Economics Midterm Study Guide

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Economics Quizzes & Trivia
Midterm Questions

  
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1.  Economics
A.
B.
C.
D.
2.  Macroeconomics is best described as the study of
A.
B.
C.
D.
3.  Which of the following is the best example of a microeconomic topic?
A.
B.
C.
D.
4.  A model is defined as a:
A.
B.
C.
D.
5.  Opportunity cost is defined
A.
B.
C.
D.
6.  If all resources are used efficiently to produce goods and services, a nation will find itself producing
A.
B.
C.
D.
7.  Gross Domestic Product (GDP) equals the
A.
B.
C.
D.
8.  Which of the following items is included in the calculation of GDP?
A.
B.
C.
D.
9.  All final goods and services that make up GDP can be expressed in the form:
A.
B.
C.
D.
10.  If real GDP increased by 3 percent, then
A.
B.
C.
D.
11. 
  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.
12.  In order to demand a good, the buyer must
A.
B.
C.
D.
13.  Which of the following is not true regarding a change in quantity demanded?
A.
B.
C.
D.
14.  A demand curve usually has a
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B.
C.
D.
15.  If the price of peanut butter increases, other things constant, demand for jelly will
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B.
C.
D.
16.  An improvement in a firm's technology that reduces its production costs will result in a (an):
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B.
C.
D.
17.  Economists emphasize the importance of equilibrium in markets because
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B.
C.
D.
18.  If the tea harvest is very good in a particular year, the supply of tea will be
A.
B.
C.
D.
19.  Which of the following statements are true?
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B.
C.
D.
20.  When the additional satisfaction from a good declines as more of it is consumed, this illustrates the law of
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B.
C.
D.
21.  If Stimpson University increases tuition in order to increase its revenue, it will:
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B.
C.
D.
22.  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.
23.  The short run is a period of time:
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B.
C.
D.
24.  Marginal physical product is
A.
B.
C.
D.
25.  ____ is the situation in which the marginal product of labor is declining as more labor is hired.
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B.
C.
D.
26.  Marginal cost is the:
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B.
C.
D.
27.  Which of the following is not necessarily a characteristic of perfect competition?
A.
B.
C.
D.
28.  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.
29.  A perfectly competitive firm is a price taker because:
A.
B.
C.
D.
30.  The golden rule of profit maximization states that any firm maximizes profit by producing where
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B.
C.
D.
31.  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.
32.  A monopolist is
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B.
C.
D.
33.  Which of the following is true for monopoly?
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B.
C.
D.
34.  Compared to a perfectly competitive firm, a monopolist:
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B.
C.
D.
35.  Monopolistic competition is identified by
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C.
D.
36.  Oligopolistic industries consist of
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B.
C.
D.
37.  A firm hires labor in a labor market. If the wage rate is $44, the firm should hire
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B.
C.
D.
38.  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.
39.  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.
40.  A minimum wage:
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B.
C.
D.
41.  The optimal mix of output is the:
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B.
C.
D.
42.  Market failure occurs when:
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C.
D.
43.  A public good:
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B.
C.
D.
44.  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:
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B.
C.
D.
45.  The market produces too few public goods because:
A.
B.
C.
D.
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