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Question;1. (TCO 1) As a consequence of the problem of scarcity;(Points: 4);there is never enough of anything.;individuals have to make choices from among alternatives.;production has to be planned by government.;things which are plentiful have relatively high prices.;Question 2. 2. (TCO1) Money is not considered to be an;economic resource because (Points: 4);as such, it is not productive.;money is not a free gift of nature.;money is made by man.;idle money balances do not earn interest income.;Question 3. 3. (TCO1) A point inside the production;possibilities curve is (Points: 4);attainable and the economy is efficient.;attainable, but the economy is inefficient.;unattainable, but the economy is inefficient.;unattainable and the economy is efficient.;Question 4. 4. (TCO1) In a command system (Points: 4);self-interest guides and commands individuals to pursue;actions that lead them toward achieving their goals.;the head of each family decides what to do with the family's;resources.;the government makes production and allocation decisions.;market traders command what outputs are produced and how;they are allocated.;Question 5. 5. (TCO 2) Which is consistent with the law of;demand? (Points: 4);A decrease in the price of tacos causes no change in the;quantity of tacos demanded.;An increase in the price of pizza causes an increase in the;quantity of pizza demanded.;An increase in the price of hamburgers causes a decrease in;the quantity of hamburgers demanded.;A decrease in the price of turkey sandwiches causes a;decrease in the quantity of turkey sandwiches demanded.;Question 6. 6. (TCO 2) What combination of changes in supply;and demand would most likely increase the equilibrium quantity? (Points: 4);When supply increases and demand increases;When supply decreases and demand decreases;When supply decreases and demand increases;When supply increases and demand decreases;Question 7. 7. (TCO 2) Chuck Grim has a price elasticity of;demand for beer of 1.2. Suppose that the price of beer is increased by 10;percent. What will happen to the total amount Chuck spends on beer? (Points;4);It will not change.;It will decrease.;It will increase.;It is impossible to tell.;Question 8. 8. (TCO 2) The elasticity of supply for a;product will be 2 if: (Points: 4);A 1 percent decrease in the price causes a 0.2 percent decrease;in quantity supplied;A 2 percent decrease in price causes a 1 percent decrease in;quantity supplied;A 1 percent decrease in price causes a 2 percent decrease in;quantity supplied;A 2 percent decrease in price causes a 2 percent decrease in;quantity supplied;Question 9. 9. (TCO 2) Which is true for a purely;competitive firm in short-run equilibrium? (Points: 4);The firm is making only normal profits.;The firm's marginal cost is greater than its marginal;revenue.;The firm's marginal revenue is equal to its marginal cost.;A decrease in output would lead to a rise in profits.;Question 10. 10. (TCO 2) Consumers who clip and redeem;discount coupons (Points: 4);exhibit the same price elasticity of demand for a given;product than consumers who do not clip and redeem coupons.;exhibit more price elasticity of demand for a given product;than consumers who do not clip and redeem coupons.;exhibit less price elasticity of demand for a given product;than consumers who do not clip and redeem coupons.;cause total revenue to decrease for firms that issue coupons;for their products.;Question 11. 11. (TCO 3) A major reason that firms form a;cartel is to (Points: 4);reduce the elasticity of demand for the product.;enlarge the market share for each producer.;minimize the costs of production.;maximize joint profits.;Question 12. 12. (TCO 3) In the short run, output (Points;4);is absolutely fixed.;can vary as the result of using a fixed amount of plant and;equipment more or less intensively.;may be altered by varying the size of plant and equipment;which now exist in the industry.;can vary as the result of changing the size of existing;plants and by new firms entering or leaving the industry.;Question 13. 13.;(TCO 4) Refer to the diagram. The phases of the business;cycle from points A to D are, respectively;Graph Description;(Points: 4);Peak, recession, expansion, trough;Trough, recovery, expansion, peak;Expansion, recession, trough, peak;Peak, recession, trough, expansion;Question 14. 14. (TCO 4) In calculating the unemployment;rate, part-time workers are (Points: 4);counted as unemployed because they are not working;full-time.;counted as employed because they are receiving payment for;work.;used to determine the size of the labor force, but not the;unemployment rate.;treated the same as "discouraged" workers who are;not actively seeking employment.;Question 15. 15. (TCO 4) GDP is the market value of (Points;4);resources (land, labor, capita, and entrepreneurship) in an;economy in a given year.;all final goods and services produced in an economy in a;given year.;consumption and investment spending in an economy in a given;year.;all output produced and accumulated over the years.;Question 16. 