ECO 550 Multiple Choice Questions

Question 1  

  The Saturn Corporation (once a division of GM) was permanently closed in 2009. What went wrong with Saturn?

 Question 2 

  A Real Option Value is:

 Question 3

  In the shareholder wealth maximization model, the value of a firm's stock is equal to the present value of all expected future ____ discounted at the stockholders' required rate of return.

 Question 4 

  Economic profit is defined as the difference between revenue and ____.

 

 Question 5 

  The primary difference(s) between the standard deviation and the coefficient of variation as measures of risk are:

  

 Question 6

  The level of an economic activity should be increased to the point where the ____ is zero.

 

 Question 7

  Generally, investors expect that projects with high expected net present values also will be projects with

 

 Question 8

  Based on risk-return tradeoffs observable in the financial marketplace, which of the following securities would you expect to offer higher expected returns than corporate bonds?

 

 Question 9

  Those goods having a calculated income elasticity that is negative are called:

 

 Question 10 

  A price elasticity (ED) of −1.50 indicates that for a ____ increase in price, quantity demanded will ____ by ____.

 

 Question 11 

  Marginal revenue (MR) is ____ when total revenue is maximized.

 

 Question 12

  Which of the following would tend to make demand INELASTIC?

 Question 13 

  The standard deviation of the error terms in an estimated regression equation is known as:

 

 Question 14

  The estimated slope coefficient (b) of the regression equation (Ln Y = a + b Ln X) measures the ____ change in Y for a one ____ change in X.

 

 Question 15

  One commonly used test in checking for the presence of autocorrelation when working with time series data is the ____.

 

 Question 16 

  The Identification Problem in the development of a demand function is a result of:

 Question 17 

  An example of a time series data set is one for which the:

 

 Question 18 

  The forecasting technique which attempts to forecast short-run changes and makes use of economic indicators known as leading, coincident or lagging indicators is known as:

 

 Question 19 

  The type of economic indicator that can best be used for business forecasting is the:

 

 Question 20 

  For studying demand relationships for a proposed new product that no one has ever used before, what would be the best method to use?

 

 Question 21 

  An increase in the exchange rate of the U.S. dollar relative to a trading partner can result from

 

 Question 22 

  Trading partners should specialize in producing goods in accordance with comparative advantage, then trade and diversify in consumption because

 

 Question 23 

  In a recession, the trade balance often improves because

   

 Question 24

  An appreciation of the U.S. dollar has what impact on Harley-Davidson (HD), a U.S. manufacturer of motorcycles?

  

 Question 25

  If the marginal product of labor is 100 and the price of labor is 10, while the marginal product of capital is 200 and the price of capital is $30, then what should the firm?

  

 Question 26 

  The marginal product is defined as:

  

 Question 27 

  The marginal rate of technical substitution may be defined as all of the following except:

Question 28

  Given a Cobb-Douglas production function estimate of Q = 1.19L.72K.18 for a given industry, this industry would have:

  

 Question 29 

  ____ are defined as costs which are incurred regardless of the alternative action chosen in a decision-making problem.



 Question 30 

  What method of inventory valuation should be used for economic decision-making problems?


 Question 31 

  Which of the following statements concerning the long-run average cost curve of economic theory is true?


 Question 32 

  The existence of diseconomies of scale (size) for the firm is hypothesized to result from: