Question 1(Multiple Choice Worth 1 points)

(04.03 MC)

A monopoly firm produces men's collared dress shirts. Its brand is strong and differentiated. The company uses price discrimination to increase its economic profits. Which of the following is correct?

The firm is giving greater benefits to its buyers.

The firm produces the same quantity at a higher variable cost.

Buyers are forced to buy at a higher price because the shirts are scarce.

Those with less elastic demand pay a higher price for the shirts.

A greater quantity than the allocatively efficient quantity is sold, at a price higher than the market price.

Question 6(Multiple Choice Worth 1 points)

(02.05 MC)

The percentage change of any determinant of supply or demand along with the percentage change in quantity can be used to measure a good's

total utility

price elasticity

optimal price point

marginal utility

net benefit

Question 9(Multiple Choice Worth 1 points)

(02.03 MC)

A product is experiencing unit elastic price demand. If it increases its price by 5 percent, what must happen to its quantity demanded?

It must decrease by 5 percent.

It must increase by 5 percent.

It must increase by 5 units.

It must increase by one unit.

It must decrease by one unit.

Question 14(Multiple Choice Worth 1 points)

(06.01 MC)

Which of the following market situations has a long-run equilibrium that is allocatively efficient?

Oligopoly with no externalities

Monopoly with perfect information

Perfect competition with externalities

Perfect competition with no externalities

Perfect competition with asymmetric information

Question 16(Multiple Choice Worth 1 points)

(06.05 MC)

Country A has a Gini coefficient of 0.70, whereas Country B has a Gini coefficient of 0.75. What must be true about these two countries?

Country A has lower economic inequality than Country B.

Country B has lower economic inequality than Country A.

Country A has a lower income per capita than Country B.

Country B has a lower income per capita than Country A.

Country A has a lower standard of living than Country B.

Question 17(Multiple Choice Worth 1 points)

(05.01 MC)

Which of the following could explain an increase in the wage rate for a particular type of labor?

Decreased productivity of each unit of labor

Decreased demand for that type of labor's output

An increase in the supply of that labor

A decrease in the price of a substitute resource

An increase in the price of that labor's output product

Question 21(Multiple Choice Worth 1 points)

(03.02 MC)

If a firm has fixed costs of $1,500 and variable costs of $2,000 at a production level of 100 units of output, then the total cost to produce 100 units will be

$500

$1,500

$2,000

$3,500

indeterminate

Question 24(Multiple Choice Worth 1 points)

(6.03 MC)

Which of the following explains why the government of a state decides to provide free schools for its citizens or to subsidize public schools?

Artificially scarce good

Free rider problem

Positive externality

Negative externality

Tragedy of the commons

Question 25(Multiple Choice Worth 1 points)

(03.02 MC)

Which of the following describes the slope of the long-run average cost curve when achieving economies of scale?

It is flat.

It is positive.

It is negative.

It is negative and then positive.

It is positive and then negative.

Question 26(Multiple Choice Worth 1 points)

(03.05 MC)

The marginal revenue of a pen-producing firm is higher than its marginal cost. Price is higher than average variable cost. Which of the following is true?

An increase in output will increase losses.

A decrease in output will decrease losses.

An increase in output will decrease profits.

An increase in output will increase profits.

A decrease in output will leave profits unchanged.

Question 29(Multiple Choice Worth 1 points)

(06.05 HC)

Which of the following statements about income and wealth distribution is true?

Inheritance distributes wealth more equally.

Progressive tax makes income distribution less equal.

Access to quality education by a few distributes income more equally.

Differences in degree of labor specialization distributes income more equally.

Cultural and religious institutional barriers between markets contribute to income inequality.

Question 30(Multiple Choice Worth 1 points)

(02.09 MC)

Imposing an import quota has which of the following effects?

Raises tax revenue; lowers domestic consumption; increases domestic production

Increases domestic consumption; increases domestic production

Increases domestic supply; decreases domestic demand

Decreases domestic supply; increases domestic quantity demanded

Increases domestic quantity supplied; decreases domestic consumption