CSCC Econ 2200 Hunt FINAL - Assignment Essays

question

Economics is a social science that studies how individuals institutions and society may

answer

Best use scarce resources to achieve the maximum satisfaction of economic wants

question

The process of developing hypothesis testing them against facts and using the result to construct theories is called

answer

The scientific method

question

Which would be a normative economic statement

answer

This administration needs to raise taxes to pay for childcare programs

question

Opportunity cost is best defined as

answer

The value of the best forgone alternative

question

A recurring theme in economics is that people

answer

Have unlimited economic wants but limited resources

question

Tammie makes 150 a day as a bank clerk she takes off two days of work without pay to fly to another city for a concert. The cost of transportation is $250 and then 50$ for the ticket. The opportunity cost of Tammies attendance is:

answer

600$

question

The opportunity cost of constructing a new public highway is the

answer

Value of other goods and services that must be sacrificed to construct the new highway

question

A consumer has 12$ in income and she can buy only two foods apples or bananas. Apples cost 1.50 and bananas are .75. What is the slope of the budget line for apples and bananas if apples were graphed on the horizontal and bananas on the vertical axis?

answer

-2.00

question

The Production posssibilities curve represents

answer

The maximum combinations of products that can be produced with fixed resources and texhnology

question

Refer to the above table (Production Possibilities #10) a change from combination C to B means that

answer

1 unit of steel is given up to get 15 more units of wheat

question

Points C,D,E and H on the above graph indicate (#11)

answer

Efficient use of society scarce resources

question

Refer to the above Production possibilities curves. Curve (A) is the current curve for the economy. A shift from curve a to curve b suggests (#12)

answer

An improvement in capital goods technology but not in consumer goods technology

question

In a command system

answer

The government makes production and allocation decisions

question

All economic systems must answer certain fundamental economic questions. Which is not one of these questions?

answer

Which actions should government take to reduce inflation.

question

Consumer sovereignty and dollar votes guide the market system in dealing with which fundamental question?

answer

What will be produced?

question

Other things being equal, the law of demand suggests that as:

answer

The price of 3-D TVs decreases, the quantity demanded will increase.

question

A higher price reduces the quantity demanded for a product because:

answer

Individuals can afford less of the product and will switch to substitutes

question

Which would be a likely cause of an increase in the demand for pizza?

answer

A health report showing eating pizza reduces stress

question

Supposed that goods A and B are close substitutes. If the price of good A falls, then we would expect an:

answer

Increase in the quantity of A demanded and a decrease in the demand for B

question

Which would have no effect on the demand for motorcycles?

answer

A Change in the cost of steel

question

Which statement is true about supply?

answer

To entice producers to offer more of a good on the market for sale, price must rise

question

Which would cause a rightward shift in the supply curve for telephone service?

answer

A decrease in the wages of telephone workers

question

Refer to the above diagram. The equilibrium price and quantity for milk in this market are: (#23)

answer

1.50 and 28 million gallons

question

Refer to the above table. At a price of $15 per unit, which of the following would exist? (#24)

answer

A shortage of 1,000 units

question

What are the two characteristics that differentiate private goods from public goods?

answer

Rivalry and Excludability

question

Refer to the above supply and demand graph for a public good. If Q1 units of the public good is produced: (#26)

answer

Users are willing to pay more for the public good than it costs to produce it.

question

Which is an example of a negative externality?

answer

Decreased property values in a neighborhood where a disreputable nightclub is operating

question

Deadweight losses occur when the quantity of an output produced is:

answer

less than or greater than the competitive equilibrium quantity

question

When the price of a product is increased 10 percent, the quantity demanded decreases 15 percent. In this range of prices, demand for this product is:

answer

Elastic

question

Along a linear downward sloping demand curve, the price elasticity is demand will be:

answer

Different across each price range

question

Total revenue falls as the price of a good is raised. If the demand do the good is:

answer

Elastic

question

Which is not characteristic of a product with relatively inelastic demand?

answer

There are a large number of good substitutes for the good

question

Cross elasticity of demand is:

answer

Negative for complementary goods

question

Refer to the above table. Which product would be an inferior good? (#34)

answer

Product Y

question

Total utility is best defined by which of the following?

answer

The total satisfaction received from consuming a particular amount of a product

question

Which situation is consistent with the law of diminishing marginal utility?

