Economics

6 years ago

Suppose an employer has monitoring devices established so that the probability of an employee being ...

Suppose an employer has monitoring devices established so that the probability of an employee being caught while shirking is 0.2. If the gain to the employee from shirking is $1,000, how large a bond will deter shirking?

Llanis 55 1 Reply

Chronos

6 years ago

The nominal price of industrial red paint was $12 per gallon in 1993. To convert this value to the ...

The nominal price of industrial red paint was $12 per gallon in 1993. To convert this value to the real price of paint in 2012 dollars, we should use the:
A) Consumer Price Index.
B) Producer Price Index
C) Fed funds rate.
D

corie 55 1 Reply

6 years ago

Suppose the Social Security Administration would like to guarantee the purchasing power of social ...

Suppose the Social Security Administration would like to guarantee the purchasing power of social security payments to the elderly does not diminish. That is, the real value of the payments does not decrease. The CPI in 1990 was 130.7 and

nakungth 55 1 Reply

6 years ago

Refer to Scenario 2.1. What is the equilibrium quantity of books sold?

Refer to Scenario 2.1. What is the equilibrium quantity of books sold?
A) 25
B) 50
C) 75
D) 100
E) none of the above

Satsume 55 1 Reply

6 years ago

Suppose that the short-run world demand and supply elasticities for crude oil are -0.076 and 0.088, ...

Suppose that the short-run world demand and supply elasticities for crude oil are -0.076 and 0.088, respectively. The current price per barrel is $30 and the short-run equilibrium quantity is 23.84 billion barrels per year. Derive the lin

nakungth 55 2 Replies

5 years ago

What happens if price falls below the market clearing price?

What happens if price falls below the market clearing price?
A) Demand shifts out.
B) Supply shifts in.
C) Quantity demanded decreases, quantity supplied increases, and price falls.
D) Quantity demanded increases, quantity sup

Satsume 55 1 Reply

6 years ago

Other things being equal, the increase in rents that occurs after rent controls are abolished is ...

Other things being equal, the increase in rents that occurs after rent controls are abolished is smaller when
A) the own price elasticity of demand for rental homes is price inelastic.
B) the own price elasticity of demand for rental home

corie 55 1 Reply

6 years ago

If a market basket is changed by adding more of at least one good, then rational consumers will:

If a market basket is changed by adding more of at least one good, then rational consumers will:
A) rank the market basket more highly after the change.
B) more likely prefer a different market basket.
C) rank the market basket as b

Satsume 55 1 Reply

6 years ago

Use the following two statements to answer this question: I.If utility is ordinal, a market basket ...

Use the following two statements to answer this question:
I. If utility is ordinal, a market basket that provides 30 utils provides twice the satisfaction of a market basket that provides 15 utils.
II. When economists first studied utility

Satsume 55 1 Reply

6 years ago

Marginal utility measures: (Multiple Choice)

Marginal utility measures:
A) the slope of the indifference curve.
B) the additional satisfaction from consuming one more unit of a good.
C) the slope of the budget line.
D) the marginal rate of substitution.
E) none of

nakungth 55 2 Replies

5 years ago

In closing down a military base, environmental inspectors found 100 tons of toxic waste. Which of ...

In closing down a military base, environmental inspectors found 100 tons of toxic waste. Which of the following is NOT a determinant of the consumer surplus generated by cleaning up 40 tons of waste?
A) The price of removing a ton of toxi

corie 55 1 Reply

6 years ago

Refer to Scenario 5.4. What is the variance of the investment?

Refer to Scenario 5.4. What is the variance of the investment?
A) -75
B) 275
C) 3,150
D) 4,637.50
E) 8,125

corie 55 1 Reply

6 years ago

Refer to Table 5.1. A risk-neutral individual making a decision solely on the basis of the above ...

Refer to Table 5.1. A risk-neutral individual making a decision solely on the basis of the above information would choose to major in
A) accounting.
B) economics.
C) English.
D) political science.
E) mathematics.

nakungth 55 2 Replies

5 years ago

When facing a 50% chance of receiving $50 and a 50% chance of receiving $100, the individual ...

