Economics Midterm Study Guide

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Economics Quizzes & Trivia
Midterm Questions

  
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1.  Which of the following statements are true?
A.
B.
C.
D.
2.  Which of the following items is included in the calculation of GDP?
A.
B.
C.
D.
3.  If all resources are used efficiently to produce goods and services, a nation will find itself producing
A.
B.
C.
D.
4.  Compared to a perfectly competitive firm, a monopolist:
A.
B.
C.
D.
5.  Oligopolistic industries consist of
A.
B.
C.
D.
6.  If the tea harvest is very good in a particular year, the supply of tea will be
A.
B.
C.
D.
7.  As a result of the decline in the demand for beef in the United States, the demand for cattle ranchers has
A.
B.
C.
D.
8.  A minimum wage:
A.
B.
C.
D.
9.  If the price of peanut butter increases, other things constant, demand for jelly will
A.
B.
C.
D.
10.  Economists emphasize the importance of equilibrium in markets because
A.
B.
C.
D.
11.  The communal nature of a highway means that no one individual is motivated to pay for it because even those who do not pay for it will still benefit from using it. This is an example of:
A.
B.
C.
D.
12.  Marginal cost is the:
A.
B.
C.
D.
13.  Economics
A.
B.
C.
D.
14.  The golden rule of profit maximization states that any firm maximizes profit by producing where
A.
B.
C.
D.
15.  ____ is the situation in which the marginal product of labor is declining as more labor is hired.
A.
B.
C.
D.
16.  If the MPP of an additional unit of labor is 20 units per hour, the product price is $5 per unit, and the wage rate is $60 per hour, then, (Hint: MRP = MPP X p)
A.
B.
C.
D.
17.  Which of the following is not necessarily a characteristic of perfect competition?
A.
B.
C.
D.
18.  The market produces too few public goods because:
A.
B.
C.
D.
19.  Marginal physical product is
A.
B.
C.
D.
20.  If the quantity of concert tickets sold decreases by 10 percent when the price increases by 5 percent, the price elasticity of demand over this range of the demand curve is:
A.
B.
C.
D.
21.  A firm hires labor in a labor market. If the wage rate is $44, the firm should hire
A.
B.
C.
D.
22.  A public good:
A.
B.
C.
D.
23.  Opportunity cost is defined
A.
B.
C.
D.
24.  A model is defined as a:
A.
B.
C.
D.
25.  Which of the following is not true regarding a change in quantity demanded?
A.
B.
C.
D.
26.  All final goods and services that make up GDP can be expressed in the form:
A.
B.
C.
D.
27.  Which of the following is true for monopoly?
A.
B.
C.
D.
28.  In order to demand a good, the buyer must
A.
B.
C.
D.
29.  A monopolist is
A.
B.
C.
D.
30.  Monopolistic competition is identified by
A.
B.
C.
D.
31.  Macroeconomics is best described as the study of
A.
B.
C.
D.
32.  Which of the following is the best example of a microeconomic topic?
A.
B.
C.
D.
33.  If Stimpson University increases tuition in order to increase its revenue, it will:
A.
B.
C.
D.
34.  When the additional satisfaction from a good declines as more of it is consumed, this illustrates the law of
A.
B.
C.
D.
35.  Market failure occurs when:
A.
B.
C.
D.
36.  A perfectly competitive firm is a price taker because:
A.
B.
C.
D.
37.  The optimal mix of output is the:
A.
B.
C.
D.
38.  Gross Domestic Product (GDP) equals the
A.
B.
C.
D.
39. 
  National income account (billions of   dollars)  
  Personal consumption expenditures (C) $500  
  Government expenditures (G) 50  
  Gross private domestic investment (I) 300  
  Exports (X) 50 
  Imports (M) 100
  As shown in the above exhibit, GDP as calculated by the expenditure approach is
A.
B.
C.
D.
40.  A firm is currently operating where the MC of the last unit produced = $64, and the MR of this unit = $70, i.e. MR > MC. What would you advise this firm to do?
A.
B.
C.
D.
41.  The short run is a period of time:
A.
B.
C.
D.
42.  An improvement in a firm's technology that reduces its production costs will result in a (an):
A.
B.
C.
D.
43.  If real GDP increased by 3 percent, then
A.
B.
C.
D.
44.  Suppose the market for hot pretzels in New York City is perfectly competitive. What is true of demand in this market?
A.
B.
C.
D.
45.  A demand curve usually has a
A.
B.
C.
D.
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