Microeconomics

Economics

NewSchool of Architecture and Design

Question Description

4 chapters, each chapter has 20 questions

all questions are Multiple choice

I need guaranteed answers so please if you think you can't do it then don't bid

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Name: __________________________ Date: _____________ Use the following to answer question 1: Figure: The Market for Roses 1. (Figure: The Market for Roses) Look at the figure The Market for Roses. In the figure, producer surplus without international trade would be area or areas: A) X + Y + Z. B) W + X + Y. C) X + Y. D) Y. 2. If the United States removed the tariffs and quotas on sugar, then: A) consumer surplus would not change. B) consumer surplus would decrease. C) total surplus would decrease. D) producer surplus would decrease. 3. France and England both produce wine and clothing under conditions of constant opportunity costs. France will have a comparative advantage in wine production if: A) it can produce more wine than England. B) its labor productivity in wine production is greater than England's. C) the absolute cost of producing wine is lower in France than in England. D) the opportunity cost of wine production is lower in France than in England. Page 1 Use the following to answer question 4: Figure: The Market for Melons in Russia 4. (Figure: The Markets for Melons in Russia) Look at the figure The Market for Melons in Russia. Suppose the world price of melons is D. Russia will: A) import H – I of melons. B) export H – I of melons. C) import F – G of melons. D) export F – G of melons. Use the following to answer question 5: Figure: The Market for Oranges in South Africa Page 2 5. (Figure: The Market for Oranges in South Africa) Look at the figure The Market for Oranges in South Africa. In autarky, the price of oranges in South Africa is P1. When the economy is opened to trade, the price falls to PW and producer surplus will ________ to ________. A) fall; N + Q B) fall; Q C) rise; M + N + O + P D) rise; M + N + O + P + Q Use the following to answer question 6: Figure: The Production Possibilities for Two Countries 6. (Figure: The Production Possibilities for Two Countries) Look at the figure The Production Possibilities for Two Countries. If Indonesia and Malaysia trade 1 radio for 1 tire, the most that Indonesia can consume is ________ radios and ________ tires, while the most that Malaysia can consume is ________ radios and ________ tires. A) 300; 600; 800; 200 B) 200; 900; 600; 300 C) 1,200; 400; 800; 200 D) 600; 600; 1,000; 600 Page 3 Use the following to answer question 7: 7. (Table: The Production Possibilities for Tractors and Crude Oil) Look at the table The Production Possibilities for Tractors and Crude Oil. The opportunity cost in the United States of producing 30 (thousand) barrels of crude oil is ________ tractors. A) 60 B) 80 C) 100 D) 120 8. If labor is abundant in South Africa but capital is scarce, when South Africa opens to trade: A) the prices of labor and capital will rise. B) the prices of labor and capital will fall. C) the price of labor will rise and the price of capital will fall. D) the price of labor will fall and the price of capital will rise. 9. The use of comparative advantage in international trade: A) is used only by larger countries. B) benefits all countries involved in trade. C) provides benefits to developed countries only. D) does not determine what goods countries should produce. 10. Assume that the United States imposes a quota on Italian shoes. Relative to the equilibrium world price that would exist in the absence of quotas, the equilibrium price of shoes in the United States will most likely ________, and the equilibrium price of shoes in Italy will most likely ________. A) increase; decrease B) decrease; remain the same C) decrease; increase D) increase; remain the same Page 4 Use the following to answer question 11: Figure: The Gains from International Trade 11. (Figure: The Gains from International Trade) Look at the figure The Gains from International Trade. In the figure, each country must trade ________ to consume at combination C. A) 1 computer for 1/2 box of roses B) 2 computers for 1 box of roses C) 1/2 computer for 1 box of roses D) 1 computer for 1 box of roses Page 5 Use the following to answer question 12: Figure: The Market for Tea in Sri Lanka 12. (Figure: The Market for Tea in Sri Lanka) Look at the figure The Market for Tea in Sri Lanka. In autarky, the price of tea in Sri Lanka is P1. When the economy is opened to trade, the price rises to PW. Sri Lanka will ________ tea and the volume of trade will equal ________. A) import; QT – CT B) export; QT – CT C) import; Q1 – QT D) export; CT – Q1 Use the following to answer question 13: Figure: The Market for Laptop Sleeves Page 6 13. (Figure: The Market for Laptop Sleeves) Look at the figure The Market for Laptop Sleeves. Identify the area or areas of government tax revenue when a tariff raises the domestic price from the world price to P1. A) D + E + F B) D + F C) E D) B 14. The United States places a tariff on imported Brazilian ethanol. The impact of this tariff on the domestic ethanol market is a ________ domestic price, ________ consumer surplus, and ________ producer surplus. A) higher; less; more B) lower; less; more C) higher; more; less D) higher; less; less Use the following to answer question 15: Figure: The Market for Computers 15. (Figure: The Market for Computers) Look at the figure The Market for Computers. In the figure, consumer surplus without international trade would be area or areas: A) W + X + Y. B) W. C) Y. D) W + X. Page 7 16. Tariffs and import quotas always: A) increase the quantity of imports as compared to free trade. B) generate government revenue. C) increase consumer surplus as compared to free trade. D) reduce total surplus as compared to free trade. 17. Compared with autarky, international trade leads to ________ production in exporting industries and ________ production in import-competing industries. A) higher; lower B) higher; higher C) lower; higher D) lower; lower Use the following to answer question 18: Scenario: The Production of Wheat and Toys Below is information regarding the production of two goods, wheat and toys, in country A and country B. Each country has a linear production possibility frontier with respect to its production of the two goods. The numbers in each column represent the total number of units each country could produce if it used all of its resources to produce the good. 18. (Scenario: Production of Wheat and Toys) Look at the information provided above. The opportunity cost of producing a unit of toys in country A is: A) 1/2 unit of wheat. B) 1 unit of wheat. C) 50 units of wheat. D) 100 units of wheat. Page 8 Use the following to answer question 19: Figure: The Market for Calculators 19. (Figure: The Market for Calculators) Look at the figure The Market for Calculators. The world price, PW, equals $100. When the economy moves from autarky to free trade, consumer surplus rises by area ________ and producer surplus falls by ________. A) B + K + L; B B) B + C + K + L; B + C + K + L C) B + C+ H + I + K + L; B + C + H + I D) B + C + G + H + I + J + K + L; B + C Use the following to answer question 20: Figure: A Tariff on Oranges in South Africa Page 9 20. (Figure: A Tariff on Oranges in South Africa) Look at the figure A Tariff on Oranges in South Africa. When the government imposes a tariff on imported oranges, the price of oranges in South Africa rises from PW to PT and the volume of imports falls to: A) Q2 – Q1. B) C1 – C2. C) C1 – Q1. D) C2 – Q2. Page 10 Chapter 07 Name: __________________________ Date: _____________ 1. Suppose the government imposes a $10 per month tax on cell phone service. If the demand curve for cell phone service is perfectly inelastic and the supply curve is upward sloping, the price that consumers each month pay for cell phone service will increase by: A) $5. B) less than $10. C) $10. D) $0. Use the following to answer question 2: Figure: The Market for Blue Jeans 2. (Figure: The Market for Blue Jeans) Look at the figure The Market for Blue Jeans. The government recently levied a $10 tax on the producers of blue jeans. What area or areas in the graph identify deadweight loss? A) a + b + c B) b + d C) c + e D) d + e + f Page 1 Use the following to answer question 3: Figure: The Market for Yachts 3. (Figure: The Market for Yachts) Look at the figure The Market for Yachts. If the government imposes a $30,000 tax on yachts and collects it from the yacht suppliers, the ________ curve will shift ________ by ________. A) demand; downward; $15,000 B) supply; upward; $15,000 C) supply; upward; $30,000 D) demand; downward; $30,000 4. An excise tax that the government collects from the producers of a good: A) shifts the supply curve upward. B) causes a loss of revenue for the government. C) has a similar effect as a tax subsidy. D) shifts the supply curve downward. Page 2 Use the following to answer question 5: Figure: The Gasoline Market 5. (Figure: The Gasoline Market) Look at the figure The Gasoline Market. An excise tax has been levied on each gallon of gasoline, shifting the supply curve upward. The deadweight loss from this tax is equal to: A) $1.50. B) $5,000. C) $15,000. D) $4,375. 6. If the government imposes a $5 excise tax on leather shoes and the price of leather shoes increases by $2: A) the government will receive less tax revenue than anticipated. B) consumers are paying more of the tax than the producers. C) producers are paying more of the tax than are the consumers. D) the quantity of shoes sold will increase. Page 3 Use the following to answer question 7: Figure: Tax Incidence 7. (Figure: Tax Incidence) Look at the figure Tax Incidence. All other things unchanged, the effect of an excise tax imposed on gasoline in the long run is most likely illustrated by panel ________, and the greater share of the burden of the excise tax (shown by the tax wedge in each panel) is borne by ________. A) A; buyers B) B; sellers C) B; buyers D) A; sellers Use the following to answer question 8: Scenario: The Market for Good X: The market for good X can be depicted with the following demand and supply equations: Demand: P = 50 – 1/2Q Supply: P = 1/3Q where P is price per unit and Q represents quantity in units. Policy makers plan on imposing a $1 per unit tax on this good. Page 4 8. (Scenario: The Market for Good X) Look at the scenario The Market for Good X. The tax revenue collected by government from a $1 per unit tax will be: A) $1.00. B) $58.80. C) $60.00. D) $60.50. 