econ203 full course latest 2015 november [ all discussions all homework and all quizes ]

homework 1

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Chapter 1_ a command economy

Question 1 1 / 1 point

In countries like _____________ the command economy predominates.

a) Germany and France

b) Cuba and North Korea

c) China and Vietnam

d) South Africa and Kenya

Chapter 1_market-oriented economy

Question 2 1 / 1 point

Because of their relatively small national economies, which of the following is most likely considered to be the most important factor for Belgium, Korea, and Canada to take full advantage of specialization?

a) command economy

b) division of labour

c) economies of scale

d) international trade

Chapter 1_Black market

Question 3 1 / 1 point

Which of the following best denotes the reason for the existence of substantial black markets?

a) a market-oriented economy

b) a command economy

c) government laws and rules

d) the microeconomy

Chapter 1_type of market

Question 4 1 / 1 point

In the ______________, households receive goods and services and pay firms for them.

a) labor market

b) savings market

c) goods and services market

d) financial capital market

Chapter 1_Specialization

Question 5 1 / 1 point

_____________ - a term referring to the fact that for many goods, as the level of production increases, the average cost of producing each individual unit declines.

a) Specialization

b) Economies of scale

c) Division of labor

d) Skill

Chapter 1 _The circular flow diagram

Question 6 1 / 1 point

In the circular flow diagram model:

a) households receive income from businesses in exchange for providing inputs and use that income to buy goods and services from businesses.

b) businesses receive revenues from households in exchange for providing goods and services and use those revenues to buy inputs from households.

c) households receive revenue for selling goods and services to businesses, and use that revenue to buy inputs from businesses.

d) Both (a) and (b) are correct.

Chapter 2 _positive statements_ppf

Question 7 1 / 1 point

Philosophers draw a distinction between positive statements, which describe the world as it is, and ___________________s, which describe how the world should be.

a) opportunity cost

b) trade-off

c) budget constraint

d) normative statement

Chapter 2_scarcity

Question 8 1 / 1 point

Scarcity exists because of:

a) specialization and division of labor.

b) the allocation of goods by prices

c) the market mechanism.

d) unlimited wants and limited resources.

Chapter 2 _opportunity costs

Question 9 1 / 1 point

The opportunity cost of an action:

a) is a subjective valuation that can be determined only by the individual who chooses the action.

b) can be determined by adding up the bills incurred as a result of the action.

c) can be objectively determined only by economists.

d) can be determined by considering both the benefits that flow from as well as the monetary costs incurred as a result of the action.

Chapter 2_opportunity cost problems

Question 10 1 / 1 point

"If I didn't have class tonight, I would save the $4 campus parking fee and spend four hours at work where I earn $10 per hour." The opportunity cost of attending class this evening is:

a) $0

b) $40

c) $44

d) $4

Chapter 2 _budget constraint

Question 11 1 / 1 point

The slope of the _________________ is determined by the relative price of the two goods, which is calculated by taking the price of one good and dividing it by the price of the other good.

a) personal preference

b) utility level

c) budget constraint

d) opportunity set

Chapter 2 _ The marginal benefit

Question 12 1 / 1 point

The marginal benefit of a slice of pizza is the:

a) difference between the value of the slice to the consumer and the price of the slice.

b) price of the slice of pizza

c) total amount that a consumer is willing to pay for a whole pizza, divided by the number of slices

d) maximum amount that a consumer is willing to pay for the slice.

Chapter 2 _utility

Question 13 1 / 1 point

The lesson of __________ is to forget about the money that’s irretrievably gone and instead to focus on the marginal costs and benefits of future options.

a) budget constraints

b) sunk costs

c) marginal analysis

d) marginal utility

Chapter 2 _marginal utility

Question 14 1 / 1 point

The law of ____________________________ explains why people and societies rarely make all-or-nothing choices.

a) utility

b) diminishing marginal utility

c) marginal analysis

d) consumption

Chapter 2 _opportunity cost _sunk costs

Question 15 1 / 1 point

In many cases, it is reasonable to refer to the ________________ as the price.

a) budget constraint

b) sunk cost

c) budget constraint

d) opportunity cost

Chapter 2 _opportunity costs_budget constrains

Question 16 1 / 1 point

In deciding how many hours to work, Beulah will make a choice that maximizes her _______; that is, she will choose according to her preferences for leisure time and income.

a) utility

b) budget constraint

c) opportunity set

d) production possibilities frontier

Chapter 2 _law of diminishing marginal utility

Question 17 1 / 1 point

The choice on a production possibilities set that is socially preferred, or the choice on an individual’s budget constraint that is personally preferred, will display _____________________.

a) allocative efficiency

b) scarcity

c) the production possibilities frontier

d) trade-offs

Chapter 2 problems

Question 18 1 / 1 point

The slope of the _________________ is determined by the relative price of the two goods, which is calculated by taking the price of one good and dividing it by the price of the other good.

a) Opportunity cost

b) production possibilities frontier

c) productive efficiency

d) budget constraint

homework 2

hapter 3 Random

Question 1 0 / 1 point

According to the law of supply:

a) there is a direct relationship between price and quantity demanded.

b) there is a direct relationship between price and the quantity supplied.

c) there is an inverse relationship between price and the quantity supplied.

d) there is an inverse relationship between price and quantity demanded.

