Flashcards

econ final

Jordyn McEvoy English 105 cards

Cards in this deck (105)

1—R
2—24 Pounds
3—An epidemic that wipes out 15% of the population
4—2 units of capital goods
5—
6—
7—Amos makes cookies, Debbi makes brownies
8—
9—1 sausage to between 5/4 to 4 olives
10—
11—
12—
13—A. Consumer Spending and B. Business Income
14—I and III
15—
16—
17If resources are overallocated to production of a good, this means thatmarginal costs of production are greater than the marginal benefits.
18—A quantity of 3 represents underallocation of resources to production of premium coffee
19—40
20—P4 and Q4
21With conventional supply and demand curves, If both demand and supply increase,both equilibrium price and quantity would increase.
22—shortage of 30 units
23—Price will increase, quantity demanded will decrease and quantity supplied will increase
24—Blue jeans are a normal good and incomes increase, and the price of cotton, used to produce denim, increases.
25Which of the following best describes the law of demand?If the price of a product increases, the quantity demanded will decrease.
26Which of the following best describes the law of supplyThe relationship between price and quantity is direct, all other things equal.
27Which of the following are determinants for the supply of paper? I. A change in expectations about future prices of paper II. A change in the number of companies selling paper III. A change in the price of wood pulp used to make paper IV. A change in the price of substitutes for paperI, II, and III
28—he demand for lemonade made with real lemons has increased, and a newly invented machine decreases the cost of harvesting lemons.
29Which of the following do economists expect to occur when the government sets effective price ceilings or floors in markets that are currently allocatively efficient?All of the above
30—ere would be a shortage of 100 tickets.
31—shortage of 900 rental units
32Which of the following correctly describes a goal of the government when imposing a price control?The government sets an effective price ceiling on a particular product in an attempt to benefit consumers by lowering the price of that product.
33The cross-elasticity of demand coefficient for lettuce and tomatoes is −2.4. Based on this information, what is the relationship between these two goods?complements
34If the government wants to increase revenue by imposing a per-unit excise tax, which of the following types of goods would allow it to BEST achieve that objective?Goods with perfectly inelastic demand.
35All of the following are determinants of elasticity of demand EXCEPTexpectations concerning price
36If the coefficient for elasticity of demand is 0, the demand isperfectly inelastic
37A bookstore raises the price of its coffee by 10%, and the spending by its customers on coffee (the total revenue) does not change. This indicates that, in this price range, demand for this store's coffee isunit elastic
38If the elasticity of demand coefficient for sunglasses is 0.25, which of the following price changes would decrease the quantity demanded by 10%?increase by 40%
39If total gate receipts for sales of concert tickets decrease when the price is increasedthe demand for the tickets is elastic.
40As income increases from $10,000 to $20,000, the quantity of hot dogs demanded decreases from 100 to 20. This means that hot dogsare inferior goods.
41Eggs and bacon are complements, and eggs and cereal are substitutes. Which of the following could be true based on this information?The cross-elasticity coefficient for eggs and cereal is 1.8.
42The computer market includes two manufacturers, Peach and Kiwi. When the price in the market is $100, Peach will produce 100 computers and Kiwi will produce 200. When the price rises to $200, Peach will produce 200 computers, and Kiwi will produce 300. When the market price increases from $100 to $200, what is the market elasticity of supply using the midpoint formula?0.75
43Which of the following is an example of producer surplus?When the price of gummy bears is $3 a bag, the quantity supplied is 25,000 and the quantity demanded is 17,000.
44—$150
45Which of the following explains why the law of diminishing marginal returns occurs?Additional variable resources crowd fixed resources
46A unique short-run problem in the production of a particular good is the Law of Diminishing Marginal Returns. Which of the following statements best explains this phenomenon?As more workers are added to work on a project that has a fixed amount of capital resources for them to work on, beyond some point the resulting extra output will begin to decline.
47In the long run, a firm increases its inputs by 15%, and its outputs increase by 25%. Which of the following is TRUE?The firm's total costs are increasing.
48All of the following can be used to explain why a firm experiences economies of scale EXCEPTfixed factory size.
49Each year you give the workers of your company an increase in wages. This would causea shift upward of the AVC, ATC, and MC
50—$40
51Consider the following market structure types. In which of the market structures above are long-run economic profits possible?III AND IV
52Which of the following below would be subtracted from total revenue to calculate economic profits? I. Property taxes II. Electricity costs III. Wages from job sacrificed to start new business IV. Interest forgone when funds are used to buy equipmentI, II , III and IV
53Which of the following describes a situation in which a firm is earning normal profits?The firm's accounting profits are equal to its implicit costs
54Which of the following describe(s) the output at which an individual firm would be profit-maximizing? I. Marginal cost exceeds marginal revenue by the greatest amount. II. Marginal revenue is equal to marginal cost. III. Total revenue exceeds total cost by the greatest amount. IV. Marginal revenue exceeds marginal cost by the greatest amount.II and III only