9. Paying a tax of $10 on an income of $100, a tax of $25 on an income of $200, and a tax of $60 on an income of $300 is an example of a: A) progressive tax. B) proportional tax. C) regressive tax. D) flat tax. Use the following to answer question 10: Figure: The Market for Yachts 10. (Figure: The Market for Yachts) Look at the figure The Market for Yachts. If the government imposes a $60,000 tax on yachts (collected from the producers), consumers will pay ________ of the tax and producers will pay ________. A) $30,000; $30,000 B) $40,000; $20,000 C) $20,000; $40,000 D) $10,000; $50,000 Page 5 11. Which of the following situations provides an example of the benefits principle? A) Employed workers pay taxes that are used to fund technical training programs. B) Revenue from the federal tax on gasoline is used to maintain and improve the interstate highway system. C) Most of the revenue from property taxes is used to fund public schools. The taxes are paid by all homeowners. D) Taxes on cigarettes are used to pay state employees' salaries. 12. Paying a tax of $20 on an income of $200, a tax of $40 on an income of $400, and a tax of $50 on an income of $500 is an example of: A) a regressive tax. B) a proportional tax. C) a progressive tax. D) an inverse tax. 13. In analyzing the impact of a progressive tax system, economists focus on the ________ tax rate. A) average B) opportunity C) total D) marginal 14. Because of tax competition, state and local taxes tend to be ________ and federal taxes tend to be ________. A) regressive; regressive B) progressive; regressive C) progressive; progressive D) regressive; progressive Page 6 Use the following to answer question 15: Figure: Tax Incidence 15. (Figure: Tax Incidence) Look at the figure Tax Incidence. All other things unchanged, when a good or service is characterized by a relatively inelastic supply, as shown in panel ________, a greater share of the burden of an excise tax is borne by ________. A) A; buyers B) B; sellers C) A; sellers D) B; buyers 16. An excise tax causes inefficiency because the number of transactions in a market is reduced. Because the tax discourages mutually beneficial transactions, there is a(n)________ from a tax. A) quota rent B) deadweight loss C) increased consumer surplus D) increased producer surplus 17. Some highways and bridges require drivers to pay a toll to use that infrastructure. Which principle of tax fairness does this describe? Page 7 18. Which of the following statements about the effects of an excise tax is incorrect? A) The lower the elasticity of supply relative to the elasticity of demand, the lower the burden of the tax borne by suppliers. B) An excise tax causes a deadweight loss because consumer and producer surpluses are reduced by more than the revenue the government collects. C) An excise tax drives a wedge between the price paid by consumers and the price received by producers. D) An excise tax is inefficient because it distorts incentives at the margin for both consumers and producers. 19. Which of the following best describes a regressive tax? A) A tax that takes a higher percentage of income as income rises. B) A tax whose rate rises less than in proportion to income. C) A tax that takes a fixed percentage of income regardless of the taxpayer's level of income. D) A tax that takes a larger share of the income of high-income taxpayers than of low-income taxpayers. 20. The two most important sources of federal tax revenue are the: A) payroll and income taxes. B) corporate income and payroll taxes. C) excise and income taxes. D) Social Security and excise taxes. Page 8 Chapter 06 Name: __________________________ Date: _____________ 1. If a good has a price inelastic demand, then which of the following is not likely to be characteristic of this good? A) The good is a necessity and is relatively unimportant in the household budget. B) There are many substitutes for the good. C) Consumers spend a small percentage of their income on the good. D) Consumers do not have much time to adjust to market changes. 2. If the income elasticity of demand for a good is negative, the good is said to be: A) an inferior good. B) a negative good. C) a positive good. D) a normal good. 3. Assume that as your income increases, your consumption of burgers increases. We can assume that you consider burgers: A) a negative good. B) a positive good. C) an inferior good. D) a normal good. 4. If a good is very inexpensive, but it is a necessity, you would predict that demand for the good is: A) is price-elastic. B) is price-inelastic. C) is price unit-elastic. D) has indeterminable price elasticity. 