Question 2 1 / 1 point

The nature of demand indicates that as the price of a good increases:

a) suppliers wish to sell less of it.

b) buyers desire to purchase less of it.

c) more of it is desired.

d) more of it is produced.

Question 3 1 / 1 point

______________ are enacted when discontented sellers, feeling that prices are too low, appeal to legislators to keep prices from falling.

a) Subsidies

b) Rent controls

c) Price floors

d) Price ceilings

Question 4 1 / 1 point

Economists refer to the relationship that a higher price leads to a lower quantity demanded as the _____________.

a) law of demand

b) price model

c) income gap

d) market equilibrium

Question 5 1 / 1 point

The ____________ is the quantity where quantity demanded and quantity supplied are equal at a certain price.

a) supply schedule

b) demand schedule

c) quantity demanded

d) equilibrium quantity

Question 6 1 / 1 point

Any given demand or supply curve is based on the ceteris paribus assumption that ___________________.

a) what is true for the individual is not necessarily true for the whole.

b) all else is held equal

c) everything is variable.

d) no one knows which variables will change and which will remain constant.

Question 7 1 / 1 point

_________________ refers to the total number of units that are purchased at that price.

a) quantity demanded

b) quantity

c) market quantity

d) supply

Question 8 1 / 1 point

The downward slope of the demand curve again illustrates the pattern that as _____________ rises, _________________ decreases.

a) price, quantity demanded

b) quantity supplied, quantity demanded

c) price, quantity supplied

d) quantity demanded, price

Question 9 1 / 1 point

In economics, the demand for a good refers to the amount of the good that people:

a) will buy at various prices.

b) would like to have if the good were free.

c) need to achieve a minimum standard of living.

d) will buy at alternative income levels.

Chapter 3 MC Random

Question 10 1 / 1 point

A 10 percent increase in the price of soda leads to a 20 percent increase in the quantity of iced tea demanded. It appears that:

a) cross-price elasticity of demand for iced tea is 2.

b) elasticity of demand for iced tea is 2 and is elastic.

c) cross-price elasticity of demand for soda is -0.5.

d) elasticity of demand for soda 0.5 and is inelastic.

Question 11 0 / 1 point

__________ is the change in what is on the horizontal axis (quantity) divided by the change in what is on the vertical axis (price).

a) Demand

b) Elasticity

c) Supply

d) Revenue

Question 12 1 / 1 point

The longer the time period considered, the more the elasticity of supply tends to:

a) increase

b) converge to zero

c) remain constant

d) decrease

Chapter 3 Problems

Question 13 0 / 1 point

Refer to Figure 4-2. A change from Point A to Point B represents a(n):

a) increase in demand.

b) increase in quantity demanded.

c) decrease in quantity demanded.

d) decrease in demand.

Chapter 5 elastisity definition

Question 14 0 / 1 point

Demand is said to be _____________ when the quantity demanded is not very responsive to changes in price.

a) inelastic

b) unit elastic

c) independent

d) elastic

Question 15 1 / 1 point

The price elasticity of demand measures the:

a) responsiveness of quantity demanded to a change in price.

b) responsiveness of price to a change in quantity demanded.

c) responsiveness of quantity demanded to a change in quantity supplied.

d) responsiveness of quantity demanded to a change in income.

Question 16 1 / 1 point

Demand is said to be __________ when the quantity demanded changes at the same proportion as the price.

a) unit elastic

b) independent

c) inelastic

d) elastic

Chapter 5 Graph

Question 17 0 / 1 point

Refer to Figure 7-1. With reference to Graph A, at a price of $10, total revenue equals:

a) $1,000.

b) $200.

c) $500.

d) $400.

Chapter 5 Elasticity dem_sup

Question 18 1 / 1 point

Supply is said to be ____________ when the quantity supplied is very responsive to changes in price.

a) inelastic

b) elastic

c) unit elastic

d) independent

Chapter 5 Problems

Question 19 0 / 1 point

A 10 percent decrease in the price of potato chips leads to a 30 percent increase in the quantity of soda demanded. It appears that:

a) elasticity of demand for potato chips is 3.

b) cross-price elasticity of demand for soda is -3.

c) elasticity of demand for soda 3.

d) elasticity of demand for potato chips is 3.

Question 20 1 / 1 point

A 25 percent decrease in the price of breakfast cereal leads to a 20 percent increase in the quantity of cereal demanded. As a result:

a) total revenue will remain constant.

b) total revenue will decrease.

c) the elasticity of demand will increase.

d) total revenue will increase.

Chapter 5 economists are sketching examples of demand and supply

Question 21 1 / 1 point

A demand or supply curve with ______________ would be horizontal in appearance.

a) infinite elasticity

b) zero elasticity

c) infinite cost elasticity

d) unitary elasticity

Question 22 1 / 1 point

When economists are sketching examples of a demand or supply curve that is close to horizontal, they refer to that demand or supply curve as ____________.

a) elastic

b) inelastic

c) price inelasticity

d) having zero elasticity

Question 23 1 / 1 point

The evidence on the supply curve of financial capital is controversial, but at least in the short run, the elasticity of savings with respect to the interest rate appears to be __________.

a) inelastic

b) negative

c) elastic

d) perfectly elastic

Question 24 0 / 1 point

Youth smoking seems to be more __________ than adult smoking—that is, the quantity of youth smoking will fall by a greater percentage than the quantity of adult smoking in response to a given percentage increase in price.

a) elastic

b) inelastic

c) unitary elastic

d) cross-price elastic

Question 25 0 / 1 point

When economists are sketching examples of demand and supply, it is common to sketch a demand or supply curve that is close to vertical, and then to refer to that curve as _________.

a) inelastic

b) elastic

c) income elasticity

d) unitary elasticity

homework 3

Submission View

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Chapter 6 utility definition

Question 1 1 / 1 point

Economists are able to determine total utility by:

a) multiplying the marginal utility of the first unit consumed by the number of units consumed.

b) summing up the marginal utilities of each unit consumed.

c) multiplying the marginal utility of the last unit consumed by the unit price.

d) multiplying the marginal utility of the last unit consumed by the number of units consumed.

