Economics Mulitple Choice Questions

A) 

an English clergyman who lived in the early 1800's.

B) 

one of the earliest economic authors to warn about population growth.  

C) 

a futurist who warned that overpopulation could result in mass starvation.  

D) 

all of the above

A) 

negative.

B) 

around zero.

C) 

close to 1. 

D) 

off the charts!

A) 

cultivation of more land for agriculture.

B) 

improvements in the technology of agricultural production.

C) 

better weather forecasting.

D) 

increasing number of people becoming farmers. 

A) 

has continued to grow exponentially.

B) 

has been declining since the 1970's.

C) 

increased in the 1980's, but flattened out in the 1990's and beyond.

D) 

has remained unchanged for decades.

A) 

prices that relate to how much people enjoy something.

B) 

observing prices in goods and services related to a particular environmental asset.

C) 

observing prices in goods and services not related to a particular environmental asset.

D) 

prices that relate to how much people do not enjoy something.

A) 

data on such prices is poorly collected, and therefore unreliable. 

B) 

there is weak theoretical support that such an approach is meaningful.

C) 

large datasets are typically needed to establish significant relationships between the prices and environmental variables.

D) 

not much data are actually available.

A) 

ozone depletion

B) 

greenhouse gases

C) 

deforestation

D) 

ocean pollution

A) 

riots against the Vietnam War.

B) 

an Indian war that happened in the mid-1800's.

C) 

street protests against the WTO meeting there in 1999. 

D) 

a flash mob that turned into a riot with the police. 

A) 

output price.

B) 

marginal physical product of labor.

C) 

price of labor.

D) 

marginal cost of production.

A) 

advances in telecommunications and computer networking.

B) 

firms that are becoming more risk-averse.

C) 

support from organized labor.

D) 

sharp increases in the cost of overseas labor.

A) 

$700

B) 

$4200

C) 

$630

D) 

$3500

A) 

cause the demand curve for labor for managers to increase.

B) 

increase the elasticity of demand for labor for managers.

C) 

lead to an increase in the supply curve of labor for managers.

D) 

leave the supply curve of labor unchanged.

A) 

$221

B) 

$8.50

C) 

$1190

D) 

$26

A) 

assures the firm an economic profit.

B) 

requires that resources be used in combinations such that marginal products are equal.

C) 

requires that the marginal physical product per dollar spent for each resource is equalized.

D) 

assures the firm a normal profit.

A) 

28

B) 

27

C) 

26

D) 

29

A) 

5

B) 

4

C) 

2

D) 

3

A) 

labor engagement.

B) 

unfair trade practices.

C) 

outsourcing.

D) 

predatory pricing.

A) 

derived from the satisfaction that hiring the inputs provides the owner or manager of the firm more money.

B) 

derived from the demand for the final product being produced.

C) 

derived from a utility maximizing process similar to that used to derive the demand curve for goods and services.

D) 

totally unrelated to the demand curve for the final product.

A) 

it earns accounting profits.

B) 

the additional cost of a worker equals the additional revenue from the worker.

C) 

total product is rising.

D) 

the company reaches its breakeven output level.

A) 

the change in total output resulting from a one-unit change in variable output.

B) 

the change in marginal output resulting from a one-unit change in variable input.

C) 

the change in total revenue resulting from a one-unit change in variable input.

D) 

the change in marginal revenue resulting from a one-unit change in variable input.

A) 

union shop.

B) 

agency shop.

C) 

closed shop.

D) 

open shop.

A) 

a non-union worker may be hired but must join the union within a certain time period.

B) 

only workers who have been union members for two years may be employed.

C) 

a worker may elect to either join or not join the union.

D) 

only union members may be employed by the firm.

A) 

Monopolistic exploitation

B) 

Monopsonistic exploitation

C) 

Bilateral monopoly

D) 

Featherbedding

A) 

limiting the supply of labor.

B) 

setting minimum wages.

C) 

limiting the demand for labor.

D) 

setting maximum wages.

A) 

erratic.

B) 

remaining constant.

C) 

declining.

D) 

rising.

A) 

the union must find a way to make union workers more productive.

B) 

the union must also negotiate a fringe-benefit package that the membership will like.

C) 

the union must find a way to ration jobs among the excessive number of workers who wish to work at the negotiated wage.

D) 

employment in the union sector will increase.

A) 

that a monopsonistic employer bargains with two unions.

B) 

that an industrial union bargains with a two-firm oligopoly.

C) 

that a monopsonistic employer bargains with a monopoly.

D) 

that a monopsonistic employer bargains with both an industrial and a craft union.

A) 

when more units of labor are hired, only the new workers receive the higher wage.

B) 

each additional unit of labor costs less.

