Final 4 April 2017, questions and answers PDF
| Title | Final 4 April 2017, questions and answers |
|---|---|
| Course | Economics |
| Institution | University of Saskatchewan |
| Pages | 29 |
| File Size | 1 MB |
| File Type | |
| Total Downloads | 4 |
| Total Views | 70 |
Summary
Econ 115 Final Fall MULTIPLE CHOICE. Choose the one alternative that best completes the statement or answers the question. Statements about ʺwhat ought to beʺ are called A) hypotheses. B) positive statements. C) normative statements. D) scientific statements. E) economic...
Description
Econ115FinalFall2011 MULTIPLECHOICE.Choosetheonealternativethatbestcompletesthestatementoranswersthequestion. 1) Statementsaboutʺwhatoughttobeʺarecalled A) hypotheses. B) positivestatements. C) normativestatements. D) scientificstatements. E) economicstatements.
1)
2) Whichoneofthefollowingdoesnotoccurinperfectcompetition? A) Therearesignificantrestrictionsonentryintothemarket. B) Therearemanybuyers. C) Sellersandbuyersarewellinformedaboutprices. D) Establishedfirmshavenoadvantageovernewones. E) Nosinglefirmcanexertasignificantinfluenceonthemarketpriceofthegood.
2)
3) Inaperfectcompetitivemarket,themarketdemandcurveisillustratedby A) adownward- slopingcurve. B) acurvethatisbowedtowardstheorigin. C) alinethatisverticalatthemarketoutput. D) anupward- slopingcurve. E) alinethatishorizontalatthemarketprice.
3)
Usethefigurebelowtoanswerthefollowingquestions.
Figure12.1.1 4) RefertoFigure12.1.1.CurveArepresentsthefirmʹs A) totalrevenuecurve. B) averagefixedcostcurve. C) marginalrevenuecurve. D) totalfixedcostcurve. E) averagevariablecostcurve.
1
4)
5) RefertoFigure12.1.1.Aisastraightlinebecausethefirm A) hasconstantmarginalcost. B) isapricetaker. C) hasperfectinformation. D) wantstomaximizeprofits. E) facesconstantreturnstoscale.
5)
6) Ifafirmfacesaperfectlyelasticdemandforitsproduct,then A) itwillwanttoraiseitspricetoincreasetotalrevenue. B) itwillalwaysmakezeroeconomicprofit. C) itisnotapricetaker. D) itwillwanttoloweritspricetoincreasesales. E) itsmarginalrevenuecurveishorizontalatthemarketprice.
6)
7) Theslopeofaperfectlycompetitivefirmʹsdemandcurveis A) 1. B) zero. C) negative. D) greaterthan1. E) infinity.
7)
8) Completethefollowingsentence.Marginalrevenueis A) economicprofitdividedbythequantitysold. B) thechangeintotalrevenuethatresultsfromaone- unitincreaseinthequantitysold. C) thechangeineconomicprofitthatresultsfromaone- unitincreaseinthequantitysold. D) totalrevenueminustotalcost. E) thechangeintotalquantitythatresultsfromaone- unitincreaseinthepriceofthegood.
8)
9) Themaximumlossafirmwillexperienceintheshortrunequals A) itstotalvariablecost. B) itsmarginalcost. C) zero. D) itstotalfixedcost. E) itstotalcost.
9)
10) Ifaprofit- maximizingmonopolyisproducinganoutputatwhichmarginalcostexceeds marginalrevenue,it A) shouldraisepriceanddecreaseoutput. B) isincurringaneconomicloss. C) ismaximizingprofit. D) shouldlowerpriceanddecreaseoutput. E) shouldlowerpriceandincreaseoutput.
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10)
Usethefigurebelowtoanswerthefollowingquestions.
Figure13.2.2 11) Forthesingle- pricemonopolyshowninFigure13.2.2,whenprofitismaximized,quantityis A) 5andpriceis$4. B) 4andpriceis$4. C) 3andpriceis$6. D) 3andpriceis$3. E) 4andpriceis$5.
11)
Usethefigurebelowtoanswerthefollowingquestion.
Figure13.2.1 12) RefertoFigure13.2.1.Thissingle- pricemonopolyproduces ________unitsperdayand chargesapriceof$________perunit. A) 40;50 B) 20;20 C) 20;75 D) zero;0 E) 20;50 3
12)
Usethefigurebelowtoanswerthefollowingquestion.
Figure12.2.1 13) RefertoFigure12.2.1,whichshowsaperfectlycompetitivefirmʹstotalrevenueandtotalcost curves.Whichoneofthefollowingstatementsisfalse? A) AtanoutputlessthanQ1 unitsaday,thefirmincursaneconomicloss. B) AtanoutputgreaterthanQ3 unitsaday,thefirmincursaneconomicloss. C) AtanoutputofQ1 unitsaday,thefirmmakeszeroeconomicprofit. D) AtanoutputofQ2 unitsaday,thefirmincursaneconomicloss. E) Economicprofitistheverticaldistancebetweenthetotalrevenuecurveandthetotalcost curve.
13)
14) Acartelis A) anarrangementamongfirmstocapturetheregulator. B) usuallyastableorganization,withnothreatfromcheatersonthecartelarrangements. C) anarrangementtofloodthemarketandeliminatecompetition. D) anarrangementtostealsecretindustrialprocessesfromrivalfirms. E) anarrangementamongfirmstoreduceoutputandraiseprices.
14)
15) Amonopolistunderrateofreturnregulationhasanincentiveto A) maximizeconsumersurplus. B) producemorethantheefficientquantityofoutput. C) maximizeshareholderprofits D) padcosts. E) chargeapriceequaltomarginalcost.
15)
16) Amonopolisticallycompetitivefirmisabletoinfluencethepriceofwhatitsellsbecauseof A) productdifferentiation. B) thefacttherearemanybuyers. C) economiesofscale. D) inelasticdemand. E) barrierstoentry.
16)
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17) Inmonopolisticcompetition,firmscompeteonthebasisof A) priceonly. B) price,quality,andmarketing. C) qualityonly. D) qualityandmarketing,butnotprice. E) marketingonly.
17)
18) Inmonopolisticcompetition A) thegoodsproducedbyeachfirmareidentical. B) firmspracticeproductdifferentiation. C) therearebarrierstoentry. D) firmsdonothaveanycontroloverthepriceoftheirproducts. E) asmallnumberoffirmscompete.
18)
19) Whichofthefollowinggoodsisbestdescribedasbeingsoldinamonopolisticallycompetitive market? A) thelocalnewspaper B) postagestamps C) wheat D) automobiles E) fastfood
19)
20) Onefactorthatdistinguishesamonopolyfrommonopolisticcompetitionisthat A) firmsinmonopolisticcompetitionpracticecollusion. B) nobarrierstoentryexistinamonopoly. C) barrierstoexitexistinmonopolisticcompetition. D) closesubstitutesareavailableinmonopolisticcompetition. E) firmsareprice- takersinmonopolisticcompetition.
20)
5
Usethefigurebelowtoanswerthefollowingquestions.
Figure13.2.3 21) RefertoFigure13.2.3.Assumethisfirmisasingle- pricemonopoly.Howmanyticketsdoes thismonopolistselltomaximizeeconomicprofit? A) 30tickets B) 100tickets C) 60tickets D) 20tickets E) 50tickets
21)
22) Whymightonlyafewfirmsdominateanoligopolisticindustry? A) Perfectlyelasticdemandmakessmall-scaleoperationeconomicallyinefficient. B) Anaturalorlegalbarriertoentryexists. C) Itisduetotheoutcomeoftheprisonersʹdilemma. D) Inelasticmarketdemandleadstothedominationoftheindustrybyafewfirms. E) Decreasingreturnstoscalemaymakesmall-scalefirmsmoreadvantageous.
22)
23) Themarketstructureinwhichnaturalorlegalbarrierspreventtheentryofnewfirmsanda smallnumberoffirmscompeteis A) monopolisticcompetition. B) monopoly. C) duopoly. D) perfectcompetition. E) oligopoly.
23)
6
Usethefigurebelowtoanswerthefollowingquestion.
Figure15.2.1 24) Whichoneofthefollowingstatementsaboutthesectionsofthekinkeddemandcurvein Figure15.2.1iscorrect? A) Thekinkbetweensectionsreflectsmarketimperfections. B) ABassumesotherfirmswillnotmatchapriceincrease,whileBC assumesotherfirms willmatchapricedecrease. C) ABassumesotherfirmswillmatchapriceincrease,whileBC assumesotherfirmswill notmatchapricedecrease. D) ABassumesnonewfirmswillentertheindustry,whileBC assumesnewfirmswillenter. E) ABassumesnewfirmswillentertheindustry,whileBC assumesnonewfirmswillenter.
24)
25) Whichonethefollowingindustriesisthebestexampleofanoligopoly? A) thefast- foodindustry B) theclothingindustry C) therestaurantindustry D) themarketforwheat E) theautomobileindustry
25)
26) Accordingtothekinkeddemandcurvetheoryofoligopoly,eachfirmbelievesthatifitraises itsprice, A) itsprofitwillrisebythesamepercentage. B) thegovernmentwillimposepricecontrols. C) otherfirmswilllowertheirs. D) otherfirmswillraisetheirpricesbyanidenticalamount. E) otherfirmswillnotraisetheirs.
26)
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27) Monopolisticcompetitiondiffersfrommonopolybecauseinmonopolisticcompetition A) firmsarefreetoenterandexit. B) firmsmaximizeprofits. C) firmssetmarginalrevenueequaltomarginalcosttomaximizeprofit. D) Alloftheabovearedifferencesbetweenmonopolyandmonopolisticallycompetitive firms. E) Noneoftheabovearedifferencesbetweenmonopolyandmonopolisticallycompetitive firms.
27)
28) Whichoneofthefollowingquotationsbestdescribesthekinkeddemandcurvemodelof oliogopoly? A) ʺConstructionpricesinthistownseemtobealwayssetbyBigJimʹsDandyConstruction Company.ʺ B) ʺEverytimeSparrowʹsDonutshasadonutsale,sodoesTimHortonʹs.ʺ C) ʺGaspricesinthistownalwaysgoupanddowntogether.ʺ D) Alloftheabove. E) Noneoftheabove.
28)
29) Torontohasalargenumberofretailstoresthatsellclothes.Eachstorehasitsown characteristicswhichdifferfromtheotherstores.TheclothingbusinessinTorontoisan exampleof A) aduopoly. B) amonopoly. C) amonopolisticallycompetitivemarket. D) anoligopoly. E) aperfectlycompetitivemarket.
29)
30) Ifaperfectlycompetitivefirmintheshortrunisabletopayitsvariablecostsandpart,butnot all,ofitsfixedcosts,thenitisoperatingintherangeonitsmarginalcostcurvethatis anywhere A) belowtheshutdownpoint. B) betweentheshutdownandbreak- evenpoints. C) abovethebreak- evenpoint. D) abovetheshutdownpoint. E) belowthebreak- evenpoint.
30)
31) Ifaperfectlycompetitivefirmisproducingintheshortrunatanoutputwherepriceisless thanaveragetotalcost,thefirm A) willshutdown. B) isstillmakingapositiveeconomicprofit. C) isincurringaneconomiclossbutwillcontinuetooperateaslongaspriceisabove minimumaveragevariablecost. D) isbreakingeven. E) isincurringaneconomiclossbutwillcontinuetooperateaslongaspriceisabove minimumaveragefixedcost.
31)
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32) Completethefollowingsentence.Economicmodels A) answerquestionsthatarisefromnormativestatements. B) describesomeaspectoftheeconomicworld,butincludeonlythosefeaturesneededfor thepurposeathand. C) donotanswerquestionsabouttheeconomicworld. D) includemostofthedetailsoftheeconomicworld. E) werefirstdevelopedinthe1970s.
32)
33) Whichoneofthefollowingeventsshiftsthedemandcurveforgrapejellytotheright? A) anincreaseinthepriceofpeanutbutter,acomplementofgrapejelly B) adecreaseinthepriceofgrapejelly C) adecreaseinthepopulation D) anincreaseinincomeifgrapejellyisanormalgood E) adecreaseinthepriceofstrawberrypreserves,asubstituteforgrapejelly
33)
34) Anincreaseinthepriceofgroundbeef A) increasesthedemandforchicken,asubstituteforgroundbeef. B) increasesthequantitydemandedofgroundbeef. C) increasesthedemandforhamburgerbuns,acomplementofgroundbeef. D) decreasesthequantitydemandedofgroundbeef. E) bothAandD.
