一、TrueorFalse1.AccordingtotheLawofComparativeAdvantage,individualsandeconomiesshouldspecializeinproducingthosegoodsandservicesinwhichtheyhaveacomparativeadvantage.()2.IfMUx/PxislessthanMUy/Py,thenautility-maximizingconsumertheconsumershouldconsumemoreXandlessY.()3.Iftherearetwogoodswithpositivepricesandthepriceofonegoodisreduced,whileincomeandotherpricesremainconstant,thenthesizeofthebudgetsetisreduced.()4.Justasinthetheoryofutilitymaximizingconsumers,thetheoryofprofitmaximizingfirmsallowsthepossibilityof"Giffenfactors".Thesearefactorsforwhichafallinpriceleadstoafallindemand.()5.Ifthevalueofthemarginalrevenueproduct(MRP)oflaborexceedsthewagerate,thenacompetitive,profit-maximizingfirmwouldwanttohiremorelabor.()6.Iftheamountofmoneythatpeoplearewillingtospendonagoodstaysthesamewhenitspricedoubles,thendemandforthatgoodmusthaveapriceelasticityofdemandsmallerinabsolutevaluethanone.()7.Iftheequationforthedemandcurveisq=40-2p;thenmarginalrevenuedecreasesinthequantitydemanded.()8.Producer'ssurplusatpricepistheverticaldistancebetweenthesupplycurveandthedemandcurveatpricep.()9.Thosewhowanttousehighercigarettetaxesasameansofreducingsmokingwouldpreferthedemandcurveforcigarettestobehighlyelastic.()10.Afirmisexperiencingeconomiesofscalemeansthatthepercentincreaseinoutputisgreaterthanpercentincreaseininputs,andhence,thelongrunaveragecostofproductionisstable.()二、MultipleChoice1.Economicsisthestudyofa.scarcityundertheconditionsofdemocracyb.choicewithinasystemofcapitalismc.theroleofgovernmentinamarketsystemd.choiceunderconditionsofscarcity2.Opportunitycostsexistbecausea.thereisapriceattachedtovirtuallyeverygoodorserviceb.technologyisnotfixedintheeconomyc.peoplehavedifferenttastesandpreferencesd.limitedresourcescannotsatisfyallofthewantsinsociety3.Alongaproductionpossibilitiesfrontiera.moreofonegoodcanbeproducedwithoutgivingupsomeoftheothergoodb.resourcesarenotbeingfullyutilizedc.availableresourcesarebeingusedefficientlyd.thereisproductiveinefficiency4.Youhaveabondthatyoucanredeemfor$10,000inthenextyear.Theinterestrateis10%peryear.Howmuchisthebondworthtoday?a.$9,090.91b.$10,000.00c.$8,264.46d.$9,523.815.WhichofthefollowingwouldNOTcausethedemandcurveforcollegefootballticketstoshift?a.anincreaseinthepriceofprofessionalfootballticketsb.adecreaseinthepriceofcollegebasketballticketsc.anincreaseinthepriceofcollegefootballticketsd.anincreaseinstudentpreferencesforcollegefootballtickets6.Apriceflooroncornwouldhavetheeffectofa.creatingasurplusregardlessofwherethepricefloorissetb.creatingasurplusifthepricelevelissetabovetheequilibriumpricec.creatingashortagewhenthepricefloorissetbelowtheequilibriumpriced.creatingashortageregardlessofwherethepricefloorisset7.Alongaperfectlyelasticsupplycurvea.thequantitysuppliedisalwaysthesameb.thepriceelasticityofdemandisalwaysthesamec.thepriceisalwaysthesamed.thecross-priceelasticityofdemandisalwaysthesame8.Theincomeeffectmeasureshowa.thequantityofagoodsuppliedchangesinresponsetoachangeinincomeb.thequantityofagoodsuppliedchangesinresponsetoachangeinthepriceofagoodc.howfarthebudgetlineshiftsduetoachangeinincomed.thequantityofagooddemandedchangesinresponsetoachangeinpurchasingpower9.Whichofthefollowingformulasisincorrect?a.AC=AVC+(FC/Q)b.TVC=TC/Qc.TC=FC+VCd.AFC=FC/Q10.Whenthereareimplicitcostsofproduction,a.accountingandeconomicprofitareequalb.explicitcostsofprod...