C) 

diminishing marginal product to scale does not exist in a monopsony.

D) 

when more units of labor are hired, all laborers must receive the higher wage.

A) 

the supply curve for the good will be perfectly elastic.

B) 

a monopsony exists.

C) 

a closed shop exists.

D) 

then the market will be perfectly competitive.

A) 

raise wages by restricting the supply of union workers.

B) 

increase the productivity of union labor.

C) 

remind consumers that if they do not buy union-made goods, unions will strike.

D) 

increase the derived demand for union labor by shifting consumer preferences in favor of union-made goods.

A) 

shifted toward the poorer 20 percent away from the richer 20 percent.

B) 

become slightly more unequal.

C) 

become more equal.

D) 

not dramatically changed.

A) 

increase.

B) 

increase or decrease.

C) 

not change.

D) 

decrease.

A) 

less the overall wealth in the economy.

B) 

greater the overall wealth in the economy.

C) 

less equal the income distribution.

D) 

more equal the income distribution.

A) 

both income and wealth are unequally distributed in a country.

B) 

workers with the same marginal revenue products are paid different wages.

C) 

there is an unequal distribution of income in a country.

D) 

there is unequal access to education.

A) 

relative poverty.

B) 

both absolute and relative poverty.

C) 

either absolute nor relative poverty.

D) 

absolute poverty.

A) 

wellness training.

B) 

blue-zoning.

C) 

moral hazard.

D) 

healthy selection.

A) 

declined rapidly since 1965.

B) 

remained constant over the last few years.

C) 

risen steadily since 1965.

D) 

remained below the level of inflation.

A) 

firms discriminate against older workers.

B) 

people are retiring earlier.

C) 

the experience of people is no longer valuable after they are 50 or 55.

D) 

people tend to reduce the number of hours they work after age 50.

A) 

is more equal than the distribution of income.

B) 

is equal for all families.

C) 

is the same as the distribution of income.

D) 

is more unequal than the distribution of income.

A) 

the number of poor in one state relative to another.

B) 

poverty levels at a stated income cutoff.

C) 

how a family's income compares to the incomes of those around them.

D) 

None of the above.

A) 

Lorenz curve.

B) 

Laffer curve.

C) 

distribution curve.

D) 

aggregate demand curve.

A) 

the aging population.

B) 

new technologies.

C) 

higher imports.

D) 

third party payments.

A) 

not true costs because they relate to time rather than real resources.

B) 

the costs associated with making, reaching, and enforcing agreements.

C) 

equal to the hourly cost of a lawyer used to write a contract.

D) 

the costs, such as sales taxes, that are imposed by the government.

A) 

found by setting the quantity of air pollution equal to the quantity of water pollution.

B) 

a meaningless concept since monetary values cannot be attached to problems associated with pollution.

C) 

found by equating the marginal benefits from further reductions in pollution and the marginal costs of further reductions in pollution.

D) 

whatever amount of pollution is produced by the profit maximizing firm.

A) 

slopes downward because of the law of diminishing returns.

B) 

slopes upward because firms will maximize profits.

C) 

slopes downward because of the law of diminishing marginal utility.

D) 

slopes upward because of the law of diminishing product.

A) 

John's neighbor has received an external benefit of John's bee-keeping.

B) 

John's neighbor has received an external cost of John's bee-keeping.

C) 

John's neighbor has received an internal cost of John's bee-keeping.

D) 

None of the above is correct.

A) 

only explicit costs.

B) 

internal costs.

C) 

opportunity costs.

D) 

external costs.

A) 

go out of business since pollution abatement is expensive.

B) 

will always decide to reduce the amount of pollution by reducing the quantity they produce.

C) 

increase the price of the product and the quantity produced to pay for the additional costs.

D) 

weigh the costs and benefits of each potential action and might decide to not stop polluting by paying a fine.

A) 

costs incurred by government and borne by all taxpayers.

B) 

costs incurred in governmental welfare programs.

C) 

external costs minus internal costs.

D) 

costs borne by society whenever a resource-using action takes place.

A) 

Pollution is only a private cost.

B) 

The transaction costs of pollution is too low.

C) 

The cost of using pollution free resources to generate power in many circumstances is much higher than generating that same power through conventional pollution-causing means.

D) 

Governments lack the political will to enforce the use of pollution free resources.

A) 

there is a tendency for resources to be under-utilized.

B) 

there is a tendency for resources to be over-utilized.

C) 

this means that resources are being efficiently used.

D) 

None of the above is correct.

A) 

the external costs of the activity are greater than the internal costs of the activity.

B) 

the full costs of the activity are the sum of private costs plus internal costs.

C) 

the external costs of the activity are greater than the private costs of the activity.

D) 

the social costs of the activity are greater than the private costs of the activity.