When facing a 50% chance of receiving $50 and a 50% chance of receiving $100, the individual pictured in Figure 5.2
A) would pay a risk premium of 10 utils to avoid facing the two outcomes.
B) would want to be paid a risk premium of 10 ut

corie 55 1 Reply

6 years ago

Refer to Scenario 5.8. Without additional information, Icarus Airlines would:

Refer to Scenario 5.8. Without additional information, Icarus Airlines would
A) lease only the one airplane it is sure it can use.
B) lease 2 airplanes in order to guarantee it avoids the worst outcome, $10 million.
C) lease 3

corie 55 1 Reply

6 years ago

Daring Dora holds 90% of her assets in high-technology stocks, earning 12%, and 10% in long-term ...

Daring Dora holds 90% of her assets in high-technology stocks, earning 12%, and 10% in long-term government bonds, earning 6%. The expected return on her portfolio
A) is 6%.
B) is 9%.
C) is 11.4%
D) is 12%.
E) cann

Satsume 55 1 Reply

6 years ago

Which of the following statements is NOT true?

Which of the following statements is NOT true?
A) Speculative demand for an asset may contribute to the formation of a bubble.
B) Some asset prices purchased during the formation of a bubble may be rational.
C) Asset price bubbles are

corie 55 1 Reply

6 years ago

Which of the following events will help to burst an asset price bubble?

Which of the following events will help to burst an asset price bubble?
A) Speculative demand for the asset quickly declines.
B) Speculative demand for the asset quickly increases.
C) New information leads buyers to doubt that prices w

Satsume 55 1 Reply

6 years ago

Many mining and mineral extraction processes tend to exhibit increasing returns to scale. Suppose ...

Many mining and mineral extraction processes tend to exhibit increasing returns to scale. Suppose copper mines have increasing returns, and the existing copper mines reduce their capital and labor inputs by 25 percent in response to a global re

corie 55 1 Reply

6 years ago

Two small airlines provide shuttle service between Las Vegas and Reno. The services are alike in ...

Two small airlines provide shuttle service between Las Vegas and Reno. The services are alike in every respect except that Fly Right bought its airplane for $500,000, while Fly by Night rents its plane for $30,000 a year. If Fly Right wer

Satsume 55 1 Reply

6 years ago

In 1985, Alice paid $20,000 for an option to purchase ten acres of land. By paying the $20,000, she ...

In 1985, Alice paid $20,000 for an option to purchase ten acres of land. By paying the $20,000, she bought the right to buy the land for $100,000 in 1992. When she acquired the option in 1985, the land was worth $120,000. In 1992, i

nakungth 55 1 Reply

6 years ago

Use the following statements to answer this question:I.Markets may be highly (but not perfectly) ...

Use the following statements to answer this question:
I. Markets may be highly (but not perfectly) competitive even if there are a few sellers.
II. There is no simple indicator that tells us when markets are highly competitive.
A) I an

nakungth 55 2 Replies

5 years ago

If any of the assumptions of perfect competition are violated,:

If any of the assumptions of perfect competition are violated,
A) supply-and-demand analysis cannot be used to study the industry.
B) graphs with flat demand curves cannot be used to study the firm.
C) graphs with downward-sloping d

corie 55 1 Reply

6 years ago

Higher input prices result in:

Higher input prices result in
A) upward shifts of MC and reductions in output.
B) upward shifts of MC and increases in output.
C) downward shifts of MC and reductions in output.
D) downward shifts of MC and increases in output

Satsume 55 1 Reply

6 years ago

The marginal cost curves of six firms in an industry appear in the table below. If these firms ...

The marginal cost curves of six firms in an industry appear in the table below. If these firms behave competitively, determine the market supply curve. Calculate the elasticity of market supply at $5.

Firm Marginal cost
F

corie 55 1 Reply

6 years ago

Consumer surplus measures: (Multiple Choice)

Consumer surplus measures
A) the extra amount that a consumer must pay to obtain a marginal unit of a good or service.
B) the excess demand that consumers have when a price ceiling holds prices below their equilibrium.
C) the benefi

Satsume 55 1 Reply

6 years ago

In an unregulated, competitive market consumer surplus exists because some:

In an unregulated, competitive market consumer surplus exists because some
A) sellers are willing to take a lower price than the equilibrium price.
B) consumers are willing to pay more than the equilibrium price.
C) sellers will onl

Satsume 55 1 Reply

6 years ago

In an unregulated competitive market, supply and demand have been estimated as follows: Demand P = ...

