ap microeconomics module 69-78

question

Which of the following is an sxample of physical capital?
A. manual labor
B. welding equipment
C. farm land
D. lumber
E. education

answer

B. welding equipment

question

which of the following can shift the factor demand curve to the right?
I. An increase in the price of the good being produced
II. An increase in the factors marginal productivity
III. a technological advance

answer

E. I, II, and III

question

factor market demand is called a derived demand because it

answer

D. is derived from the product market

question

which factor of production receives the largest portion of income in the U.S.?

answer

B. labor

question

the individual firms demand curve for labor is

answer

A. the VMPL curve

question

the implicit cost of capital that you own is

answer

A. the rental rate

question

which of the following is true in relation to a very steep supply curve for land?
I. it is relatively elastic
II. the quantity of land is very responsive to price changes
III. Finding new supplies of land is relatively expensive and difficult

answer

C. III only

question

the explicit cost of land you don't own is equal to the

answer

A. rental rate

question

a firm will continue to employ more land until its value of the marginal product of land is

answer

C. equal to the rental rate

question

according to the marginal productivity theory of income distribution,

answer

E. each factor is paid the equilibrium value of its marginal product

question

which of the following is necessarily true if you work more when your wage rate increases?

answer

D. the substitution effect dominates the income effect

question

which of the following will cause you to work more as your wage rate decrease?
I. the income effect
II. the substitution effect
III. a desire for leisure

answer

A. I only

question

which of the following will shift the supply curve for labor to the right?

answer

E. an increase in labor market opportunities for women

question

an increase in the wage rate will

answer

C. cause an upward movement along the labor supply curve

question

the factor demand curve for a firm in an imperfectly competitive factor market is the same as which of the following curves?

answer

D. MRP

question

an automobile factory employs either assembly line workers or robotic arms to produce automobile engines. in this case, labor and capital are considered

answer

C. substitutes

question

If an increase in the amount of capital employed by a firm leads to an increase in the marginal product of labor, labor and capital are considered

answer

B. complements

question

If the marginal product of labor per dollar is greater than the marginal product of capital per dollar, which of the following is true? the firm should

answer

C. hire more labor

question

the cost-minimization rule states that costs are minimized when

answer

A. MP per dollar is equal for all factors.

question

a firm currently produces its desired level of output. It's marginal product of labor is 400, its marginal product of capital is $1,000, the wage rate is $20 and the rental rate of capital is $100. In that case, the firm should

answer

D. employ less capital and more labor

question

which group of U.S. workers had the highest median earnings in 2009?

answer

A. white males

question

which of the following sources of wage differences is/are consistent with the marginal productivity theory of income distribution?

answer

A. I only

question

compensating differentials mean that which of the following leads to higher wages for some jobs?

answer

A. danger

question

which of the following is a result in the efficiency-wage model?

answer

B. surpluses of labor

question

which of the following statements regarding the marginal productivity theory of income distribution is correct?

answer

E. With well- functioning labor markets, each factor is paid the equilibrium value of the marginal product of that factor

question

The socially optimal level of pollution is

answer

A. less than that caused by the market, but not zero.

question

Which of the following is a source of negative externalities?

answer

A. loud conversation in a library

question

Inefficiencies created by externalities can be dealt with through

answer

D. either private or government actions.

question

The Coase theorem asserts that, under the right circumstances, inefficiencies created by externalities can be dealt with through

answer

B. private bargaining

question

Which of the following makes it more likely that private solutions to externality problems will succeed?

answer

D. a small number of affected parties

question

Which of the following policy tools is inefficient even when correctly administered?

answer

A. environmental standards

question

An efficient Pigouvian subsidy for a good is set equal to the good's

answer

D. marginal external benefit

question

Which of the following is true in the case of a positive externality?

answer

C. MSB > MPB

question

One example of a source of external benefits is

answer

A. technology spillover

question

Marginal social benefit equals marginal private benefit plus

answer

A. marginal external benefit

question

Which of the following types of goods are always nonrival in consumption?

answer

A. public goods

question

The free-rider problem occurs in the case of

answer

B. common resources

question

Public goods are sometimes provided through which of the following means?
I. voluntary contributions
II. individual self-interest
III. the government

answer

E. I, II, and III

question

Market provision of a public good will lead to

answer

D. inefficiently low production of the good

question

The overuse of a common resource can be reduced by which of the following?
A. a Pigouvian tax
B. government regulations
C. tradable licenses
D. the assignment of property rights
E. all of the above

answer

E. all of the above

question

The Sherman Antitrust Act of 1890 sought t do which of the following?

answer

E. all of the above

question

A natural monopoly exists when, over the relevant range, increasing the output levels results in a lower

answer

B. average total cost

question

Which of the following is the most common policy approach to a natural monopoly?

answer

B. price regulation

question

Without government intervention, a monopolist will produce _______________ and charge ___________.

answer

C. Q2, P1

question

The lowest regulated price the government could expect this monopolist to maintain in the long run is

answer

C. P3

question

Which of the following is true of the U.S. poverty rate?

answer

A. It fell in the 1960s.

question

In 2009, approximately what percentage of the U.S. population lived in poverty?

