WGU C211 OA GLOBAL ECONOMICS FOR
MANAGERS EXAM DETAILED PREPARATION
PACK 2026
◉ What are the possible benefits of being a late mover? Answer:
Opportunity to free ride on first-mover investments
First mover's difficulty to adapt to market changes
Resolution of technological and market uncertainty
◉ Assume that a firm is looking to expand into a foreign market, but
it needs an opportunity that has low development costs and little
risk. Its best choice would be: Answer: a contractual agreement.
◉ Assume that a major technology company is looking to expand
into a foreign market but it can't risk losing its core innovations by
sharing them with anyone outside the corporation. Its best choice
would be: Answer: a wholly owned subsidiary.
◉ The price leader's _____ is defined as sufficient resources
possessed to deter and combat defection. Answer: capacity to
punish
,◉ _____ is defined as the extent to which a given competitor
possesses strategic endowment comparable, in terms of both type
and amount, to those of the focal firm. Answer: Resource similarity
◉ Which of the following sets of words describes the initial set of
actions a firm uses to gain competitive advantage and the other
firm's response to it? Answer: Attack, counterattack
◉ When firms indirectly coordinate actions by signaling their
intentions, often in an attempt to reduce output and maintain
pricing above competitive levels, they are engaging in: Answer: tacit
collusion.
◉ Which of the following is NOT a method used by competitors to
signal their intention to reduce competitive intensity to other
competitors? Answer: Developing new markets where there is less
competition
◉ How do firms create value when engaging rivals? Answer: Launch
products in multiple markets.
Hold a dominant position in key markets.
Secure patents on key products.
◉ On a graph, consumer surplus is represented by the area
a. below the price and above the supply curve.
,b. below the demand curve and above price.
c. between the demand and supply curves.
d. below the demand curve and to the right of equilibrium price.
Answer: below the demand curve and above price.
◉ A drought in California destroys many red grapes causing the
prices of both red grapes and red wine to rise . As a result, the
consumer surplus in the market for red grapes
a. decreases, and the consumer surplus in the market for red wine
decreases.
b. decreases, and the consumer surplus in the market for red wine
increases.
c. increases, and the consumer surplus in the market for red wine
increases.
d. increases, and the consumer surplus in the market for red wine
decreases. Answer: decreases, and the consumer surplus in the
market for red wine decreases.
◉ If a consumer places a value of $15 on a particular good and if the
price of the good is $17, then the
a. price of the good will fall due to market forces.
b. market is not a competitive market.
c. consumer has consumer surplus of $2 if he or she buys the good.
, d. consumer does not purchase the good. Answer: consumer does
not purchase the good.
◉ Henry is willing to pay 45 cents, and Janine is willing to pay 55
cents, for 1 pound of bananas. When the price of bananas falls from
50 cents a pound to 40 cents a pound,
a. Janine experiences an increase in consumer surplus, but Henry
does not.
b. Henry experiences an increase in consumer surplus, but Janine
does not.
c. neither Janine nor Henry experiences an increase in consumer
surplus.
d. both Janine and Henry experience an increase in consumer
surplus. Answer: both Janine and Henry experience an increase in
consumer surplus.
◉ Import quotas and tariffs produce some common results. Which
of the following is not one of those common results?
a. Producer surplus in the domestic country always increases.
b. The domestic country always experiences a deadweight loss.
c. Equal revenue is always raised for the domestic government.
d. Total surplus in the domestic country always falls. Answer: Equal
revenue is always raised for the domestic government.
MANAGERS EXAM DETAILED PREPARATION
PACK 2026
◉ What are the possible benefits of being a late mover? Answer:
Opportunity to free ride on first-mover investments
First mover's difficulty to adapt to market changes
Resolution of technological and market uncertainty
◉ Assume that a firm is looking to expand into a foreign market, but
it needs an opportunity that has low development costs and little
risk. Its best choice would be: Answer: a contractual agreement.
◉ Assume that a major technology company is looking to expand
into a foreign market but it can't risk losing its core innovations by
sharing them with anyone outside the corporation. Its best choice
would be: Answer: a wholly owned subsidiary.
◉ The price leader's _____ is defined as sufficient resources
possessed to deter and combat defection. Answer: capacity to
punish
,◉ _____ is defined as the extent to which a given competitor
possesses strategic endowment comparable, in terms of both type
and amount, to those of the focal firm. Answer: Resource similarity
◉ Which of the following sets of words describes the initial set of
actions a firm uses to gain competitive advantage and the other
firm's response to it? Answer: Attack, counterattack
◉ When firms indirectly coordinate actions by signaling their
intentions, often in an attempt to reduce output and maintain
pricing above competitive levels, they are engaging in: Answer: tacit
collusion.
◉ Which of the following is NOT a method used by competitors to
signal their intention to reduce competitive intensity to other
competitors? Answer: Developing new markets where there is less
competition
◉ How do firms create value when engaging rivals? Answer: Launch
products in multiple markets.
Hold a dominant position in key markets.
Secure patents on key products.
◉ On a graph, consumer surplus is represented by the area
a. below the price and above the supply curve.
,b. below the demand curve and above price.
c. between the demand and supply curves.
d. below the demand curve and to the right of equilibrium price.
Answer: below the demand curve and above price.
◉ A drought in California destroys many red grapes causing the
prices of both red grapes and red wine to rise . As a result, the
consumer surplus in the market for red grapes
a. decreases, and the consumer surplus in the market for red wine
decreases.
b. decreases, and the consumer surplus in the market for red wine
increases.
c. increases, and the consumer surplus in the market for red wine
increases.
d. increases, and the consumer surplus in the market for red wine
decreases. Answer: decreases, and the consumer surplus in the
market for red wine decreases.
◉ If a consumer places a value of $15 on a particular good and if the
price of the good is $17, then the
a. price of the good will fall due to market forces.
b. market is not a competitive market.
c. consumer has consumer surplus of $2 if he or she buys the good.
, d. consumer does not purchase the good. Answer: consumer does
not purchase the good.
◉ Henry is willing to pay 45 cents, and Janine is willing to pay 55
cents, for 1 pound of bananas. When the price of bananas falls from
50 cents a pound to 40 cents a pound,
a. Janine experiences an increase in consumer surplus, but Henry
does not.
b. Henry experiences an increase in consumer surplus, but Janine
does not.
c. neither Janine nor Henry experiences an increase in consumer
surplus.
d. both Janine and Henry experience an increase in consumer
surplus. Answer: both Janine and Henry experience an increase in
consumer surplus.
◉ Import quotas and tariffs produce some common results. Which
of the following is not one of those common results?
a. Producer surplus in the domestic country always increases.
b. The domestic country always experiences a deadweight loss.
c. Equal revenue is always raised for the domestic government.
d. Total surplus in the domestic country always falls. Answer: Equal
revenue is always raised for the domestic government.