Question 2 1 / 1 point

The term _____________ describes a situation where a ________________ causes a reduction in the buying power of income, even though actual income has not changed.

a) substitution effect; lower price

b) income effect; higher price

c) intertemporal budget; lower price

d) intertemporal budget; higher price

Chapter 6 American households

Question 3 1 / 1 point

Approximately what portion of annual consumption is typically spent by American households on shelter?

a) one-third

b) one-fourth

c) one-half

d) one-quarter

Chapter 6 maximizing utility

Question 4 1 / 1 point

As a general rule, utility-maximizing choices between consumption goods occur where the:

a) rise in income has created the greatest utility.

b) price ratio and marginal utilities ratio of two goods is equal.

c) constraints on budget expenditures has fallen substantially.

d) higher-income households have the greatest satisfaction.

Question 5 1 / 1 point

Which of the following is considered to be a tell-tale signal that the point with the highest total utility has been found?

a) the marginal utility per dollar is controlled by trade-offs

b) the quantities demanded change so total utility rises

c) the demand curves are flatter reducing quantity

d) the marginal utility per dollar is the same for both goods

Question 6 1 / 1 point

The most common pattern for marginal utility is ____________________.

a) a long-term perspective theoretical model

b) a budget constraint model

c) diminishing marginal utility

d) substitute consumption

Chapter 6 utility-maximizing point

Question 7 1 / 1 point

Kim has $24 per week in her entertainment budget. She splits her time between going to the movies and yoga classes. Each movie costs $8 while each yoga class costs $3. The total utility from each of these activities is set out in the table below. What is Kim's total utility maximizing point?

Movies Total Utility Yoga Classes Total Utility

0 0 0 0

1 40 1 30

2 75 2 55

3 105 3 76

4 130 4 92

5 160 5 106

6 114

7 116

8 117

a) 1 movie, 5 yoga classes

b) 2 movies, 2 yoga classes

c) 0 movies, 8 yoga classes

d) 3 movies, 0 yoga classes

Chapter 6 Utility_consumer choice

Question 8 1 / 1 point

Saving money is a(n) ____________________, because it involves less consumption in the present, but the ability to consume more in the future.

a) risk premium

b) budget constraint

c) intertemporal choice

d) opportunity cost

Question 9 1 / 1 point

Even with wage increases, the supply curve of labor is most often inelastic for which of the following?

a) part-time workers

b) lawyers

c) full-time workers

d) massage therapists

Question 10 1 / 1 point

The _________________ budget constraint shows the tradeoff between present and future consumption.

a) inflation

b) time-value of money

c) utility-maximizing

d) intertemporal choice

Chapter 6 utility maximizing choice (table)

Question 11 1 / 1 point

Troy has a part-time job in a book store to help pay for his college. He can work up to 30 hours each week at his job, which pays $9 per hour. The table below shows his utility from different levels of leisure and income. Troy currently works 20 hours per week. If he decides to work 30 hours instead, his marginal utility gain from the additional income is ____.

Hours of Leisure Total Utility from Leisure Income Total Utility from Income

0 0 0 0

5 18 45 30

10 34 90 54

15 48 135 72

20 56 180 81

25 60 225 87

30 62 270 90

315 92

a) 6

b) 12

c) 3

d) 9

Chapter 7 industry_structure

Question 12 1 / 1 point

________________________ arises where many firms are competing in a market to sell similar but differentiated products.

a) Monopolistic competition

b) Oligopolistic competition

c) Monogopolised competition

d) Perfect competition

Chapter 7 cost

Question 13 1 / 1 point

A firm's ___________ consist of expenditures that must be made before production starts that typically, over the short run, _______________ regardless of the level of production.

a) variable costs; are constantly changing,

b) variable costs; do not change,

c) fixed costs; are consistently changing,

d) fixed costs; do not change,

Chapter 7 Diminishing variable returns

Question 14 1 / 1 point

In order to determine the average variable cost, the firm's variable costs are divided by _______________________.

a) the quantity of output

b) its' average costs

c) diminishing marginal costs

d) its' fixed costs

Question 15 1 / 1 point

In order to determine ____________, the firm's total costs must be divided by the quantity of its output.

a) fixed costs

b) diminishing marginal returns

c) variable cost

d) average cost

Chapter 7 economies of scale

Question 16 1 / 1 point

The term __________________ describes a situation where the quantity of output rises, but the average cost of production falls.

a) diseconomies of scale

b) economies of scale

c) diminishing marginal returns

d) marginal cost output

Question 17 0 / 1 point

In microeconomics, the term _____________________ is synonymous with economies of scale.

a) increasing returns to scale

b) constant returns to scale

c) diminishing marginal returns

d) decreasing returns to scale

Chapter 7 total revenue

Question 18 1 / 1 point

_____________ is calculated by taking the quantity of everything that is sold and multiplying it by the sale price.

a) Average profit margin

b) Total profits

c) Total cost

d) Total revenue

Chapter 7 Problems with tables

Question 19 1 / 1 point

The table below sets out cost information for the production of volley balls. Some values are missing. Which of the following statements is correct?