answer

The more pizza Henry eats, the less he enjoys an additional slice

question

Refer to the above table. What is the marginal utility of the fourth unit? (#37)

answer

question

According to utility theory, when total utility reaches a maximum then marginal utility is:

answer

Equal to Zero

question

A consumer with fixed income will maximize utility when each food is purchased in amounts such that the:

answer

Marginal Utility per dollar spent is the same for all goods

question

A consumer makes purchases of an existing product X such that the marginal utility is 10 and the price is $5. The consumer also tries a new product Y and at the current level of consumption it has a marginal utility of 8 and a price of $1. The utility-maximizing rule suggests that this consumer should:

answer

Increase consumption of product Y and decrease consumption of product X

question

Frank Martins marginal utility from an additional dry martini is three times his marginal utility from an additional bottle of beer. If the price of a bottle of beer is $1, then to maximize utility Frank should only buy:

answer

A martini if it's price is less than $3

question

Economic profits are:

answer

Equal to the difference between accounting profits and implicit costs

question

The main difference between the short run and the long run is that:

answer

In the sort run, some inputs are fixed

question

Marginal product of label refers to the:

answer

Increase in output resulting from employing one more labor

question

Over the range of positive, but diminishing, marginal returns for an input, the total product curve:

answer

Rises at a decreasing rate

question

Refer to the above graph showing the MPL marginal product and the average product o labor (APL). At which quantity of labor employed does diminishing marginal returns set in? (#46)

answer

question

Refer to the above table. The marginal cost of producing the sixth unit of output is: (#47)

answer

$25

question

Refer to the above table. The average variable cost of producing 3 units of output is: (#48)

answer

$9.33

question

The law of diminishing returns explains why:

answer

Total cost eventually rises faster and faster

question

Refer to the above graph. At which point does marginal product equal average product at a level of output? (#50)

answer

Point B

question

Round things, Incs Production process exhibits economies of scale. Currently their long run average cost is $1 per unit. If round things doubles is use of all inputs, it's new long-run average total cost will be:

answer

Less than $1 per unit

question

In a purely competitive industry, each firm:

answer

Can easily enter or exit the industry

question

Price is constant or given to the individual firm selling in a purely competitive market because:

answer

The firms demand curve is downsloping

question

In pure competition, each extra unit of output that a firm sells will yield a marginal revenue that is:

answer

Equal to the price

question

Assume that the price of a product sold by a purely competitive firm is $5. Given the data in the table below, at what output level is total profit highest in the short run? (#55)

answer

question

A firm sells a product in a purely competitive market. The marginal cost of the product at the current output of 500 units is $1.50. The minimum possible average variable cost is $1.00. The market price of the product is $1.25. To maximize profit or minimize losses the firm should:

answer

Produce less than 500 units

question

Refer to the above graph. To maximize profits, the fine should produce the quantity: (#57)

answer

question

Consider the purely competitive firm picture above. The firm is earning: (#58)

answer

Normal profits, since its price just covers ATC

question

Refer to the graphs above for a purely competitive market in the short run. The graphs suggest that in the long run, assuming no changes in the given information: (#59)

answer

New firms will be attracted to the industry

question

One defining characteristic of pure monopoly is that:

answer

The monopolist produces a product with no close substitutes

question

A monopoly is most likely to emerge and be sustained when:

answer

Economies of scale are large relative to market demand

question

The non-discriminating pure monopolist must decrease price on all units of a product sold in order to sell more units. This explains why:

answer

Marginal revenue is less than average revenue (price)

question

A pure monopoly firm will never charge a price in the inelastic range of its demand curve because lowering price to get into this region will:

answer

Decrease total revenue, increase total cost, and decrease profit.

question

A monopolist can sell 8 units of a product per day at a unit price of $12. To sell 9 units, it yet reduce price to $11. The marginal revenue of the 9th unit is:

answer

+$3

question

The date below relate to a pure monopolist and the product it produces. What is the profit-maximizing output and price for this monopolist? (#65)

answer

P=$14 Q=4

question

Refer to the above graph for a profit maximizing monopolist. The firm will sets its price at: (#66)

answer

question

In the short run equilibrium, a monopolists profits:

answer

May be positive, negative, or zero

question

monopolistic competition is characterized by firms:

answer

Producing differentiated products

question

The goal of product differentiation and advertising in monopolistic competition is to make:

answer

Price less of a factor and product differences more of a factor in consumer purchases

question

Monopolistically competitive firms are similar to monopolies in that they have:

answer

Marginal revenues that are less than price

question

The demand curve faced by a monopolistically competitive firm:

answer

Is more elastic than the monopolist's demand curve

question

A monopolistically competitive firm is producing at an output level in the short run where the average total cost is $4.50, price is $4.00, marginal revenue is $2.50, and marginal cost is $2.50. This firm is operating:

answer

With a loss in the short run

question

Refer to the above graph. In the short run, this monopolistically competitive firm will set price at: (#73)

answer

$65 and produce 35 units of output

question

Refer to the above graph. This monopolistically competiré firm is eating economic profits in the short run and: (#74)

answer

Will earn only normal profits in the long run

question

Monopolistic competition is characterized by excess capacity because:

answer

Firms produce at an output level less then the least-cost output

question

Answer the question based on the following payoff matrix for a supply in which the numbers indicate the profit in thousands of dollars for a high price of a low price strategy. Refer to the above payoff matrix. If both firms operate independently and do not collide the most likely profit is: (#76)

answer

It cannot be determined since there are no dominate strategies

question

The linked demand model of oligopoly assumes that:

answer

Rivals will ignore price increases but will match price cuts

question

On the above graph, if the oligopolistic MC curve shifts from MC1 to MC2 the firm will charge: (#78)

answer

A higher price and sell less output; it can't be determined whether total revenue will increase

question

A cartel is:

answer

A formal agreement among firms to collude

question

mutual interdependence means that each firm in an oligopoly:

answer

Considers the reactions of ya rivals when it determines its price policy

question

In a purely competitive labor market, a profit maximizing firm will hire labor up to the point where the marginal revenue price of labor equals the:

answer

Wage rate or price of labor

question

The demand for a productive resource is said to be serviced because the demand for the factor:

answer

Depends on the demand for the product it helps to produce

question

The marginal revenue product of an input in a competitive market decreases as a firm increase the quantity of the input employed because of the:

answer

Law of diminishing returns

question

Marginal resource cost is:

answer

The increase in a firms total cost caused by hiring one additional unit of an input

question

The following is a total product schedule for a resource. Assume that the quantities of other resources the firm employs remain constant. Refer to the above table. If the product the firm produces sells for a constant $2 per unit, the marginal revenue product of the third unit of the resource is:

answer

$24

question

Specialization and trade between individuals or between nations lead to:

answer

Higher total output

question

The principle of comparative advantage indicates that mutually beneficial international trade can take place only when:

answer

Relative costs of production differ between nations

question

The domestic opportunity cost of producing a television in the United States is 20 bushels of wheat. In Korea the domestic opportunity cost of producing a television is 10 bushels of wheat. In this case:

answer

Mutual gains from trade can be obtained if the United States imports televisions from Korea and Korea imports wheat from the United States

question

Countries A and B produce only rubber bands and paper clips inter the Production Possibilities schedules shown below: (#89) in country A the opportunity cost of one paperclip is:

answer

1/2 a rubber band

question

The graph above shows the Production Possibilities curves for two hypothetical nations. Orin and Pohl, which each make two hypothetical products, jaxs and keps. Which of the following statement is correct?

answer

Pohl has a comparative advantage in jaxs

1 of 90

question

Economics is a social science that studies how individuals institutions and society may

answer

Best use scarce resources to achieve the maximum satisfaction of economic wants

question

The process of developing hypothesis testing them against facts and using the result to construct theories is called

answer

The scientific method

question

Which would be a normative economic statement

answer

This administration needs to raise taxes to pay for childcare programs

question

Opportunity cost is best defined as

answer

The value of the best forgone alternative

question

A recurring theme in economics is that people

answer

Have unlimited economic wants but limited resources

question

answer

600$

question

The opportunity cost of constructing a new public highway is the

answer

Value of other goods and services that must be sacrificed to construct the new highway

question

answer

-2.00

question

The Production posssibilities curve represents

answer

The maximum combinations of products that can be produced with fixed resources and texhnology

question

Refer to the above table (Production Possibilities #10) a change from combination C to B means that

answer

1 unit of steel is given up to get 15 more units of wheat

question

Points C,D,E and H on the above graph indicate (#11)

answer

Efficient use of society scarce resources

question

Refer to the above Production possibilities curves. Curve (A) is the current curve for the economy. A shift from curve a to curve b suggests (#12)

answer

An improvement in capital goods technology but not in consumer goods technology

question

In a command system

answer

The government makes production and allocation decisions

question

All economic systems must answer certain fundamental economic questions. Which is not one of these questions?

