Economics Exam, Econ 414 Final Chapter 14, Fin 321 Midterm 2, Macro Final Exam, Econ chapter 14 & 16, ManEcon - Chapter 14 quiz, quiz 4, ECON TEST 3, Managerial Economics Chapter 12 Test Bank
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Economics
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Economics
Economics Exam, Econ 414 Final Chapter 14, Fin 321 Midterm 2, Macro Final Exam, Econ chapter 14 & 16, ManEcon - Chapter 14 quiz, quiz 4, ECON TEST 3, Managerial Economics Chapter 12 Test Bank
Unlike an accountant, an economist measures costs on a (n) ________ basis.
replacement
There is no cha...
Economics Exam, Econ 414 Final Chapter 14, Fin
321 Midterm 2, Macro Final Exam, Econ chapter
14 & 16, ManEcon - Chapter 14 quiz, quiz 4,
ECON TEST 3, Managerial Economics Chapter 12
Test Bank
Unlike an accountant, an economist measures costs on a (n) ________ basis.
replacement
There is no change in total revenue when the demand curve for a good is:
Unitary elastic.
When the price of a good in a market is above equilibrium:
The quantity supplied exceeds the quantity demanded.
A surplus is observed.
The price will fall in the near future.
ALL OF THE ABOVE
When a firm raises the price of its product, what happens to total revenue?
If demand is elastic, total revenue decreases
Which of the following would NOT describe an aspect of long-run adjustment to
rising gasoline prices?
Consumers make no changes in their current driving habits.
Gasoline and sports utility vehicles (SUVs) are complementary goods. One would
expect, therefore, that the recent increase in the price of gasoline would cause
The demand for SUVs to fall and the equilibrium quantity to fall
Which of the following best describes 'Market Value Added'?
The difference between the market value of the firm and the amount of contributed
capital.
If sellers try to charge a price which is above the equilibrium level, then it can be
predicted that:
Surplus conditions will result and forces will be set in motion to cause prices to fall.
Several firms spent millions of dollars advertising their goods and services at the
recent Super Bowl. One of the reasons they did so was that they were attempting
to:
shift the demand for the product to the right.
Which of the following statements is true?
An increase in demand causes equilibrium price and quantity to rise.
A decrease in demand causes equilibrium price and quantity to fall.
An increase in supply causes equilibrium price to fall and quantity to rise.
,A decrease in supply causes equilibrium price to rise and quantity to fall.
ALL OF THE ABOVE
Which of the following statements highlight the distinction between
microeconomics and macroeconomics?
microeconomics concentrates on the behavior of individual consumers and firms while
macroeconomics focuses on the performance of the entire economy.
If the cross price elasticity between a Subway Veggie Delite and Jimmy John's
Veggie sandwich is 4.0, a 10% increase in the price of Subway sandwich will lead
to a:
40% increase in the demand of Jimmy John's sandwiches
Assume Coca-Cola and Pepsi-Cola are substitutes. A rise in the price of Coca-
Cola will have which of the following effects on the market for Pepsi?
A rightward shift in the Pepsi demand curve.
Which of the following examples best illustrates the concept of derived demand?
The higher the demand for automobiles, the greater the demand for steel.
Speed in communications and the growth of internet has caused transaction
costs to:
decrease significantly
Which of the following would represent a microeconomics decision or process?
Using forecasted interest rates to determine the appropriate time to finance a new plant.
Weather conditions have been exceptionally good for growing strawberries this
year and a bumper crop is anticipated. As a result, one would expect
The supply to be higher than normal, and the market price to be lower
Suppose there is a shortage of food in the market. In the long-run,the guiding
(allocation) function of price can be expected to cause
an increasing shift in the supply of food.
If the coefficient of price elasticity for a given product is -2.5, then it can be said
that
Demand will increase if price rises
A lower price will be accompanied by lower total expenditures on the product
A one percent change in the products price will tend to be accompanied by a 2.5
percent change in quantity demanded in the same direction of the price change
Demand is inelastic
NONE OF THESE
Which of the following best describes the difference between a change in
quantity demanded and change in demand?