34)
35) Anincreaseinincome A) decreasesthesupplyofturnips. B) decreasesthedemandforturnipsifturnipshaveaverylowprice. C) increasesthedemandforturnipsifaturnipisaninferiorgood. D) increasesthedemandforturnipsifaturnipisanormalgood. E) increasesthesupplyofturnips.
35)
36) Aturnipisaninferiorgoodif A) turnipsviolatethelawofdemand. B) anincreaseinincomeincreasesthedemandforturnips. C) anincreaseinincomedecreasesthedemandforturnips. D) turnipsarealowqualitygood. E) anincreaseinthepriceofaturnipdecreasesthequantityofturnipsthatconsumerswant tobuy.
36)
37) Whichoneofthefollowingillustratesaninelasticdemand? A) Apriceelasticityofdemandequaltoinfinity. B) Apriceelasticityofdemandequalto2.0. C) Apriceelasticityofdemandequalto1.0. D) A10percentriseinpriceleadstoa5percentdecreaseinquantitydemanded. E) A10percentriseinpriceleadstoa20percentdecreaseinquantitydemanded.
37)
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Usethefigurebelowtoanswerthefollowingquestions.
Figure3.2.1 38) Whichoneofthefollowingstatementsbestcharacterizespoint BinFigure3.2.1? A) Atapriceof$0.50,consumerswillbeunwillingtobuyanyapples. B) Atapriceof$0.50,therewillbeanappleshortage. C) Themostthatconsumerswouldbewillingtopayforthe9,000thappleis$0.50. D) Producerswouldbeunwillingtosellthe9,000thappleforlessthan$0.50. E) AtpointB,themarketisinequilibrium.
38)
39) Anindifferencecurveis A) theboundarybetweenwhataconsumercanaffordandwhathecannotafford. B) theboundarybetweenwhatcanbeproducedandwhatcannotbeproduced. C) alinethatshowscombinationsofgoodsamongwhichaconsumerisindifferent. D) alinewithapositiveslope. E) theboundarybetweennormalgoodsandinferiorgoods.
39)
40) Ifweproduceonemorebottleofwater A) weincuramarginalcost. B) wecannotbeactingefficiently. C) wemustmoveawayfrommarketequilibrium. D) themarginalsocialbenefitfrombottledwaterincreases. E) thepriceofabottleofwatermustrise.
40)
10
Usethefigurebelowtoanswerthefollowingquestion.
Figure9.2.4 41) RefertoFigure9.2.4.Rashidbuysonlybooksandalbums.Thefigureshowshispreferences. Rashidʹsindifferencecurves________displaydiminishingmarginalrateofsubstitution because________. A) do;themagnitudeoftheslopeofbothindifferencecurvesdecreasesasRashidconsumes morealbumsandfewerbooks B) do;Rashidisindifferentbetweenconsuming6albumsand2booksandconsuming2 albumsand3books C) donot;themagnitudeoftheslopeofbothindifferencecurvesdecreasesasRashid consumesmorealbumsandfewerbooks D) donot;Rashidisindifferentbetweenconsuming6albumsand2booksandconsuming2 albumsand3books E) do;thepriceofanalbumdecreasesasRashidincreasesthequantityhebuys
41)
42) Marginalcost A) istheminimumpriceaproducermustreceivetoinducehimtoofferonemoreunitofa goodorserviceforsale. B) decreasesasmoreofagoodorserviceisproduced. C) canbenegative. D) isgreaterthanprice. E) isalwayslessthanprice.
42)
43) Themagnitudeoftheslopeofanindifferencecurveis A) themarginalrateofsubstitution. B) themarginalpropensitytoconsume. C) themarginalrateoftransformation. D) therelativepriceofgoodY. E) themarginalpropensitytosubstitute.
43)
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44) Producersurplusis A) equaltotheopportunitycostofproduction. B) thedifferencebetweenthemaximumpriceconsumersarewillingtopayandthe minimumpriceproducersarewillingtoaccept. C) thepricereceivedforagoodminusitsmarginalcost,summedoverthequantitysold. D) equaltotheareaunderthesupplycurve. E) thetotalamountpaidforthegood.