55Which of the following correctly describe methods for calculating a firm's economic profits or losses?II and III only.
56If positive externalities exist in a perfectly competitive market with no government intervention, which of the following is TRUE?The marginal social benefit will exceed the marginal private benefit.
57Which of the following is an example of a positive externality?"Herd" immunity that leads to protection from disease as a result of others being vaccinated against the disease
58If the production of doughnuts creates a pleasant smell that benefits those who live near the doughnut factory, even though they are not involved in the production or purchase of the doughnuts. Assuming doughnuts are produced and sold in a perfectly competitive market, which of the following would be TRUE?Marginal social benefit would exceed marginal social cost at equilibrium
59Which of the following describes an appropriate remedy for a specific market failure?The government provides free whooping cough vaccines because these vaccines create positive externalities
60—$2 per-unit tax.
61—Negative externality.
62—$15
63—P1
64Assuming it should produce, if a perfectly competitive firm is currently producing output such that the price of the last unit produced is $15 and the marginal cost of the last unit is $10, that firm could increase its profit byincreasing its output.
65In which of the following situations will a perfectly competitive firm produce the productively efficient output?It is earning normal profits in the long-run.
66Which of the following statements can be said of a perfectly competitive firm in long-run equilibrium?A and B only
67If a firm shuts down in the short-run, its losses will equalits total fixed costs.
68—Industry supply would increase; price would decrease; quantity would increase.
69—P2 and Q2
70A perfectly-competitive firm should always shut down in the short-run if which of the following is true?Market price is below average variable cost.
71—Earning a profit equal to area PABC
72—It falls, leaving all firms at a break-even point
73—$2
74—$80
75—$320
76—$80
77Which of the following is true about a perfectly competitive firm’s supply curve?It is the portion of the marginal cost curve lying above the average variable cost curve.
78—pafd
79A perfectly-competitive firm will operate in the short-run only ifotal revenue exceeds total variable cost
80—$45
81—$30
82—4
83—P4
84—The firm's price will increase, and the firm's output will increase.
85—The output of the industry will increase, and the output of the firm will decrease.
86The wool industry is perfectly competitive and currently in long-run equilibrium. The government grants a lump-sum subsidy to firms operating in the wool industry. Assuming the government continues to provide the lump-sum subsidy, what do economists predict will happen to the profit-maximizing output and price for individual producers of wool as it adjusts to a new long-run equilibrium?Output and price will both decrease
87As compared to a perfectly-competitive industry with the same costs, the equilibrium price for a monopoly would behigher, and its output would be lower.
88A pharmaceutical company owns a patent for an antibiotic, and it is currently earning positive economic profits from sales of the medication. Following the expiration of the patent, what is the most likely impact on the market price and the company's profit for this medication?Market price will decrease, and profits will decrease.
89Entry barriers that lead to the creation of monopolies includeownership of resources.
90Regardless of whether a firm is a monopoly or a member of an oligopolistic or monopolistically competitive industry, a graph of any non-discriminating, imperfectly competitive firm will have which of the following characteristics?The marginal revenue curve will reside below the demand curve because any reduction in price applies to all units sold.
91In which of the following situations is a firm likely to have the GREATEST market power?The firm sells a unique product with no close substitutes.
92Which of the following is NOT a characteristic of a monopoly?Price taker
93The relative elasticity of the slope of the monopolist’s demand curve is impacted significantly by the level of barriers to entry by rival firms. Which of the following statements reflects an accurate relationship between barriers to entry and the price elasticity of demand for the monopolists’ product?The stronger the barriers to entry, the more inelastic is the monopolist’s demand curve.
94The following are the four different types of market structures for product markets. I. Perfect Competition II. Monopolistic Competition III. Oligopoly IV. Monopoly In which of the above market structures would a firm be a price maker (searcher)?II, III, and IV
95The minimum condition for a monopoly to continue to operate in the long run is that it mustearn at least a normal profit.
96—C only
97Which of the following describes how perfect price discrimination by a monopoly affects the amount of consumer surplus?Consumer surplus falls to zero because consumers must pay the maximum price they are willing to pay.
98—increase from Q1 to Q2.
99—he will obtain a marginal revenue of $6.
100—The firm's total revenue is represented by area 0P4DQ1.
101—P4, P1, and P3 respectively.
102—a profit of P2P3ab
103Which of the following is true at the profit-maximizing output for a perfectly competitive firm but NOT for a monopoly, if both are earning economic profits?P=MC
104Which of the following statements regarding the allocation of resources is NOT true?Resources are efficiently allocated when positive externalities exist in a perfectly-competitive market.
105—