Question : 11) If the price of milk was $1.25 a gallon : 1388101

 

 

11) If the price of milk was $1.25 a gallon and it is now $2.25 a gallon, what is the percentage change in price?

A) 4.4 percent

B) 8 percent

C) 44 percent

D) 80 percent

 

12) If the price of pineapple juice was $4.50 a gallon and it is now $5.75 a gallon, what is the percentage change in price?

A) 7.8 percent

B) 12.5 percent

C) 27.7 percent

D) 57.5 percent

 

 

13) At a recent company meeting, Geraldine Erwin, sales manager of Dastoria, a flavored beverage producer announced, “We have increased our sales by 8 percent in just six months.” Suppose six months ago, its sales amounted to $452,000, what is the value of its sales today?

A) $36,160

B) $415,840

C) $488,160

D) $565,000

 

Figure 1-1

 

 

14) Refer to Figure 1-1.  Using the information in the figure above, calculate the percentage change in sales of alcoholic beverages between 2008 and 2010.

A) 23.8%

B) 40%

C) 42.9%

D) 73.3%

 

Figure 1-2

 

15) Refer to Figure 1-2. Calculate the area of the triangle A.

A) $8.4 million

B) $6.3 million

C) $3.15 million

D) $2.1 million

 

Figure 1-3

 

 

16) Refer to Figure 1-3. Calculate the area of the trapezoid X.

A) $361

B) $450

C) $1,020

D) $1,140

 

Figure 1-4

 

 

17) Refer to Figure 1-4. Which of the following statements is true?

A) The slope of the tangent at E is positive and the slope of the tangent at F is negative.

B) The slope of the tangent at E is negative and the slope of the tangent at F is positive.

C) The slope of the tangent at E and the slope of the tangent at F are negative.

D) The slope of the tangent at E and the slope of the tangent at F are positive.

 

 

18) An “omitted variable” is

A) a variable which is purposely omitted from an economic analysis.

B) a variable which is inadvertently omitted from an economic analysis.

C) a variable that has no impact on other variables in an economic analysis.

D) a variable that affects other variables and its omission from economic analysis can lead to false conclusions about cause and effect.

 

19) What is the “reverse causality” problem in determining cause and effect?

A) It is a problem that occurs when one concludes that a change in variable X caused a change in variable Y when in actual fact, it is a change in variable Z that caused a change in variable Y.

B) It is a problem that occurs when one observes that a change in variable X caused a change in variable Y which caused a change in variable Z and concludes that a change in variable X caused a change in variable Z.

C) It is a problem that occurs when one concludes that a change in variable X caused a change in variable Y when in actual fact, it is a change in variable Y that caused a change in variable X.

D) It is a problem that arises when two variables are inter-connected so that a change in variable X causes a change in variable Y, and a change in variable Y causes a change in variable X.

 

 

20) The number of people who have gray hair is very high among residents living in Florida. A student concludes that living in Florida causes hair to turn gray. What is the flaw in this student’s reasoning?

A) The student is drawing a false conclusion by making the mistake of omitting critical variables such as the age and gender of the residents.

B) The student is using an inadequate sample size.

C) The student is drawing a false conclusion; he is confusing cause and effect.

D) The student has failed to take into account other causes of gray hair.

 

 

21) You explain to your friend Haslina, who runs a catering service called “Meals in a Zip,” about an economic theory which asserts that consumers will purchase less of a product at higher prices than they will at lower prices.  She contends that the theory is incorrect because over the past two years she has raised the price of her catered meals and yet has seen a brisk increase in sales. How would you respond to Haslina?

A) Haslina is right; she has evidence to back her claim. The theory must be erroneous.

B) I will explain to her that she is making the error of reverse causality: it is the increase in demand that has enabled her to raise her prices.

C) I will explain to her that there are some omitted variables that have contributed to an increase in her sales such as changes in income.

D) Haslina is making the mistake of assuming that correlation implies causation.

 

 

Table 1-4

 

Year

Flat-Panel TV Sets (millions)

2007

  1.0

2008

   1.5

2009

  7.3

2010

12.7

2011

20.0

 

22) Refer to Table 1-4.  The table above shows the sales of flat-panel television sets in Central America. Present the information using a bar graph.