Econ Final

rate of return regulation.

A form of regulation that controls a firm's prices and profits based on its costs and capital investments is called:

adding after-school art and music programs to promote creativity

Which policy is MOST likely to contribute to improved standards of living over time?

Its investors face unlimited liability.

Which statement is NOT a characteristic of a corporation?

Sellers have enough inventory to satisfy all buyers and some left over for future demand.

Which statement is NOT true when a market is in equilibrium?

A reduction in business investment causes unemployment to increase.

(Figure) What would be a reason why an economy is operating at point D?

Only I

A firm in a perfectly competitive industry would exhibit which characteristic?

profit; risk

An important tradeoff that entrepreneurs face in their decision making is _____ versus _____.

changes the slope of the budget line.

An increase in the price of one product but not the other:

price system

Another way of referring to a market economy is as a:

diminishing marginal utility.

As a consumer moves downward to the right on an indifference curve, she is willing to give up less of the other good because of:

virtual

As more people rely on a travel app to book reservations, the quality of the app improves, encouraging more people to use the app. This type of network is best described as a _____ network.

rise then fall

As one progresses through his or her working life, the average income tends to _____, holding the level of education constant.

6

At an amusement park, Sue achieves an enjoyment value of 10 on her first roller coaster ride and an enjoyment value of 6 on her second ride. Her marginal benefit from her second ride is:

0.33 kilograms of cocoa.

Based on this table, the opportunity cost of one kilogram of coffee in Kenya is:

less output in order to increase prices.

Compared with a competitive market, a cartel as a whole will produce:

$180; $60

Consider the following numbers at which a monopolist is producing, where MR = MC: Quantity = 20; Price = $9; Average Total Cost = $6. What is the total revenue and profit?

altruism

Helping a friend struggling to pass a math class despite it taking valuable time away from your own studies is an example of:

Area eba

If the amount of emissions being produced is E1, what would be the area representing the deadweight loss to society?

Some firms will exit the market, pushing the market price higher

If the average total cost is $10 and the price is $8 at the profit-maximizing quantity, what will happen in the long run in a perfectly competitive market?

$3,000; 0.875

If the poverty threshold for a family of four is $24,000 and the Shoenfelds earned $21,000, their income deficit is _____ and their ratio of income to poverty is _____.

fall

If the supply of loanable funds increases, the marginal revenue product of capital (MRPK) that would be needed in order to break even would:

lower; higher

If there is a lack of competition in a market, a market failure results because the quantity of goods sold is ___ than the optimal level while prices are ___ than the optimal level.

enter; decrease

In a perfectly competitive industry, short-run economic profits will lead firms to _____ the market, causing market price to _____.

$50

In the graph, calculate the value of consumer surplus in this market.

$80

In the graph, which shows a firm in a perfectly competitive market, calculate the total profit.

$4,000

In the market for surfboards in the graph, with a $100 tariff per imported surfboard, the government collects a total of _____ in tariff revenues.

Casual, Fancy = (4, 8)

In this game table, the Nash equilibrium is:

if the game is repeated over and over under the same conditions

In which situation can a Prisoner's Dilemma outcome most likely be avoided?

an inelastic demand with an elastic supply

In which situation would consumers bear the highest incidence of a tax?

30% more

Jack owns a pumpkin patch and has been selling pumpkins for $10. As Halloween approaches, he worries about having too many unsold pumpkins, so he lowers the price by 20%. If the price elasticity for pumpkins is 1.5, how many more pumpkins will Jack sell?

agency shop

Jack works for a large lumber company. Although he chose not to join the union for personal reasons, he is still required to pay union dues. Jack's company is represented by which form of union?

asymmetric information

Jessica lists her faulty treadmill for sale on craigslist but does not disclose the problems with it. If Blake buys the treadmill believing that it's problem-free, this is an example of market failure due to:

intertemporal pricing

Movies are typically only shown in theaters for months before they are released on online streaming sites at a lower price. This is an example of:

a relative poverty threshold

Poverty is least likely to be eliminated when using which form of measurement?

You pay your neighbor $400 to cut the tree down.

Some of the mangos from your neighbor's mango tree drop into your yard. You don't like mangos and the fallen mangos make it harder to mow your lawn. Your neighbor values the tree at $300, and your cost of dealing with it is $500. If your neighbor has the legal right to keep the tree, what would be an efficient outcome according to the Coase theorem?

20%; 60%

Suppose that the five residents of a small village have the following incomes: $10,000; $20,000; $30,000; $40,000; $50,000. The proportion of total income earned by the lowest two quintiles is _____ and the proportion earned by the highest two quintiles is _____.

Demand and supply both shift right.

Suppose your bank opens up a dozen more branches throughout the city, making it much easier to find an ATM. What happens to the demand and supply curves for this network as it expands?

7.5

The approximate value of deadweight loss created by this profit-maximizing monopolist is:

66

The following shows the costs associated with the number of pets groomed by Janee's Mobile Pet Grooming Service. What is the value of X?

0.4

The local convenience store advertises 50% off frozen slushies. As a result of the sale, the store sells 80% more slushies, but 20% fewer fountain drinks. The cross elasticity between slushies and fountain drinks is _____.

limited liability of risk

The main advantage of issuing stock to raise financial capital is:

An increase in tariffs to protect domestic industries from foreign competition.

Which of these would be least likely to increase economic growth?

a

Which point would represent a vicious cycle if a firm stays there too long?

the value of attending the class he decided to miss

Tim woke up this morning with a stomachache and decided to skip class in order to get more rest. What is the opportunity cost of Tim's decision to sleep in?

decrease; decrease

Under monopolistic competition, entry typically causes price to _____ and profits to _____.

wages would rise and labor quantity would fall

What would happen to wages and labor if worker safely regulations were abolished, making work conditions more dangerous?

production efficiency but not necessarily allocative efficiency.

When an economy uses the most efficient means of farming to grow as much corn as possible, this economy has achieved:

a decrease in the price of green tea

Which factor would NOT cause the demand curve for green tea to shift to the right?

a large reduction in the price of wheels used to produce skateboards

Which factor would shift the supply of skateboards to the right?

only the individual labor supply curve

Which labor supply curves will bend backward at high wages?

One of the countries has a comparative advantage in the production of both products.

Which of the following is not possible for two countries who trade computers and automobiles with one another?

in the short run

Which of the following periods describes when companies can alter output but not their plant capacity?

The number of hours that existing employees work.

Which of the inputs can be altered in the short run?

an increase in trade protectionism policies to restrict outsourcing of jobs

Which of these does not describe the trend of labor markets over the past 50 years?

environmental protection

Which of these is a pure public good?

the choice of city where one lives

Which of these is not a common cause of income inequality?

soybean farming

Which of these is not a major cause of greenhouse gas emissions?

a reduction in deadweight loss

Which of these is not a problem caused by an effective price ceiling being placed on the price of electricity?

a bank loan used to start a new business

Which of these would NOT be considered a factor of production?

Foreign companies tend to reduce the overall number of jobs available in developing countries.

Which statement is generally NOT true with regard to the effect of trade on wages in developing countries?

It causes prices of imported goods to rise.

Which statement is not a common argument against free trade?

The total product curve reaches its peak when marginal product is zero.

Which statement is true regarding the total product and marginal product curves?

allowing unwanted concert tickets to be sold on StubHub

Which strategy makes price discrimination more difficult for a firm?

The marginal benefit of the second round of golf in the same day is likely to be less than the first round.

Why might the following quote not make economic sense: "The round of golf I just finished was so much fun and worth the money that I should play another round before going back to work"?