7jworld7jeconomic7jphenomena.
b) A7jprobabilistic7jmodel7jshows7jthe7jpossibility7jof7ja7jrange7jof7joutcomes.
c) A7jprobabilistic7jmodel7jexamines7jthe7jchanges7jin7jeconomic7jvariables7jover7ja7jperiod7jof7jtim
e.
d) A7jprobabilistic7jmodel7jis7jbased7jon7jvalue7jjudgments.
e) A7jprobabilistic7jmodel7jis7jused7jto7jexplain7jlong-run7jeconomic7jphenomena

ANSWER:7jb
SECTION7jREFERENCE:7jSix7jSteps7jto7jDecision7jMaking7jDIFFIC
ULTY7jLEVEL:7jEasy



7. Maximizing7jprofit7jby7jenumerating7jthe7jprofit7joutcomes7jof7jdifferent7jcourses7jof7jaction
a) Is7jonly7japplicable7jto7jproblems7jwith7ja7jsmall7jnumber7jof7jalternatives.
b) Becomes7jincreasingly7jcostly7jas7jthe7jnumber7jof7jchoices7jincrease.
c) Always7jdiscovers7jthe7jbest7jpossible7jchoice.

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, d) Provides7ja7juseful7jshortcut7jto7jfinding7jthe7joptimal7jchoice.
e) Answers7jb7jand7jc7jare7jboth7jcorrect.

ANSWER:7jb
SECTION7jREFERENCE:7jSix7jSteps7jto7jDecision7jMaking7jDIFFIC
ULTY7jLEVEL:7jMedium



8. A7jbeverages7jcompany7jwants7jto7jlaunch7ja7jnew7jdiet7jsoda7jaimed7jat7jdiabetics7jand7jhea
lth-7jconscious7jcustomers.7jIt7jwill7juse7ja7j
economic7jmodel7jto7jidentify7jits7jtarget7jcustome
rs.
a) deterministic
b) dynamic
c) qualitative
d) stochastic
e) probabilistic

ANSWER:7ja
SECTION7jREFERENCE:7jSix7jSteps7jto7jDecision7jMaking7jDIFFIC
ULTY7jLEVEL:7jMedium



9. Given7jthat7jthe7jmarket7jshare7jof7ja7jfirm7jdepends7jon7jmany7junpredictable7jfactors,7ja7jfirm7j
will7juse7ja7j economic7jmodel7jto7jestimate7jthe7jmarket7jshare7jfor7jone7jof7jits7jproducts.
a) deterministic
b) dynamic
c) qualitative
d) probabilistic
e) comparative7jstatics

ANSWER:7jd
SECTION7jREFERENCE:7jSix7jSteps7jto7jDecision7jMaking7jDIFFIC
ULTY7jLEVEL:7jMedium



10. Sensitivity7janalysis7jis7jused7jby7ja7jfirm7jto:
a) analyze7jthe7jimpact7jof7ja7jchange7jin7jthe7jprice7jof7jthe7jgood7jon7jthe7jdemand7jfor7jthe7jgood.
b) examine7jthe7jstatic7jeffects7jof7jan7jeconomic7jdecision7jon7jthe7jfirm‘s7jprofitability.
c) analyze7jthe7jsocial7jcosts7jand7jbenefits7jof7jan7jeconomic7jdecision.
d) examine7jthe7jopportunity7jcosts7jof7jan7jeconomic7jdecision.
e) examine7jhow7jan7joptimal7jdecision7jis7jaffected7jif7jkey7jeconomic7jfacts7jvary.

ANSWER:7je
SECTION7jREFERENCE:7jSix7jSteps7jto7jDecision7jMaking
1-3

, DIFFICULTY7jLEVEL:7jEasy



11. A7jcosmetics7jcompany7jis7jconducting7ja7jsecond-
year7jreview7jof7jone7jof7jits7jnewest7jproducts.7jThe7jmarketing7jdepartment7jexpects7jthat7jthe7j
firm7jwill7jcontinue7jto7jearn7jprofits7jfrom7jthe7jsale7jof7jthe7jproduct7jin7jthe7jthird7jyear7jas7jit7j
did7jin7jthe7jpast7jtwo7jyears.7jSenior7jmanagement,7jhowever,7jfeels7jthat7jthe7jprofit7jprojectio
ns7jwould7jvary7jbased7jon7jother7jfactors7jsuch7jas7jthe7jprice7jof7jthe7jcompetitor's7jproducts,7jt
he7jactual7jlevel7jof7jsales,7jand7jthe7jpossibility7jof7jcost7jreductions.7jIn7jother7jwords,7jthe7jse
nior7jmanagement7jis7jundertaking7j .
a) a7jsensitivity7janalysis
b) an7jenumeration7jstudy
c) a7jbenefit-cost7janalysis
d) a7jcontingent7jvaluation7jstudy
e) a7jstrategic7janalysis

ANSWER:7ja
SECTION7jREFERENCE:7jSix7jSteps7jto7jDecision7jMaking7jDIFFIC
ULTY7jLEVEL:7jMedium



12. According7jto7jthe7jsatisficing7jmodel7jof7jmanagement7jbehavior,7jthe7jgoal7jof7ja7jfirm7jis7jto:
a) satisfy7jcustomers,7jemployees,7jand7jshareholders.
b) maximize7jthe7jgain7jto7jsociety7jand7jnot7jjust7jto7jshareholders.
c) achieve7ja7jsatisfactory7jlevel7jof7jperformance7jagainst7ja7jbenchmark.
d) maximize7jsales7jrevenue7jand7jnot7jnecessarily7jthe7jvalue7jof7jthe7jfirm.
e) maximize7jits7jmarket7jshare7jeven7jat7jthe7jcost7jof7jprofit.

ANSWER:7jc
SECTION7jREFERENCE:7jPrivate7jand7jPublic7jDecisions:7jAn7jEconomic7jView7jDIFFICU
LTY7jLEVEL:7jEasy



13. According7jto7jthe7jtheory7jof7jthe7jfirm,7jthe7jmanagement‘s7jultimate7jobjective7jis7jto:
a) maximize7jshort-term7jprofit,7jeven7jif7jthis7jsacrifices7jlong-term7jprofit.
b) maximize7jthe7jvalue7jof7jthe7jfirm.
c) increase7jproduction7jto7jthe7jhighest7jpossible7jlevel.
d) increase7jthe7jmarket7jshare7jof7jthe7jfirm.
e) diversify7jinto7jas7jmany7jproduct7jlines7jas7jthe7jfirm7jcan.

ANSWER:7jb
SECTION7jREFERENCE:7jPrivate7jand7jPublic7jDecisions:7jAn7jEconomic7jView7jDIFFICU
LTY7jLEVEL:7jEasy



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