5. Since the price of walnuts increases as the demand for cashews increases, we can assume that these two goods are: A) unrelated goods. B) superior goods. C) inferior goods. D) substitute goods. Page 1 Use the following to answer question 6: Figure: Supply Curves 6. (Figure: Supply Curves) Look at the figure Supply Curves. Which graph shows a perfectly inelastic supply curve? A) A B) B C) C D) D 7. Which of the following statements is true? A) When the income elasticity of demand is positive, the good is an inferior good. B) When the income elasticity of demand is negative, the good is a normal good. C) Income elasticity of demand measures how much the demand for a good is affected by changes in consumers' incomes. D) Income elasticity of demand measures the effect of the change in one good's price on the quantity demanded of the other good. 8. If the price of emergency visits to the doctor were to rise, we would expect: A) a significant decline in the number of emergency visits to the doctor. B) only a slight decline in the number of emergency visits to the doctor. C) the number of emergency visits to the doctor to increase. D) the total income of doctors to fall dramatically. Page 2 Use the following to answer question 9: Figure: The Demand Curve 9. (Figure: The Demand Curve) If the price is $8, total revenue is ________ . If the price is $7, total revenue is ________. A) $24; $16 B) $14; $21 C) $16; $21 D) $10; $10 10. If your purchases of shoes decrease from 11 pairs per year to 9 pairs per year when your income increases from $19,000 to $21,000 a year, other things equal, then, for you, shoes are considered: A) a normal good. B) an inferior good. C) a complementary good. D) a substitute good. 11. When the price of chocolate-covered peanuts increases from $1.55 to $2.00, the quantity demanded decreases from 220 to 160. In this price range, the demand for chocolate covered peanuts is _________ and total revenue will __________ when the price increases. A) elastic; increase B) elastic; decrease C) inelastic; increase D) inelastic; decrease Page 3 12. We note that the price of pretzels increases and the demand for tortilla chips decreases, so we can assume that these two goods are: A) unrelated goods. B) inferior goods. C) complementary goods. D) substitute goods. 13. The demand for strawberry ice cream tends to be relatively price-elastic because: A) for most people there are many close substitutes for strawberry ice cream. B) it is a necessity for most people. C) it has to be consumed very quickly. D) it costs so little. 14. If the price of chocolate-covered peanuts decreases from $1.05 to $0.95 and the quantity demanded increases from 180 bags to 220 bags, then the price elasticity of demand (using the midpoint method) is: A) 0.5. B) 1. C) 2. D) greater than 2. 15. The price of notebooks is $5, and at that price consumers demand 12 notebooks. If the price rises to $7, consumers will decrease consumption to 4 notebooks. Using the midpoint formula, what is the price elasticity of demand for notebooks? A) 1/3 B) 3 C) 1/6 D) 6 16. If your purchases of shoes increase from 9 pairs per year to 11 pairs per year when the price of shirts increases from $8 to $12, for you, shoes and shirts are considered: A) inferior goods. B) luxury goods. C) substitute goods. D) complementary goods. Page 4 17. A newspaper typically consumes a smaller fraction of a consumer's budget than a home entertainment system. Therefore, you would expect the demand for: A) a home entertainment system to be more price-elastic. B) a home entertainment system to be more price-inelastic. C) newspapers to be more price-elastic. D) the two to be equally price-elastic. 18. Using the midpoint method to calculate the price elasticity of demand eliminates the problem of computing: A) different elasticities, depending on whether price decreases or increases. B) different elasticities, because price and quantity are inversely related on the demand curve. C) total revenue when price falls and demand is inelastic. D) total revenue when price falls and demand is elastic. Use the following to answer question 19: 19. (Table: Prices, Quantity Demanded, and Income for Jeremy) Look at the table Prices, Quantity Demanded, and Income for Jeremy. Between the two years listed, Jeremy's income elasticity of demand for coffee equals ________ and donuts are a(n) ________ good. A) 0.20; inferior good B) 2; normal good C) 2; inferior good D) 0.20; normal good 20. A good is likely to have an inelastic demand curve if: A) the consumer has significant time to respond to the price change. B) the good has few available substitutes. C) the good is a luxury. D) the good accounts for a large share of consumer income. Page 5 Name: __________________________ Date: _____________ Use the following to answer questi ...
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