Quantity Variable Cost Fixed Cost Total Cost Average Variable Cost ($ per unit) Marginal Cost ($ per unit)

0 0 30 30 0 -

1 12 B 12 E

2 25 C D F

3 A 72 14 G

a) A = 42; E = 40

b) A = 70; E = 12

c) A = 70; E = 40

d) A = 42, E = 12

Question 20 1 / 1 point

Refer to the table below.

Quantity Cost

(in dollars) Fixed Costs

(in dollars) Total Costs

(in dollars) Average Total Costs

(in dollars per unit) Average Variable Costs (in dollars per unit) Marginal Costs

(in dollars per unit)

0 0 40 40 - - - - - -

1 1 40 55 15 55 15

2 35 40 75 17.5 37.5 20

3 60 40 100 20 33.3 25

4 90 40 130 22.5 32.5 30

5 125 40 155 25 31 35

6 160 40 200 26.6 33.3 40

If this information were used to create a total cost graph, the curve should

a) begin at 40 on the vertical axis and slope upward.

b) become steeper as quantity increases.

c) become steeper due to diminishing returns.

d) reflect all of the above.

Chapter 7 costs of production

Question 21 1 / 1 point

The _____________________ curve will always lie below the curve for average cost because average cost includes _____________ in the numerator of the calculation.

a) average variable cost; total costs

b) marginal cost; total costs

c) marginal cost; fixed costs

d) average variable cost; fixed costs

Question 22 0 / 1 point

_____________________ help to explain why every economy, as it develops, has an increasing proportion of its population living in urban areas.

a) Constant returns to scale

b) Economies of scale

c) Diseconomies of scale

d) Agglomeration factors

Question 23 0 / 1 point

A situation where the level of output, scale and average costs are all rising is called

a) decreasing returns to scale

b) diseconomies of scale

c) diminishing returns to scale

d) both a and b are correct

Question 24 1 / 1 point

If a comparison between average cost and price reveals whether a firm is earning profits, then a comparison between average variable cost and price reveals

a) that if the market price is below average cost, then profits will be negative.

b) total revenues are the quantity produced multiplied by the price.

c) whether the firm is earning profit if fixed costs are left out of the calculation.

d) that if the market price exceeds average cost, profits will be positive.

Chapter 7 questions with graph

Question 25 0 / 1 point

The graph above illustrates the electricity market. Consider market competition between firms where price is based on AR and select the most appropriate answer.

a) this market is perfectly competitive with negative profits possible in the long-run

b) this market is imperfectly competitive with excess profits possible in the short-run

c) this market is imperfectly competitive with excess profits possible in the long-run

d) this market is perfectly competitive with excess profits possible in the short-run

homework 4

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Chapter 8 definitions

Question 1 1 / 1 point

The term _________________ refers to a firm operating in a perfectly competitive market that must take the prevailing market price for its product.

a) trend setter

b) business entity

c) price setter

d) price taker

Question 2 1 / 1 point

Economic profit can be derived from calculating total revenues minus all of the firm’s costs,

a) including its marginal revenue.

b) including its opportunity costs.

c) excluding its marginal revenue.

d) excluding its opportunity costs.

Question 3 0 / 1 point

An _________________ is calculated by subtracting the firm's costs from its total revenues, _______________________________ .

a) accounting profit; including opportunity cost

b) economic profit; excluding opportunity cost

c) accounting profit; excluding opportunity cost

d) opportunity cost; including economic profit

Question 4 1 / 1 point

A perfectly competitive industry is a

a) realistic extreme.

b) hypothetical extreme.

c) realistic assumption.

d) hypothetical assumption.

Chapter 8 perfect_competition

Question 5 1 / 1 point

Idaho farmers can sell as large a quantity of their potato crop as they wish,

a) if they set their own price in the short run, but in the long run, the market sets the price.

b) if they set their own price in the long run, but in the short run, the market sets the price.

c) provided each is willing to accept the prevailing market price.

d) provided quality is perceptible and determines the market price.

Question 6 1 / 1 point

Firms operating in a market situation that creates ___________________, sell their product in a market with other firms who produce identical or extremely similar products.

a) perfect competition

b) a perfect monopoly

c) an oligopoly

d) a free-market

Chapter 8 total revenue and total cost

Question 7 1 / 1 point

If marginal cost is rising in a competitive firm's short-run production process and its average variable cost is falling as output is increased, then

a) marginal cost is below average variable cost

b) marginal cost is below average fixed cost.

c) average fixed cost is constant.

d) marginal cost is above average variable cost.

Question 8 1 / 1 point

In economic terms, a practical approach to maximizing profits requires an examination of how changes in production affect ________________ and ________________ .

a) total revenue; marginal cost

b) marginal revenue; marginal cost

c) total revenue; total cost

d) marginal revenue; total cost

Question 9 1 / 1 point

What happens in a perfectly competitive industry when economic profit is

greater than zero?

a) existing firms may expand their operations

b) firms may move along their LRAC curves to new outputs

c) there may be pressure on the market price to fall

d) new firms may enter the industry and all of the above

Chapter 8 marginal product

Question 10 0 / 1 point

In a perfectly competitive market setting, which of the following would be a true statement?

a) Wage rates trend toward marginal revenue product levels.

b) Market price automatically sets itself exactly at equilibrium.

c) Market price rarely trends toward the equilibrium value.

d) Wage rates mirror marginal revenue product levels exactly.