answer

B. 12%

question

Average household income in the United States in 2008 was approximately?

answer

E. $68,000

question

Programs designed to help only those with low incomes are called

answer

C. means-tested programs

question

If a country has a perfectly equal distribution of income, its Gini coefficient equals

answer

A. 0

1 of 50

question

Which of the following is an sxample of physical capital?
A. manual labor
B. welding equipment
C. farm land
D. lumber
E. education

answer

B. welding equipment

question

answer

E. I, II, and III

question

factor market demand is called a derived demand because it

answer

D. is derived from the product market

question

which factor of production receives the largest portion of income in the U.S.?

answer

B. labor

question

the individual firms demand curve for labor is

answer

A. the VMPL curve

question

the implicit cost of capital that you own is

answer

A. the rental rate

question

answer

C. III only

question

the explicit cost of land you don't own is equal to the

answer

A. rental rate

question

a firm will continue to employ more land until its value of the marginal product of land is

answer

C. equal to the rental rate

question

according to the marginal productivity theory of income distribution,

answer

E. each factor is paid the equilibrium value of its marginal product

question

which of the following is necessarily true if you work more when your wage rate increases?

answer

D. the substitution effect dominates the income effect

question

which of the following will cause you to work more as your wage rate decrease?
I. the income effect
II. the substitution effect
III. a desire for leisure

answer

A. I only

question

which of the following will shift the supply curve for labor to the right?

answer

E. an increase in labor market opportunities for women

question

an increase in the wage rate will

answer

C. cause an upward movement along the labor supply curve

question

the factor demand curve for a firm in an imperfectly competitive factor market is the same as which of the following curves?

answer

D. MRP

question

an automobile factory employs either assembly line workers or robotic arms to produce automobile engines. in this case, labor and capital are considered

answer

C. substitutes

question

If an increase in the amount of capital employed by a firm leads to an increase in the marginal product of labor, labor and capital are considered

answer

B. complements

question

If the marginal product of labor per dollar is greater than the marginal product of capital per dollar, which of the following is true? the firm should

answer

C. hire more labor

question

the cost-minimization rule states that costs are minimized when

answer

A. MP per dollar is equal for all factors.

question

answer

D. employ less capital and more labor

question

which group of U.S. workers had the highest median earnings in 2009?

answer

A. white males

question

which of the following sources of wage differences is/are consistent with the marginal productivity theory of income distribution?

answer

A. I only

question

compensating differentials mean that which of the following leads to higher wages for some jobs?

answer

A. danger

question

which of the following is a result in the efficiency-wage model?

answer

B. surpluses of labor

question

which of the following statements regarding the marginal productivity theory of income distribution is correct?

answer

E. With well- functioning labor markets, each factor is paid the equilibrium value of the marginal product of that factor

question

The socially optimal level of pollution is

answer

A. less than that caused by the market, but not zero.

question

Which of the following is a source of negative externalities?

answer

A. loud conversation in a library

question

Inefficiencies created by externalities can be dealt with through

answer

D. either private or government actions.

question

The Coase theorem asserts that, under the right circumstances, inefficiencies created by externalities can be dealt with through

answer

B. private bargaining

question

Which of the following makes it more likely that private solutions to externality problems will succeed?

answer

D. a small number of affected parties

question

Which of the following policy tools is inefficient even when correctly administered?

answer

A. environmental standards

question

An efficient Pigouvian subsidy for a good is set equal to the good's

answer

D. marginal external benefit

question

Which of the following is true in the case of a positive externality?

answer

C. MSB > MPB

question

One example of a source of external benefits is

answer

A. technology spillover

question

Marginal social benefit equals marginal private benefit plus

answer

A. marginal external benefit

question

Which of the following types of goods are always nonrival in consumption?

answer

A. public goods

question

The free-rider problem occurs in the case of

answer

B. common resources

question

Public goods are sometimes provided through which of the following means?
I. voluntary contributions
II. individual self-interest
III. the government

answer

E. I, II, and III

question

Market provision of a public good will lead to

answer

D. inefficiently low production of the good

question

The overuse of a common resource can be reduced by which of the following?
A. a Pigouvian tax
B. government regulations
C. tradable licenses
D. the assignment of property rights
E. all of the above

answer

E. all of the above

question

The Sherman Antitrust Act of 1890 sought t do which of the following?

answer

E. all of the above

question

A natural monopoly exists when, over the relevant range, increasing the output levels results in a lower

answer

B. average total cost

question

Which of the following is the most common policy approach to a natural monopoly?

answer

B. price regulation

question

Without government intervention, a monopolist will produce _______________ and charge ___________.

answer

C. Q2, P1

question

The lowest regulated price the government could expect this monopolist to maintain in the long run is

answer

C. P3

question

Which of the following is true of the U.S. poverty rate?

answer

A. It fell in the 1960s.

question

In 2009, approximately what percentage of the U.S. population lived in poverty?

answer

B. 12%

question

Average household income in the United States in 2008 was approximately?

answer

E. $68,000

question

Programs designed to help only those with low incomes are called

answer

C. means-tested programs

question

If a country has a perfectly equal distribution of income, its Gini coefficient equals

answer

A. 0

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