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Economics Midterm Study Guide

45 Questions  I  By Xamboozi
Economics Quizzes & Trivia
Midterm Questions

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