Chapter 8 Problems with graphs

Question 11 1 / 1 point

Refer to the diagram above. Which of the following explains the slope of the total revenue curve illustrated in this graph?

a) total revenue shown as a straight line sloping up indicates a perfectly competitive firm

b) the slope of the total revenue curve is determined by the price of the goods produced

c) at higher levels of output, diminishing returns will cause total cost to slope downward steeply

d) the slope of the total revenue curve is explained by both a and b above.

chapter 8 Problems with table

Question 12 0 / 1 point

Given the data provided in the table below, the total revenue (TR) for production at quantity (Q) level 4 equals

Q P TC TR MR MC Profit

0 $5 $9

1 $5 $10

2 $5 $12

3 $5 $15

4 $5 $19

5 $5 $24

6 $5 $30

7 $5 $45

a) $15.00

b) $20.00

c) zero

d) $1.00

Chapter 8 Problems

Question 13 1 / 1 point

Kate's 24-Hour Breakfast Diner menu offers one item, a $5.00 breakfast special. Kate's costs for servers, cooks, electricity, food, etc. average out to $3.95 per meal. Her costs for rent, insurance cleaning supplies and business license average out to $1.25 per meal. Since the market is highly competitive, Kate should

a) raise her prices above the perfectly competitive level set by the market.

b) lay-off her staff, break her lease, and close the business down immediately.

c) keep the business open in the short-run, but plan to go out of business in the long-run.

d) keep the business open in the short-run, and plan to expand the business in the long-run.

Chapter 9 definitions

Question 14 1 / 1 point

Government ______________ regulations specify that inventors will maintain exclusive legal rights to their respective inventions for ______________ .

a) trade secret; an unlimited time

b) trademark; an unlimited time

c) patent; a limited time

d) copyright; a limited time

Question 15 1 / 1 point

Which of the following is most unlikely to present a barrier to entry into a market?

a) market forces

b) deregulation

c) patent laws

d) technological advantages

Question 16 1 / 1 point

Which of the following will present the least amount of concern to a firm that has a monopoly over a particular industry?

a) whether consumers will purchase its product

b) the competitive actions of other business firms

c) whether consumers will spend on different products

d) barriers to entry and competitors’ patent protection

Question 17 1 / 1 point

The US government has registered ___________________ on behalf of business firms to protect a particularly distinct element each has selected for its ability to aid consumers to easily __________________ .

a) 800,000 trademarks; identify the source of goods

b) 1 million copyright licenses; identify the authors of creative works

c) 200,00 patents; license for use

d) 200,000 trade secrets; create a natural monopoly

Question 18 1 / 1 point

Deregulation occurs when a government eliminates or scales back rules relating to all but one of the following. Which one is it?

a) quantities that can be produced

b) natural monopoly

c) prices that can be charged

d) conditions of entry in a certain industry

Chapter 9 monopoly industry

Question 19 0 / 1 point

A natural monopoly occurs when the quantity demanded is ________ the minimum quantity it takes to be at the bottom of the long-run average cost curve.

a) greater than

b) less than

c) equal to

d) a or c above

Chapter 9 patents

Question 20 0 / 1 point

Copyright protection legislation provides protection for original works

a) during the author's life plus 20 years

b) until the author is 75 years of age

c) during the author's life plus 70 years

d) until the author is 70 years of age

Question 21 1 / 1 point

When J.K. Rowling exerts copyright ownership of her literary works, she creates a monopoly by restricting

a) entry into the market.

b) unit production costs.

c) the number of inventors.

d) demand for the product.

Chapter 9 about the graphs

Question 22 0 / 1 point

A monopolist is able to maximize its profits by

a) setting output at MR = MC and setting price at the demand curve's highest point.

b) producing maximum output where price is equal to its marginal cost.

c) producing output where MR = MC and charging a price along the demand curve.

d) setting the price at the level that will maximize its per-unit profit.

Chapter 9 monopoly curves

Question 23 0 / 1 point

_____________ and __________________ refer to the quantity and price at a point in time.

a) Productive; allocative efficiency

b) Monopoly; productive efficiency

c) Monopoly; allocative efficiency

d) Profit; maximization

Question 24 0 / 1 point

The total revenue curve for a monopolist will

a) start high, decline, and then rise.

b) start low, decline, and then rise.

c) start high, rise, and then decline.

d) start low, rise, and then decline.

Chapter 9 Problems with table

Question 25 1 / 1 point

Refer to the table below. If the information pertains to the demand curve and the long run average cost curve for an electric company that is a natural monopoly, then what quantity will be produced in this market?

