Quiz Step by Step 2. Economics - Microeconomics

1

Hannah's House of Hotcakes serves 30 customers in an hour when it hires one worker. It serves 60 customers in an hour when it hires two workers. The marginal product of the second worker is ________ customers served per hour.

2

Which of the following observations regarding the Gini coefficient (G) is incorrect?

3

Suits Only, a dry cleaning firm that specializes in cleaning business suits, operates in a perfectly competitive market. Robin Smith, an exceptionally talented manager, has been hired to manage Suits Only. In the dry cleaning business, a manager typically makes a salary of $400 per week. Suits Only faces the long-run average and marginal costs shown in the figure below. In long-run competitive equilibrium, the market price for cleaning a business suit is $4.50.<img src="https://sciemce.com/files/4/ppg__tttt0824191027__f1q174g1.jpg" alt="" style="vertical-align: 0.0px;" height="273" width="363" />Given the above, Robin Smith is probably going to negotiate a salary of ________ per week, ________ of which is economic rent.

4

Buying a cup of coffee with a dollar bill represents the use of money as a:

5

The business cycle consists of four phases. At the top we have:

6

The price of Kenwood blender increased from ȼ150 to ȼ250. Following the increase in price, quantity demanded of the blender dropped from 500 to 400.

7

Which of the following is an example of peak-load pricing?

8

A public good

9

Peter studies at the coffee shop around the corner, at the same time that John talks loudly on his cell phone. The costs and benefits of each cell phone call made by John are given by the following table: <img src="https://sciemce.com/files/4/ppg__rrrr0821190959__f1q89g1.jpg" alt="" style="vertical-align: 0.0px;" height="202" width="449" /> According to the Coase theorem, when the parties affected by externalities can negotiate costlessly with one another

10

Consider the relationship given by QCars = 100 + 4 × PCars - 2 × PSteel - 0.2 × PWorkers, where QCars is the quantity of cars supplied (in thousands), PCars is the price of cars (in thousands of dollars), PSteel is the price of steel, and PWorkers is the wage earned by autoworkers. If the price of steel is $10 per unit and the price of workers (the wage) is $20, what is the supply curve for cars?

11

The practice by a monopolist of charging each buyer the highest price he/she is willing to pay is called

12

The price elasticity of demand for cigarettes by adults is -1.3 while for young smokers it is -0.4 . A tax on cigarettes would lead to which of the following effects?

13

A shortage of textbooks will cause

14

If a firm is experiencing economies of scale, then as the firm's output rises, its average total cost ________.

15

Employing a general-equilibrium approach, describe the effect of a new law that prohibits steel imports

16

Consider a Stackelberg duopoly with the following inverse demand function: P = 100 − 2Q1 − 2Q2. The firms' marginal costs are identical and are given by MCi = 2. Based on this information, the Stackelberg leader's reaction function is:

17

External costs occur when people litter.

18

If the demand for computers increases as consumers' incomes rise, then computers are:

19

College graduation rates and college attendance rates are equally strongly correlated with family income

20

The establishment of a government redistributive program such as price supports creates _____

21

In the short run, a firm that is incurring losses would always be better off if it keeps producing.

22

Explain why risk can be insured against but uncertainty cannot

23

When plotting log wages (y-axis) against years of schooling (x-axis), the slope of the regression line indicates

24

Assuming an interior solution, a production plan is profit maximizing if and only if all marginal revenue products are equal to input prices.

25

Suppose Island Bikes, a profit-maximizing firm, is the only bike rental company in a small resort town. The marginal cost to Island Bikes of renting out a bike is $3, and Island Bikes has no fixed costs. Each day Island Bikes has six potential customers, whose reservations prices are listed in the table. CustomerReservation Price($/Rental)A22B16C12D8E6F4Suppose Island Bikes knows that customers whose reservation prices are at least $10 always rent bikes before noon, while those whose reservation prices are below $10 never do so. If Island bikes can charge a different price in the morning and in the afternoon, then in the afternoon, it will rent out ________ bike(s) and charge ________ per bike.

26

If the average tax rate is less than the marginal tax rate, the tax would be

27

The slope of an indifference curve is ____ and a movement along the curve causes the loss in marginal utility (MU) of one good to ____ the marginal utility (MU) gained from another good

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Quiz Step by Step 2. Economics - Microeconomics

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