The table below shows data for Indonesia.
2009 2010
Real GDP growth rate 4.5 6.0
Inflation rate 4.8 5.7
Assuming the rate of velocity change is constant, the money growth rate in Indonesia was
A) 0.3 percent in 2009.
B) 11.7 percent in 2010.
C) -0.3 percent in 2009.
D) 5.7 percent in 2010.
Ques. 2Suppose consumers decide they value a product more highly than before. Then the efficient quantity to produce of that product ________.
A) increases
B) does not change
C) decreases
D) perhaps changes, but without more information the direction of the change cannot be told
Ques. 3The Coase theorem says that which of the following is necessary to lead to an efficient use of resources?
A) presence of transaction costs
B) existence of property rights
C) government intervention
D) All of the above answers are correct.
Ques. 4The above figure shows the demand and cost curves for a firm in monopolistic competition. The firm makes the maximum profit when the marginal cost of last item produced equals
A) 5.
B) 10.
C) 15.
D) 20.
Ques. 5From the social perspective, a major criticism of oligopolies is that
A) successful collusion leads to a monopoly-like outcome.
B) price wars usually break out.
C) advertising hardly ever occurs.
D) cartels are unstable.
Ques. 6The vertical distance between the total variable cost curve and the total cost curve ________ as output increases; the vertical distance between the average variable cost curve and the average total cost curve ________ as output increases.
A) decreases; remains the same
B) is constant; becomes smaller
C) increases; becomes smaller at first but then increases
D) increases; remains the same
Ques. 7The quantity of a public good supplied by a private market is
A) smaller than the efficient quantity.
B) equal to the efficient quantity.
C) larger than the efficient quantity.
D) the quantity that maximizes total public benefit.
Ques. 8The figure above shows the market for milk in Cowland. If a subsidy paid to producers of 1 per gallon of milk is introduced, how many gallons are sold per year?
A) 200 million
B) 400 million
C) 300 million
D) more than 300 million but less than 400 million
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