Price Quantity Demanded LRAC

$12 100 $6.00

$10 200 $5.50

$8 300 $5.33

$7 400 $5.50

$6 500 $6.00

a) 100

b) 400

c) 200

d) 300

________________________________________

homework 5

Chapter 10 definitions

Question 1 0 / 1 point

Which of the following would be classified as a differentiated product produced by a monopolistic competitor?

a) Channel No. 5

b) natural gas

c) tap water

d) electricity

Question 2 1 / 1 point

Perfect competition and monopoly stand at _____________ of the spectrum of competition.

a) opposite ends

b) the high end

c) the mid-way point

d) the low end

Question 3 1 / 1 point

_____________ occurs when circumstances have allowed several large firms to have all or most of the sales in an industry.

a) A cartel

b) Collusion

c) A monopoly

d) An oligopoly

Chapter 10 monop_competion_oligopoly curves

Question 4 1 / 1 point

If a perfectly competitive firm raises its price, the quantity demanded of its product _____________.

a) diminishes temporarily in the short run

b) falls below marginal cost

c) falls to zero

d) stays the same

Question 5 1 / 1 point

If a monopoly or a monopolistic competitor raises their prices, the quantity demanded ____________.

a) will decline in the short run

b) will expand

c) will decline

d) stays the same

Question 6 1 / 1 point

The demand curve as perceived by a monopolistic competitor is ______________ .

a) upward-sloping

b) downward-sloping

c) U shaped

d) flat

Chapter 10 costs

Question 7 1 / 1 point

A monopolistically competitive firm may earn abnormally high profits in the

a) short run, but after entry occurs, the long term perceived demand curve shifts to the right.

b) short term, but the process of entry will drive those profits to zero in the long run.

c) long term, but the process of entry will drive those profits to zero in the short run.

d) long run, but after entry occurs, the short term perceived demand curve shifts to the right.

Question 8 1 / 1 point

If the firm is producing at a quantity of output where marginal revenue exceeds marginal cost, then,

a) the firm's perceived demand will shift to the left.

b) each marginal unit adds profit by bringing in less revenue than its cost.

c) the firm is now earning zero for profit.

d) the firm should keep expanding production.

Chapter 10 the social benefits

Question 9 1 / 1 point

In a monopolistically competitive market, the rule for maximizing profit is to set MR = MC, which means

a) price is equal to marginal cost.

b) price is higher than marginal revenue.

c) price is equal to marginal revenue.

d) price is lower than marginal revenue.

Question 10 1 / 1 point

A successful advertising campaign may allow competing monopolists to

a) sell a greater quantity.

b) charge a higher price.

c) increase its profits.

d) do all of the above.

Chapter 10 prisoner's dilemma situation

Question 11 1 / 1 point

If one firm operating in an oligopoly raises its price and other firms do not do so,

a) the sales of the firm that increased its price will decline sharply.

b) the sales of the firm with the higher price will decline slightly.

c) the egos of all the top executives will eventually lead to cooperation at that higher price.

d) the firm with the increased price will have its higher profits sustained through cooperation.

Question 12 1 / 1 point

The single most common form of competition in the U.S. is

a) monopolistic competition among firms with differentiated products.

b) oligopolistic competition in a certain market with similar products.

c) perfect competition because it displays product and allocative efficiencies.

d) perfect competition among firms with differentiated products.

Chapter 10 Problems maximize profits

Question 13 1 / 1 point

Mary competes in a monopolistically competitive market. Suddenly, 5 new firms enter the market, causing her perceived demand curve to shift. The following tables show her original and new demand curves and her cost information.

Assume that Mary can only choose from the quantities of output given in the table. By how much will the quantity that she produces change after the new firms enter the market?

Original Demand Curve

Price Quantity TC

30 0 $130

25 10 $140

20 20 $260

15 30 $450

10 40 $660

New Demand Curve

Price Quantity TC

25 0 $130

20 10 $140

15 20 $260

10 30 $450

5 40 $660

a) increase by 10

b) decrease by 5

c) increase by 5

d) decrease by 10

Chapter 10 Problems_ firm's profits

Question 14 0 / 1 point

A monopolistic competitor has the following information about cost and demand.

Quantity Price ($) Total Revenue ($) Marginal Revenue ($) Total Cost ($) Marginal Cost ($) Average Cost($)

0 25 0 25 30 — —

2 24 48 23 35 2.5 17.5

4 23 92 21 45 5 11.25

6 22 132 19 60 7.5 10

8 21 168 17 77 8.5 9.63

10 20 200 15 100 11.5 10

12 19 228 13 126 13 10.5

14 18 252 11 165 19.5 11.79

16 17 272 9 210 22.5 13.13

18 16 288 7 260 25 14.44

20 15 300 5 320 30 16

What will the firm’s profits equal in the short run?

a) $0

b) $91

c) $228

d) $102

Chapter 11_monopoly_antitrust_policy

Question 15 0 / 1 point

______________ give government the power to block certain mergers, and in some cases, to break up large firms into smaller ones.

a) Antitrust laws

b) Nationalization policies

c) Restrictive practices

d) Market regulations

Question 16 0 / 1 point

_____________ has occurred if a government-owned firm becomes privately owned.

a) Regulatory capture

b) Privatization

c) Nationalization

d) Deregulation

Question 17 1 / 1 point

The four-firm ___________________ measures the percentage share of the total sales in the industry that is accounted for by the largest four firms.

a) production ratio

b) market share ratio

c) concentration ratio

d) coordination ratio

Chapter 11 antitrust law

Question 18 1 / 1 point

Antitrust regulations would most likely require one of the following in order to determine whether or not a merger may enhance competition. Which one is it?

a) obvious objective judgments.

b) highly complex analytical tools.

c) analysis using numerical tools.

d) readily qualified judgments.