answer

Which actions should government take to reduce inflation.

question

Consumer sovereignty and dollar votes guide the market system in dealing with which fundamental question?

answer

What will be produced?

question

Other things being equal, the law of demand suggests that as:

answer

The price of 3-D TVs decreases, the quantity demanded will increase.

question

A higher price reduces the quantity demanded for a product because:

answer

Individuals can afford less of the product and will switch to substitutes

question

Which would be a likely cause of an increase in the demand for pizza?

answer

A health report showing eating pizza reduces stress

question

Supposed that goods A and B are close substitutes. If the price of good A falls, then we would expect an:

answer

Increase in the quantity of A demanded and a decrease in the demand for B

question

Which would have no effect on the demand for motorcycles?

answer

A Change in the cost of steel

question

Which statement is true about supply?

answer

To entice producers to offer more of a good on the market for sale, price must rise

question

Which would cause a rightward shift in the supply curve for telephone service?

answer

A decrease in the wages of telephone workers

question

Refer to the above diagram. The equilibrium price and quantity for milk in this market are: (#23)

answer

1.50 and 28 million gallons

question

Refer to the above table. At a price of $15 per unit, which of the following would exist? (#24)

answer

A shortage of 1,000 units

question

What are the two characteristics that differentiate private goods from public goods?

answer

Rivalry and Excludability

question

Refer to the above supply and demand graph for a public good. If Q1 units of the public good is produced: (#26)

answer

Users are willing to pay more for the public good than it costs to produce it.

question

Which is an example of a negative externality?

answer

Decreased property values in a neighborhood where a disreputable nightclub is operating

question

Deadweight losses occur when the quantity of an output produced is:

answer

less than or greater than the competitive equilibrium quantity

question

When the price of a product is increased 10 percent, the quantity demanded decreases 15 percent. In this range of prices, demand for this product is:

answer

Elastic

question

Along a linear downward sloping demand curve, the price elasticity is demand will be:

answer

Different across each price range

question

Total revenue falls as the price of a good is raised. If the demand do the good is:

answer

Elastic

question

Which is not characteristic of a product with relatively inelastic demand?

answer

There are a large number of good substitutes for the good

question

Cross elasticity of demand is:

answer

Negative for complementary goods

question

Refer to the above table. Which product would be an inferior good? (#34)

answer

Product Y

question

Total utility is best defined by which of the following?

answer

The total satisfaction received from consuming a particular amount of a product

question

Which situation is consistent with the law of diminishing marginal utility?

answer

The more pizza Henry eats, the less he enjoys an additional slice

question

Refer to the above table. What is the marginal utility of the fourth unit? (#37)

answer

question

According to utility theory, when total utility reaches a maximum then marginal utility is:

answer

Equal to Zero

question

A consumer with fixed income will maximize utility when each food is purchased in amounts such that the:

answer

Marginal Utility per dollar spent is the same for all goods

question

answer

Increase consumption of product Y and decrease consumption of product X

question

answer

A martini if it's price is less than $3

question

Economic profits are:

answer

Equal to the difference between accounting profits and implicit costs

question

The main difference between the short run and the long run is that:

answer

In the sort run, some inputs are fixed

question

Marginal product of label refers to the:

answer

Increase in output resulting from employing one more labor

question

Over the range of positive, but diminishing, marginal returns for an input, the total product curve:

answer

Rises at a decreasing rate

question

Refer to the above graph showing the MPL marginal product and the average product o labor (APL). At which quantity of labor employed does diminishing marginal returns set in? (#46)

answer

question

Refer to the above table. The marginal cost of producing the sixth unit of output is: (#47)

answer

$25

question

Refer to the above table. The average variable cost of producing 3 units of output is: (#48)

answer

$9.33

question

The law of diminishing returns explains why:

answer

Total cost eventually rises faster and faster

question

Refer to the above graph. At which point does marginal product equal average product at a level of output? (#50)

answer

Point B

question

answer

Less than $1 per unit

question

In a purely competitive industry, each firm:

answer

Can easily enter or exit the industry

question

Price is constant or given to the individual firm selling in a purely competitive market because:

answer

The firms demand curve is downsloping

question

In pure competition, each extra unit of output that a firm sells will yield a marginal revenue that is:

answer

Equal to the price

question

Assume that the price of a product sold by a purely competitive firm is $5. Given the data in the table below, at what output level is total profit highest in the short run? (#55)

answer

question

answer

Produce less than 500 units

question

Refer to the above graph. To maximize profits, the fine should produce the quantity: (#57)

answer

question

Consider the purely competitive firm picture above. The firm is earning: (#58)

answer

Normal profits, since its price just covers ATC

question

Refer to the graphs above for a purely competitive market in the short run. The graphs suggest that in the long run, assuming no changes in the given information: (#59)

answer

New firms will be attracted to the industry

question

One defining characteristic of pure monopoly is that:

answer

The monopolist produces a product with no close substitutes

question

A monopoly is most likely to emerge and be sustained when:

answer

Economies of scale are large relative to market demand

question

The non-discriminating pure monopolist must decrease price on all units of a product sold in order to sell more units. This explains why:

answer

Marginal revenue is less than average revenue (price)

question

A pure monopoly firm will never charge a price in the inelastic range of its demand curve because lowering price to get into this region will:

answer

Decrease total revenue, increase total cost, and decrease profit.

question

A monopolist can sell 8 units of a product per day at a unit price of $12. To sell 9 units, it yet reduce price to $11. The marginal revenue of the 9th unit is:

answer

+$3

question

The date below relate to a pure monopolist and the product it produces. What is the profit-maximizing output and price for this monopolist? (#65)

answer

P=$14 Q=4

question

Refer to the above graph for a profit maximizing monopolist. The firm will sets its price at: (#66)

answer

question

In the short run equilibrium, a monopolists profits:

answer

May be positive, negative, or zero

question

monopolistic competition is characterized by firms:

answer

Producing differentiated products

question

The goal of product differentiation and advertising in monopolistic competition is to make:

answer

Price less of a factor and product differences more of a factor in consumer purchases

question

Monopolistically competitive firms are similar to monopolies in that they have:

answer

Marginal revenues that are less than price

question

The demand curve faced by a monopolistically competitive firm:

answer

Is more elastic than the monopolist's demand curve

question

answer

With a loss in the short run

question

Refer to the above graph. In the short run, this monopolistically competitive firm will set price at: (#73)

answer

$65 and produce 35 units of output

question

Refer to the above graph. This monopolistically competiré firm is eating economic profits in the short run and: (#74)

answer

Will earn only normal profits in the long run

question

Monopolistic competition is characterized by excess capacity because:

answer

Firms produce at an output level less then the least-cost output

question

answer

It cannot be determined since there are no dominate strategies

question

The linked demand model of oligopoly assumes that:

answer

Rivals will ignore price increases but will match price cuts

question

On the above graph, if the oligopolistic MC curve shifts from MC1 to MC2 the firm will charge: (#78)

answer

A higher price and sell less output; it can't be determined whether total revenue will increase

question

A cartel is:

answer

A formal agreement among firms to collude

question

mutual interdependence means that each firm in an oligopoly:

answer

Considers the reactions of ya rivals when it determines its price policy

question

In a purely competitive labor market, a profit maximizing firm will hire labor up to the point where the marginal revenue price of labor equals the:

answer

Wage rate or price of labor

question

The demand for a productive resource is said to be serviced because the demand for the factor:

answer

Depends on the demand for the product it helps to produce

question

The marginal revenue product of an input in a competitive market decreases as a firm increase the quantity of the input employed because of the:

answer

Law of diminishing returns

question

Marginal resource cost is:

answer

The increase in a firms total cost caused by hiring one additional unit of an input

question

answer

$24

question

Specialization and trade between individuals or between nations lead to:

answer

Higher total output

question

The principle of comparative advantage indicates that mutually beneficial international trade can take place only when:

answer

Relative costs of production differ between nations

question

answer

Mutual gains from trade can be obtained if the United States imports televisions from Korea and Korea imports wheat from the United States

question

Countries A and B produce only rubber bands and paper clips inter the Production Possibilities schedules shown below: (#89) in country A the opportunity cost of one paperclip is:

answer

1/2 a rubber band

question

answer

Pohl has a comparative advantage in jaxs

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