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Economics Midterm Study Guide

45 Questions  I  By Xamboozi
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Midterm questions

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