Question 19 1 / 1 point

In the U.S., about __________ of all reported merger and acquisition transactions in 2012 exceeded $500 million, while about _________ exceeded $1 billion.

a) 99%; 1%

b) 80%; 20%

c) 60%; 40%

d) 25%; 11%

Question 20 1 / 1 point

The main challenge for antitrust regulators is

a) to figure out how to best benefit consumers.

b) to promote the concept of a market-oriented economy.

c) to determine when a merger may hinder competition.

d) to facilitate privatization of government assets.

Chapter 11 regulation

Question 21 1 / 1 point

Which of the following poses a difficult challenge for U.S. competition policy?

a) monopolistic competition

b) natural monopoly

c) perfect competition

d) monopoly

Question 22 0 / 1 point

There have been two especially important shifts in how markets are defined in recent decades: one involves _________________ and the other involves _____________.

a) technology; globalization

b) globalization; communication technologies

c) the Internet; technology

d) communication technologies; the Internet

Question 23 1 / 1 point

Prior to the onset of deregulation in the US during the 1970s, it was common for measurements of concentration ratios and HHIs

a) to exceed 1,000

b) to extend past national borders.

c) to stop at national borders.

d) to exceed 10,000

Chapter 11 Problems four-firm concentration ratio

Question 24 1 / 1 point

The information below sets out the estimated market shares for the cellular phone manufacturing market.

Firm Market Share

Nokia 36%

Fujitsu 3%

Kyocera 3%

LG 6%

Motorola 16%

Samsung 6%

Sanyo 4%

Siemens 7%

Sony Ericsson 11%

Plus 8 more firms with 1% each

Based on this information, the Herfindahl-Hirschman Index is

a) 1,836

b) 1,272

c) 2,216

d) 1,800

Chapter 11 Problems _monopoly_antitrust law

Question 25 0 / 1 point

City Gas is a natural monopoly that supplies natural gas to a particular city. Its cost and demand information are given below.

Quantity

(Millions of therms) Price

($ per therm) Total Cost

(million $)

1 48 35

2 44 64

3 38 90

4 30 113

5 20 133

6 8 150

An unregulated monopoly will produce ____ million therms of natural gas and sell each therm for ____.

a) 44; $2

b) 38; $3

c) 2; $44

d) 3; $38

homework 6

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Chapter 12 _env_protection

Question 1 0 / 1 point

In addition to the current levels of air and water pollution, a list of important environmental issues would most likely include:

a)

emissions of greenhouse gases

b)

safe disposal of hazardous waste materials

c)

destruction of wetlands and other habitats

Correct Answer

d)

extinction of species and all of the above

Question 2 0 / 1 point

Command-and-control regulation is a body of law that

a)

fails to consider private costs of firms.

Incorrect Response

b)

specifies allowable quantities of pollution.

c)

details which pollution-control technologies must be used.

Correct Answer

d)

can include both b and c.

Question 3 1 / 1 point

Since 1969, when the Cuyahoga River in Ohio was so polluted that it spontaneously burst into flame, the overall quality of water in the U.S. has

a)

steadily declined.

b)

remained unchanged.

c)

remained a non-issue.

Correct Response

d)

steadily improved.

Question 4 0 / 1 point

A pollution charge is a form of tax imposed on

a)

low-income market-orientated industries.

Incorrect Response

b)

pollution control technologies.

Correct Answer

c)

the quantity of pollution that a firm emits.

d)

every economy in the world.

Chapter 12 _env_protection_negative_externalities

Question 5 0 / 1 point

The arguments presented by economists regarding U.S. environmental command-and-control regulations generally

a)

accept the goal of reducing pollution.

b)

question the regulations as being the best policy tools for meeting reduction goals.

c)

assert that these laws are clear of the usual fine print, loopholes and exceptions.

Correct Answer

d)

lack flexibility and a and b above.

Question 6 0 / 1 point

To be effective, U.S. command-and-control environmental regulation required

a)

social costs of industrial pollution to become unavoidable business costs.

b)

firms to take the social costs of pollution into account.

c)

firms to increase their costs by installing specified anti-pollution equipment.

Correct Answer

d)

the EPA to oversee all environmental laws and all of the above.

Question 7 0 / 1 point

Market-oriented environmental tools _______________ for firms to take the social costs of pollution into account and ____________________ in reacting to these incentives.

Correct Answer

a)

create incentives; allow firms some flexibility

b)

draw distinctions; lower the social costs incurred

c)

lack incentives; prohibit firms from having flexibility

d)

specify particular technology; lower the social costs incurred

Chapter 12 marketable permits

Question 8 0 / 1 point

Marketable permits can be viewed as a form of improved _______________.

a)

command-and-control regulations

Correct Answer

b)

property rights

c)

flat fee pollution tax

d)

refundable tax credits

Question 9 0 / 1 point

In circumstances involving millions of emitters of small amounts of pollution who have no strong interest in trading, _________________ will typically offer a better choice for achieving desired reductions of environmental pollution levels.

a)

enhanced property rights

b)

marketable permits

c)

ecotourism

Correct Answer

d)

pollution charges

Question 10 0 / 1 point

A beekeeper decides to locate her business on a plot of land that is between an apple orchard and an elementary school. A positive externality that can result is

Correct Answer

a)

the bees helping to pollinate the orchard, leading to more fruit.

b)

the possibility of the bees stinging the students at the school.

c)

the cost of the bee hives to the beekeeper.

d)

the honey the bees produce.