In an unregulated competitive market, supply and demand have been estimated as follows:
Demand P = 25 0.10Q Supply P = 4 + 0.116Q,
where P represents unit price in dollars, and Q represents number of units so

Satsume 55 1 Reply

6 years ago

Suppose a government imposes an import tariff that is too large and exceeds the tax required to ...

Suppose a government imposes an import tariff that is too large and exceeds the tax required to completely shut down foreign imports. What is the impact of this mistake on the market outcome?
A) The impact is the same as intended --- there

Satsume 55 1 Reply

6 years ago

A monopolist has equated marginal revenue to zero. The firm has:

A monopolist has equated marginal revenue to zero. The firm has:
A) maximized profit.
B) maximized revenue.
C) minimized cost.
D) minimized profit.

corie 55 1 Reply

6 years ago

Refer to Scenario 10.3. At the profit-maximizing level of output, demand is:

Refer to Scenario 10.3. At the profit-maximizing level of output, demand is
A) completely inelastic.
B) inelastic, but not completely inelastic.
C) unit elastic.
D) elastic, but not infinitely elastic.
E) infinitely

nakungth 55 2 Replies

5 years ago

After the imposition of a tax of $2 per unit of output, what is the profit maximizing price?

After the imposition of a tax of $2 per unit of output, what is the profit maximizing price?
A) 11
B) 21
C) 31
D) 41
E) none of the above

corie 55 1 Reply

6 years ago

Suppose a government sets theprice for a natural monopoly at the competitive level such that P = MC. ...

Suppose a government sets theprice for a natural monopoly at the competitive level such that P = MC. To keep the seller from taking a loss under this policy, the government could provide a lump-sum payment to the firm. How could we determ

corie 55 1 Reply

6 years ago

Refer to Scenario 13.9. If this game is repeated over an infinite or uncertain horizon, the most ...

Refer to Scenario 13.9. If this game is repeated over an infinite or uncertain horizon, the most likely observed behavior will be that
A) both firms pollute.
B) only Lago pollutes.
C) only Nessie pollutes.
D) neither fir

corie 55 1 Reply

6 years ago

The substitution effect of a decrease in the wage will:

The substitution effect of a decrease in the wage will
A) decrease leisure, regardless of whether leisure is a normal or inferior good.
B) increase leisure, regardless of whether leisure is a normal or inferior good.
C) increase lei

nakungth 55 1 Reply

6 years ago

Under what circumstances are the marginal expenditure for an input and the average expenditure ...

Under what circumstances are the marginal expenditure for an input and the average expenditure always equal? Where there is a
A) competitive buyer.
B) competitive seller.
C) monopoly buyer.
D) monopoly seller.

Satsume 55 1 Reply

6 years ago

Under what circumstances will the economic rent earned by a factor of production always be zero?

Under what circumstances will the economic rent earned by a factor of production always be zero?
A) Infinitely inelastic supply curve
B) Infinitely elastic supply curve
C) Somewhat inelastic supply curve
D) Elastic demand curv

Satsume 55 1 Reply

6 years ago

In the situation involving a bilateral monopoly, a:

In the situation involving a bilateral monopoly, a
A) single firm acts as both the monopsonist and the monopoly.
B) single seller sells to a single buyer.
C) monopsonist sells to a monopsonist.
D) monopolist sells to a monopol

Satsume 55 1 Reply

6 years ago

Refer to Scenario 15.4. The net present value of the purchase is:

Refer to Scenario 15.4. The net present value of the purchase is
A) $200 × 10 - $800.
B) $200/1.06 - $800.
C) $200/1.0610 - $800.
D) $200 × (1 + 1/1.06 + 1/1.062 + ... + 1/1.069) - $800.
E) $200 / (1 + 1/1.06 + 1/1

corie 55 1 Reply