Econ Final

68 Questions  I  By AshyMSU

  
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1.  A rise in the price of coffee is likely to have which of the following initial effects on the market for tea, a subsitute?
A.
B.
C.
D.
2.  Proponents of protectionism commonly base their case on
A.
B.
C.
D.
3.  Given powers granted to the Fed since 2008, and setting aside extreme crisis conditions, which of the following interest rates would normally be expected to be the highest?
A.
B.
C.
D.
4.  Suppose hot dogs to be an inferior good. An increase in consumer incomes, other things being equal, is likely to cause which of the following?
A.
B.
C.
D.
5.  Which of the following woudl be an example of "spontaneous order"?
A.
B.
C.
D.
6.  Which of the following best characterizes the official policy of the Federal Reserve regarding asset bubbles, as implemented during the period before the recession that started at the end of 2007? 
A.
B.
C.
D.
7.  A firm has total capital of $500 million. The opportunity cost of capital is 12 percent per year. The firm earns an accounting profit of $65 million and has no other implicit costs. Its pure economic profit is
A.
B.
C.
D.
8.  Investment, as the term is used in economics, means
A.
B.
C.
D.
9.  The government's primary budget deficit takes into account all expenditures except which of the following?
A.
B.
C.
D.
10.  A perfectly competitive firm sells its output for $50 a unit. At 1,000 units of output, marginal cost is $40 and is increasing, average variable cost is $35, and average total cost is $60. To maximize short-run profit, what should the firm do?
A.
B.
C.
D.
11.  Which of the following methods of pollution control have been tried in the U.S.?
A.
B.
C.
D.
12.  On the whole, it appears that inside and outside lags for fiscal policy are 
A.
B.
C.
D.
13.  Environmental problems and policies provide numerous examples of
A.
B.
C.
D.
14.  Which of the following economists advocated a policy rule based on a steady rate of growth for the money stock?
A.
B.
C.
D.
15.  Assume an increase in the price of beef increases the demand for pork. Restoration of equilibrium in the pork market will require
A.
B.
C.
D.
16.  If a country exports products of land-intensive indutries and imports products of labor-intensive industires, we would expect that the county's 
A.
B.
C.
D.
17.  An early study by Joe Bain concluded that
A.
B.
C.
D.
18.  If the Fed chose to increase the rate it charges banks on loans of resrves, the money supply would:
A.
B.
C.
D.
19.  Which of the following statements is true of MC > ATC?
A.
B.
C.
D.
20.  Suppose the target reserve ratio for the banking system is 10 percent and deposits are the only form of money. If the central bank supplies $1,000 in new reserves though an open market operation, the money stock will increase by how much after bankds use the new reserves as a basis for additional loans?
A.
B.
C.
D.
21.  Using Qs to indicate quantity supplied and Qd to indicate quantity demanded, which of the following circumstances would be likely to produce an upward movement of the price of a good?
A.
B.
C.
D.
22.  Policies to control unemployment are primarily a concern of 
A.
B.
C.
D.
23.  Which of the following passes through a point of the long-run equilibrium?
A.
B.
C.
D.
24.  If the nomminal interest rate is 6 percent and the inflation rate is 8 percent, the real rate of interest is 
A.
B.
C.
D.
25.  Assume that a variable input price, such as labor wages, rises. What will be the short-run impact on the market price for firms in a perfectly competitive industry?
A.
B.
C.
D.
26.  When the economy is in a liquidity trap, which of the following is likely to increase fastest?
A.
B.
C.
D.
27.  The law of diminishing returns implies that the marginal physical product curve must 
A.
B.
C.
D.
28.  The command-and control approach to pollution control can best be described by which statement?
A.
B.
C.
D.
29.  In a democracy, which of the following voting groups is most likely to see their desired level of pollution control met?
A.
B.
C.
D.
30.  If the U.S. were to relax it's immigration restrictions, we might expect
A.
B.
C.
D.
31.  In the United States the interbank loan market where banks borrow reserves from one another is called
A.
B.
C.
D.
32.  Other things being equal, which of the following would tend to cause the British pound to appreciate?
A.
B.
C.
D.
33.  When the Fed makes an open market sale of secutiries, the nation's money supply will
A.