Question 11 0 / 1 point

Rather than arguing over whether the ultimate goal is zero pollution or a reasonable level of pollution, the immediate focus should be to tackle the environmental issues where the _____________________ and the __________________ .

a)

environmental benefits are greatest; social costs are least

Correct Answer

b)

marginal benefits are greatest; marginal costs are least

c)

social costs are greatest; environmental benefits are least

d)

marginal benefits are least; marginal costs are greatest

Question 12 0 / 1 point

The challenge of preserving biodiversity,

a)

any nation itself can reduce emissions to solve global warming.

b)

any nation acting alone can protect biodiversity around the world.

c)

includes the full spectrum of animal and plant genetic material.

Correct Answer

d)

a nation can protect biodiversity within its own borders and c.

Chapter 12 problems

Question 13 0 / 1 point

The supply and demand conditions facing a firm that makes widgets and generates a negative externality by dumping a highly toxic sludge in a nearby river is given in the table below.

Price

Quantity Demanded

Quantity Supplied without Paying Social Costs

Quantity Supplied after Paying Social Costs

100

0

120

75

80

10

100

50

55

30

90

30

40

55

85

25

30

80

80

20

20

100

65

15

The equilibrium price and quantity when social costs are taken into account are

a)

Price = $40, Quantity = 55

Correct Answer

b)

Price = $55, Quantity = 30

c)

Price = $30, Quantity = 20

d)

Price = $30, Quantity = 80

Chapter 13 random selection

Question 14 0 / 1 point

Generally, market competition and technology can

a)

support each other.

b)

oppose each other.

c)

compliment each other.

Correct Answer

d)

sometimes a or b.

Question 15 0 / 1 point

When it is costly or impossible to exclude someone who hasn't paid to use a particular good from using it, then that good is classified as being

a)

public good

b)

free rider

c)

unexcludable

Correct Answer

d)

nonexcludable

Question 16 0 / 1 point

If large numbers of individuals choose to behave as free riders,

a)

more of the public good will be available for paying riders.

Correct Answer

b)

the public good may never be provided.

c)

public domain technologies become more difficult to obtain.

d)

public goods will quickly be privatized.

Question 17 0 / 1 point

If I’MSmartCo’s research and development project succeeds, then

a)

they will need to find a less expensive way to add even more desirable characteristics.

b)

market competition will ultimately discourage commercialization of the new technology.

Correct Answer

c)

competitors may find a way to adapt and copy the underlying idea without incurring R&D costs.

d)

their success will be temporary because they will inevitably fall behind other innovative competitors.

Question 18 0 / 1 point

In order for a good to be classified as ______________ , when one person uses the good, others are also able to use it.

a)

nonexcludable

Correct Answer

b)

nonrivalrous

c)

unexcludable

d)

unrivalrous

Chapter 13 invests in new technology

Question 19 0 / 1 point

Some studies done by economists have found that the original inventor receives _________________________________________________ from innovations, while other businesses and new product users receive the rest of the benefit.

Correct Answer

a)

one-third to one-half of the total economic benefits

b)

one-quarter to one-half of the social and economic benefits

c)

one-quarter to one-third of the total economic benefits

d)

one-quarter to one-third of social and economic benefits

Question 20 0 / 1 point

One reason some economists doubt that patent protection encourages innovation is that economic studies show that inventors receive only __________________ of the total economic value of their inventions in countries that ______________ .

Correct Answer

a)

one-third to one-half; already had patents

b)

one-half to two-thirds; had existing patents

c)

one-third to one-half; previously had no patents

d)

one-half to two-thirds; previously had few patents

Question 21 0 / 1 point

When technology is advancing so quickly, even a patent from, say, two years ago may be ___________________, because __________________________ .

a)

irrelevant; inventors are only receiving a slice of the social value.

b)

somewhat outdated; few firms are relying on the technology

Correct Answer

c)

completely outdated; no firm is relying on that technology any longer

d)

irrelevant; not every idea can remain under patent protection forever.

Question 22 0 / 1 point

In economic terms, when I’mASoftwareCo. invests in new technology innovations,

a)

potential externalities arise.

b)

negative externalities arise.

Correct Answer

c)

positive externalities arise.

d)

competitive externalities arise.

Chapter 13 copyright

Question 23 0 / 1 point

Which of the following legislation was enacted in 1998 to allow copyright to be extended from 50 to 70 years after an author's death?

a)

Thomas Edison Copyright Term Extension Act

b)

Thomas Edison Patent Restoration Act

c)

Sonny Bono Patent Restoration Act

Correct Answer

d)

Sonny Bono Copyright Term Extension Act

Question 24 0 / 1 point

Which of the following would most likely be recognized as a defining characteristic of a public good?

a)

the good is nonrivalrous item

b)

the good is nonexcludable item

Correct Answer

c)

the good is both a and b above

d)

the good is a separate and identifiable item

Chapter 13 problems

Question 25 0 / 1 point

CleanAir Motors Inc. wants to build electric cars with no emissions. However, electric motors require innovative battery technology for adequate energy storage to meet basic daily commuting needs. The company has several possibilities for alternative battery technology, along with estimates of how these approaches would affect their costs of producing the cars and their sales of the cars. These estimates are set out in the table below. Every investment has an additi