FREE BUSINESS AND STUDY GAMES ABOUT MICRO EXAM

PDF Download

FREE BUSINESS AND STUDY GAMES ABOUT MICRO EXAM

2 Actual Qs and Ans Expert-Verified Explanation

This Exam contains:

-Guarantee passing score -88 Questions and Answers -format set of multiple-choice -Expert-Verified Explanation Question 1: Farmers face a short-run good/bad paradox because the:

Answer:

demand curve for their products is relatively inelastic.Question 2: The rule for employing a profit-maximizing amount of labor is to continue to hire additional workers as long as the additional worker's value of marginal product is

Answer:

equal to the wage rate.Question 3: When a nation starts importing a good or service, domestic employment in that industry

Answer:

decreases.Question 4: A leftward shift in the supply of agricultural output will most likely cause

agricultural prices to:

Answer:

rise proportionately more than the decline in quantity demanded.

Question 5: In the labor market,

Answer:

firms demand labor.Question 6: Of the four options for supporting farm prices, the one that harms taxpayers the

LEAST is:

Answer:

regulation.Question 7: Most t-shirts bought by Americans are made in Asia. U.S. consumers of t-shirts win from trade with Asia by paying ___ price than they would pay if t-shirts were produced in the United States.

Answer:

a lower.Question 8: The fed govt pays airlines 2 service small cities in the US thru a subsidy prog called Essential Air Service which was estab in 78 when the airline indust was deregulated. Most subsidies cant exceed $200 per passenger. What isnt an effect of this subsidy?

Answer:

An increase in price and an increase in quantity produced.Question 9: If the world price of a good is below the no-trade domestic price, a counrtry

Answer:

will benefit from importing the good.

Question 10: After a tariff is imposed, consumers must pay

Answer:

the world market price plus the tariff.

Question 11: When a product is taxed,

Answer:

(a.)part of the initial consumer surplus becomes a dead weight loss.(b.)part of the initial consumer surplus goes to the government as revenue.

Both answers a and b are correct.

Question 12: Which of the following is a way of controlling the quantity of a particular product?

Answer:

business licenses.Question 13: The fed govt pays airlines to service small cities in the US through a subsidy prog called Essential Air Service which was estab in 1978 when the airline industry was deregulated.Most subsidies cant exceed $200 per passenger. W/o this subsidy, what is T?

Answer:

There would be higher prices and fewer flights.

Question 14: The law of decreasing returns states that as a firm uses more of a

Answer:

variable input, with a given quantity of fixed inputs, the marginal product of the variable input eventually decreases.Question 15: Goods and services that the United States buys from other nations are called

Answer:

imports.Question 16: A maximum price set below the equilibrium price will:

Answer:

cause excess demand and decrease total surplus.

Question 17: The demand curve for labor is the same as the firm's

Answer:

value of marginal product curve.Question 18: As a result of the proliferation of ATM machines, the demand for bank tellers has

Answer:

decreased.Question 19: Since rent control ___ the total surplus of the market, the policy generates a ____.

Answer:

decreases; dead weight loss.

Question 20: The purpose of government's land bank program is to:

Answer:

support prices by giving farmers economic incentives to reduce supply.

Question 21: The excess burden of a tax refers to the fact that

Answer:

the dead weight loss created by the tax exceeds the tax revenue.

Question 22: The demand for a resource is derived from the

Answer:

demand for the good or service that the resource is used to produce.

Question 23: A tax

Answer:

(a.) places a wedge between the price paid by the buyers and the price received by the sellers.(b.) reduces consumer and producer surplus.

Both answers a and b are correct.

Question 24: Which of the following represents a derived demand? Demand for..

Answer:

a grocery clerk by the local Safeway.Question 25: The Demand curve for pizza is downward sloping and the supply curve is upward sloping. If the government imposes a $2 tax on a pizza, ____ pay the tax.

Answer:

Both producers and consumers.Question 26: A specified maximum amount of the good that may be imported in a given period of time is a

Answer:

quota.