44)
45) Apriceelasticityofdemandof2meansthata10percentincreaseinpricewillresultina A) 2percentincreaseinquantitydemanded. B) 20percentdecreaseinquantitydemanded. C) 2percentdecreaseinquantitydemanded. D) 5percentdecreaseinquantitydemanded. E) 20percentincreaseinquantitydemanded.
45)
46) Marginalcostisequalto A) totalcostdividedbyoutput. B) theincreaseintotalcostdividedbytheincreaseinoutput. C) theincreaseintotalcostdividedbytheincreaseinlabourinput,giventheamountof capital. D) totalvariablecostminustotalfixedcost. E) theincreaseintotalcostdividedbytheincreaseinvariablecost.
46)
47) IfATCisfalling,thenM Cmustbe A) aboveATC. B) rising. C) falling. D) belowATC. E) equaltoATC.
47)
12
Usethefigurebelowtoanswerthefollowingquestion.
Figure9.2.2 48) Figure9.2.2showsthreeindifferencecurvesforBrenda.Whichoneofthefollowingisnottrue? 48) A) BrendaprefersconsumingatpointD toconsumingateitherpointB orpointC. B) BrendaprefersconsumingatpointD toconsumingatpointA. C) BrendawouldbeequallyhappyconsumingateitherpointB orpointC. D) BrendaprefersconsumingatpointB toconsumingatpointA. E) ThemarginalrateofsubstitutionishigheratpointC thanatpointB. 49) Whichofthefollowingarecorrect?Accordingtothelawofdiminishingreturns, (1)marginalproducteventuallyrises. (2)marginalproducteventuallyfalls. (3)marginalcosteventuallyrises. (4)marginalcosteventuallyfalls. A) (1)and(3) B) (1)and(4) C) (2)and(3) D) (2)and(4) E) (4)
13
49)
Usethefigurebelowtoanswerthefollowingquestions.
Figure11.3.2 50) RefertoFigure11.3.2,whichillustratestheshort- runaverageandmarginalcostcurves.The marginalcostcurveiscurve A) A. B) B. C) C. D) D. E) noneoftheabove.
50)
51) Theaveragevariablecostcurvewillshiftupwardif A) thepriceofthevariableinputincreases. B) thepriceofoutputincreases. C) thepriceofthevariableinputdecreases. D) thereisatechnologicaladvance. E) thereisanincreaseinfixedcost.
51)
52) Atthebestaffordablepoint,whatistherelationshipbetweentheindifferencecurveandthe budgetline? A) Theslopeoftheindifferencecurveexceedstheslopeofthebudgetline. B) Thebudgetlineandtheindifferencecurveareidentical. C) Theslopeofthebudgetlineexceedstheslopeoftheindifferencecurve. D) Theslopeoftheindifferencecurveequalstheslopeofthebudgetline. E) Noneoftheabove.
52)
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Usethefigurebelowtoanswerthefollowingquestions.
Figure11.2.1 53) RefertoFigure11.2.1whichillustratesTaniaʹstotalproductcurve.Whichoneofthefollowing statementsisfalse? A) Allthepointsbelowthecurveareattainable. B) Allthepointsabovethecurveareunattainable. C) Allthepointsonthecurveareattainable. D) ThecostofproducingatpointB equalsthecostofproducingatpointC. E) Allthepointsbelowthecurveareinefficient.
53)
54) Thelawofdiminishingmarginalreturnsstates: A) Asthesizeofafirmʹsplantincreases,averagecosteventuallydecreases. B) Asafirmusesmoreofavariablefactorofproduction,itsaveragecosteventually decreases. C) Asafirmusesmoreofavariablefactororproduction,totalproducteventuallydecreases. D) Asthesizeofaplantincreases,marginalproducteventuallydecreases. E) Asafirmusesmoreofavariablefactorofproduction,withagivenquantityofthefixed factorofproduction,themarginalproductofthevariablefactoreventuallydiminishes.
54)
55) Apriceceilingsetbelowtheequilibriumpricewillresultin A) excessdemand. B) excesssupply. C) anincreaseinsupply. D) adecreaseindemand. E) theequilibriumprice.
55)
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56) Economiesofscalearepresentwhen A) theLRACcurveishorizontal. B) averagetota...
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