B.
C.
D.
34.  If a country exports fish and imports wheat, an interruption of trade will be likely to decrease
A.
B.
C.
D.
35.  Which of the following markets can contain a number of firms producing differentiated products?
A.
B.
C.
D.
36.  Which of the following types of unemployment can be less than 0 at the peak of the business cycle?
A.
B.
C.
D.
37.  An unexpected increase in the rate of inflation will tend to
A.
B.
C.
D.
38.  If the price of leather increases, other things being equal, which of the following would be the most likely initial effect?
A.
B.
C.
D.
39.  The minimum efficient scale for a firm is the level of output at which 
A.
B.
C.
D.
40.  A Taylor rule favors use of which of the following intermediate targets byt he central bank?
A.
B.
C.
D.
41.  Which of the following is likely to make tacit coordination easier in an oligopolistic market?
A.
B.
C.
D.
42.  The Clean Air Act, after amendments in the 1990's, uses which of the following to control acid rain?
A.
B.
C.
D.
43.  Budget items like social security and Medicare that are not subject to annual appropriations are known as
A.
B.
C.
D.
44.  If the nominal rate of interest is 3 percent and the rate of inflation is -5 percent (5 percent rate of deflation), the real interest rate is
A.
B.
C.
D.
45.  Suppose that during a recession, a country has an output gap of $100 billion. In order to close the output gap using fiscal policy, it must increase government purchases
A.
B.
C.
D.
46.  A country that has a government budget deficit and domestic investment that exceeds domestic saving will also have
A.
B.
C.
D.
47.  Economic forecasts tend to be most accurate in which of the following cases?
A.
B.
C.
D.
48.  Which of the following is most frequently used monetary tool used by the Fed?
A.
B.
C.
D.
49.  The market for hair styling services in a medium- to large-sized community would best be described as which of the following?
A.
B.
C.
D.
50.  An industry with an eight-firm concentration ratio of 95 percent and a formal agreement on prices and output among the top eight firms would best be described as
A.
B.
C.
D.
51.  Which of the following disciplines relies on theories to explain how facts are related?
A.
B.
C.
D.
52.  At the market equilibrium in a perfectly competitive market, consumer surplus is
A.
B.
C.
D.
53.  Which of the following best describes a fixed exchange rate target?
A.
B.
C.
D.
54.  From 1950 to 2007, the U.S. economy 
A.
B.
C.
D.
55.  To attract the attention of potential customers, U.S. bank spends $500 to hire a band to play at the opening of a branch at the new Walmart shopping center. With regard to the ongoing operations of the new branch, the cost of hiring the band is considered to be
A.
B.
C.
D.
56.  Which of the following is not characteristic of perfect competition?
A.
B.
C.
D.
57.  Which of the following will cause a shift in the long-run aggregate supply curve?
A.
B.
C.
58.  Which of the following could be considered a significant barrier to entry into a market? 
A.
B.
C.
D.
59.  A point representing 500 roast turkey dinners and 600 steak dinners lies outside the production possibilty frontier of Joe's Restaurant, given the factors of production and technology available to it. This means that
A.
B.
C.
D.
60.  Which of the following produces an effect that is properly represented by a movement along a given aggregate demand curve?
A.
B.
C.
D.
61.  A bank is subject to a 20 percent required-reserve ratio. When this bank receives a deposit of  $1,000, its 
A.
B.
C.
D.
62.  Which of the following is not a component of domestic product?
A.
B.
C.
D.
63.  If the short-run  aggregate supply curve intersects the aggregate demand curve at a point to the right of the natural level of real output, then, over time, the expected level of input prices will tend to
A.
B.
C.
D.
64.  If the equilibrium price of natural gas is $2.50 per thousand cubic feet and a price ceiling is imposed of $3 per thousand cubic feet, the likely result will be
A.
B.
C.
D.
65.  The study of the factors determining the price of gasoline relative to the price of other fuels would be primarily a concern of
A.
B.
C.
D.
66.  The long-run average cost curve
A.
B.
C.
D.
67.  Domestic product equals
A.
B.
C.
D.
68.  Market equilibrium
A.
B.
C.
D.
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