A change in quantity demanded occurs when the price of the good has changed; a
change in demand occurs when a non-price determinant of demand for the good has
changed.
A firm earns a normal profit when its total revenues just offset both the ________
cost and ________ cost.
,accounting; opportunity
As you move down along a demand curve,
demand becomes less elastic
If the price of a slice of pizza rises from $2.50 to $3, and quantity demanded falls
from 10,000 slices to 7,400 slices, using the formula for arc price elasticity what is
the price elasticity of demand ?
- 1.64
If the demand curve for a good always has unitary price elasticity, what does this
imply about consumer behavior?
Consumers will spend a constant total amount on the good.
A price-ceiling can be defined as:
a legal maximum price established by the government for a specific market.
Which of the following best describes entrepreneurial ability?
The ability to manage scarce resources, find new methods to achieve objectives, and
be willing and able to assume the risk associated with achievement.
Suppose that the Vice President for Marketing of Aetna Pharmacueticals argues
that a 10 percent increase in the price of insulin (used by diabetic patients) will
raise total revenues. It can be inferred that the Vice Prseident of Marketing thinks
that demand for insulin is:
Inelastic.
When we are making choices, we do because of:
unlimited wants and limited resources.
An inferior good has a ________ income elasticity of demand and demand for the
good ________ as income rises.
negative; decreases
Typically, we can expect that the:
Elasticities for individual brands are likely to be higher than for the entire product
category.
Which of the following best describes the conditions necessary for a market to
attain equilibrium?
All of the above accurately describe the conditions necessary for a market to attain
equilibrium.
Suppose President Trump threatens that all imports of Mexican built cars will be
subjected to a border tax (tariff) in the future. As a result of this announcement,
we can expect that the current demand for these cars to:
increase, which is a shift to the right of the demand curve.
If a product has several possible substitutes, we would expect the demand curve
to be
Relatively elastic
Yesterday Seller A supplied 400 units of a good X at $10 per unit. Today Seller A
supplied the same quantity of units at $5 per unit. Based on this evidence, Seller
A has experienced a (an):
Increase in supply.
In order to confirm that Apple and Samsung are indeed competitors, the Federal
Trade Commission should test the ____ and should get a ____.
cross-price elasticity; positive number
, Management can be best described as:
How firms organize and allocate a firms resources to achieve the firm's objectives
Which of the following best describes modern corporations in the U.S.?
Large publicly held firms in which the management of the firm is typically the dominate
proportion of its owners.
Managerial economics can best be described as:
How firm managers use economic analysis to make business decisions and solve
problems to best use the firms resources.
When there are variation in a firm's returns over the business cycle, the firm is
facing _______ risk.
Business
Which of the following best describes the opportunity cost of a year of college?
The dollar value of tuition, books, all associated explicit expenses, the interest that may
have been earned on that sum, and any foregone income from not working over that
period
If when the price of good A rises by 5 percent the quantity demanded of good B
rises by 10 percent, it can be said that
A and B are substitute goods
Which of the following best describes the process of answering the basic
economic question in the United States?
A mixed economy where most goods and services produced are the result of market
forces and government regulation.
Transactions costs of a good or service, being higher than internal provision:
Result in the firm providing the good or service for itself.
Which of the following describes how the allocating function of price determines
long-run equilibrium quantity?
The change in market price provides an incentive for consumers to change their
quantity of consumption and for producers to redistribute their resources.
Producers respond to an increase in demand by allocating a greater amount of
resources to production due to the increased profitability of the product.
Consumers respond to an increase in supply by substituting away from other goods due
to the relative price decrease.
ALL OF THE ABOVE ACCURATELY DESCRIBE THE LONG-RUN PROCESS
Which of the following best describes the "guiding function" of price?
The guiding function of price is the movement of resources into or out of markets in
response to a change in the equilibrium price of a good or service.
An optimal decision in managerial economies in reached when:
MR = MC
Consumers will tend to increase their expenditures on a product
When price increases and demand is price inelastic
Which of the following describes marginal revenue?
The addition to total revenue associated with a one-unit rise in quantity.
When transaction cost are high, a company may decide to:
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