16. (TCO 4) Nominal GDP differs from real GDP;because (Points: 4);nominal GDP is based on constant prices.;real GDP is based on current prices.;real GDP is adjusted for changes in the price level.;nominal GDP is adjusted for changes in the price level.;Question 17. 17. (TCO 6) The goal of expansionary fiscal;policy is to increase (Points: 4);the price level.;aggregate supply.;real GDP.;unemployment.;Question 18. 18. (TCO 6) Refer to the figure. The economy is;at equilibrium at Point B. What would expansionary fiscal policy do?;Graph Description;(Points: 4);Shift aggregate demand from AD2 to AD1;Shift aggregate demand from AD2 to AD3;Move the economy from Point B downward along AD2;Move the economy from Point B upward along AD2;Question 19. 19. (TCO 6) The American Recovery and;Reinvestment Act of 2009 is a clear example of (Points: 4);nondiscretionary expansionary fiscal policy.;nondiscretionary contractionary fiscal policy.;discretionary contractionary fiscal policy.;discretionary expansionary fiscal policy.;Question 20. 20. (TCO 6) The time which elapses between the;beginning of a recession or an inflationary episode and the identification of;the macroeconomic problem is referred to as a(n) (Points: 4);budget lag.;recognition lag.;operational lag.;administrative lag.;3. (TCO 5) A fall in labor costs will cause aggregate;(Points: 4);supply to increase.;demand to increase.;supply to decrease.;demand to decrease.;6. (TCO 7) As of January 2010, slightly more than half of;the money supply (M1) was in the form of (Points: 4);currency.;checkable deposits.;gold coins and bars.;savings deposits.;Question 7. 7. (TCO 7) The basic requirement of money is;that it be (Points: 4);backed by precious metals--gold or silver.;authorized as legal tender by the central government.;generally accepted as a medium of exchange.;some form of debt or credit.;Question 8. 8. (TCO 7) How many members can serve on the;Board of Governors of the Federal Reserve System? (Points: 4);Seven;Nine;12;14;Question 9. 9. (TCO 7) Which group is responsible for the;policy of changing the money supply? (Points: 4);Federal Open Market Committee;Office of Management and Budget;Thrift Advisory Council;Federal Advisory Council;Question 10. 10. (TCO 7) The Federal funds rate is the rate;that banks pay for loans from (Points: 4);the Fed.;the U.S. Treasury.;other banks.;large corporations.;Question 11. 11. (TCO 7) During the financial crisis of;2007-2008, the FDIC increased deposit insurance coverage from (Points: 4);$50,000 to $100,000 per account.;$100,000 to $250,000 per account.;$200,000 to $500,000 per account.;$500,000 to $1,000,000 per account.;Question 12. 12. (TCO 7) The purchase and sale of government;securities by the Fed is called (Points: 4);federal funds market.;open market operations.;money market transactions.;term auction facility.;Question 13. 13. (TCO 7) The most frequently used monetary;device for achieving price stability is: (Points: 4);open market operations.;the discount rate.;the reserve ratio.;the prime interest rate.;Question 14. 14. (TCO 8) Which country is the United States;largest trading partner in terms of volume of trade? (Points: 4);Mexico;Japan;China;Canada;Question 15. 15. (TCO 8) In a two-nation world, comparative;advantage means that one nation can produce (Points: 4);a product with fewer inputs than the other nation.;a product at lower average cost than the other nation.;a product at a lower domestic opportunity cost than the;other nation.;more of a product than the other nation.;Question 16. 16. (TCO 8) A tariff is a (Points: 4);tax.;price ceiling.;quantity limit.;subsidy.;Question 17. 17. (TCO 8) If a nation agrees to set an upper;limit on the total amount of a product that it exports to another nation, then;this situation would be an example of (Points: 4);an import quota.;a revenue tariff.;a protective tariff.;a voluntary export restriction.;Question 18. 18. (TCO 8) When tariffs on imported products;are removed by a nation, it will result in (Points: 4);higher prices and lower quantities consumed.;higher prices and quantities consumed.;lower prices and quantities consumed.;lower prices and higher quantities consumed.;Question 19. 19. (TCO 8) A major goal of the World Trade;Organization is to (Points: 4);increase the protection of producers against foreign trade;competition.;encourage bilateral trade agreements between nations.;liberalize international trade among nations.;maximize tariff revenue for governments.;Question 20. 20. (TCO 9) U.S. businesses are demanders of;foreign currencies because they need them to (Points: 4);produce goods and services exported to foreign countries.;pay for goods and services imported from foreign countries.;receive interest payments from foreign governments.;receive interest payments from foreign businesses.;1. (TCO 9) Remittances of Mexican workers in the U.S. to;their families in Mexico are included in the U.S. balance of payments as a;debit in the section on (Points: 4);trade in services.;net international transfers.;financial accounts.;capital accounts.


Paper#55620 | Written in 18-Jul-2015

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