31) If entry into a monopolistically competitive industry occurs because of positive profits earned by the existing firms, the A) industry demand curve will shift to the left. B) industry demand curve will shift to the right. C) demand curve for each existing firm will shift to the left. D) demand curve for each existing firm will shift to the right. E) demand curves […]
71) A perfectly competitive firm is producing at the quantity where marginal cost is $6 and average total cost is $4. The price of the good is $5. To maximize its profit, this firm should A) raise its price. B) lower its price. C) increase its output. D) decrease its output. E) increase the price it charges for its product. 72) Suppose that a […]
11) The conditions for a perfectly competitive market include which one of the following? A) Firms behave as price takers. B) Profits are zero in the short run. C) New entrants cannot threaten the position of existing firms. D) Firms can control prices. E) Firms must employ the newest technologies as soon as they are developed. 12) In order to decide the appropriate output […]
11) Refer to Figure 11-4. What is the area that represents the total fixed cost of production? A) 0P1aQa B) P0adP3 C) P1bdP3 D) That information cannot be determined from the graph. 12) Refer to Figure 11-4. What is the area that represents the loss made by the firm? A) the area P0adP3 B) the area P1bcP2 C) the area P0acP2 D) […]
31) Private solutions to the problem of externalities are most likely when A) government actively encourages these solutions. B) transaction costs are low and the number of bargaining parties is small. C) transaction costs are low and the number of bargaining parties is large. D) transaction costs are low and the monetary damages to third parties is high. 32) Assume that air […]
101) An increase in the currency drain ratio A) decreases the quantity of money. B) decreases the monetary base. C) increases banks’ reserves. D) increases banks’ deposits. E) has no effect on the amount of the monetary base or the quantity of money. 102) ________ increases the size of the money multiplier. A) An increase in the currency drain ratio B) An open market […]
11) An individual has 8 hours to spare. He has to divide his time between two activities: reading and writing. Which of the following allocations will exactly satisfy the individual’s budget constraint? A) 3 hours of reading and 4 hours of writing B) 4 hours of reading and 6 hours of writing C) 2 hours of reading and 2 hours of writing D) 5 […]
11) A decrease in investment leads to ________ in aggregate demand and ________ in real GDP. A) an increase; an increase B) an increase; a decrease C) a decrease; an increase D) a decrease; a decrease E) no change; a decrease 12) A deep recession hits the world economy, and real GDP in the rest of the world decreases. In the United States, A) […]
41.Characterize EACH of the three given statements as being TRUE or FALSE and then indicate the collective true-false status of the statements using the choices: (1) Intramolecular alcohol dehydration converts an alcohol to an alkene. (2) An aryl group is an aromatic carbon-ring system from which one hydrogen atom has been removed. (3) Unlike alcohols, phenols are weak acids in solution. a.All three […]
11) A nation has a comparative advantage in a good when it has a A) lower absolute cost of producing the good. B) higher opportunity cost of producing the good. C) lower opportunity cost of producing the good. D) higher absolute cost of producing the good. E) tariff in place protecting the producers of the good. 12) How can a domestic producer determine whether […]
51. Max’s Tire Center CompanySelected data from the financial statements of Max’s Tire Center are provided below.
2012
2011
Net accounts receivable
$ 55,500
$ 43,200
Allowance for bad debts
2,220
1,700
Total assets
462,500
720,000
Cash flow from operations
314,500
316,800
Net sales
370,000
360,000
Cost of goods sold
185,000
190,000
Capital expenditures
50,000
25,000
Refer to the selected data provided for Max’s Tire Center. What is Max’s receivables turnover ratio in 2012? A. The receivables turnover is 7.79 in 2012.B. The receivables turnover is 6.67 in 2012.C. The receivables turnover is 8.56 in 2012.D. The receivables turnover is 7.21 in 2012.
52. Max’s Tire Center CompanySelected data from the financial statements of Max’s Tire Center are provided below.
2012
2011
Net accounts receivable
$ 55,500
$ 43,200
Allowance for bad debts
2,220
1,700
Total assets
462,500
720,000
Cash flow from operations
314,500
316,800
Net sales
370,000
360,000
Cost of goods sold
185,000
190,000
Capital expenditures
50,000
25,000
Refer to the selected data provided for Max’s Tire Center. What is Max’s days-in-receivables ratio in 2012? A. The days-in-receivables ratio is 50.62 in 2012.B. The days-in-receivables ratio is 54.75 in 2012.C. The days-in-receivables ratio is 42.62 in 2012.D. The days-in-receivables ratio is 60.04 in 2012.
53. Max’s Tire Center CompanySelected data from the financial statements of Max’s Tire Center are provided below.
2012
2011
Net accounts receivable
$ 55,500
$ 43,200
Allowance for bad debts
2,220
1,700
Total assets
462,500
720,000
Cash flow from operations
314,500
316,800
Net sales
370,000
360,000
Cost of goods sold
185,000
190,000
Capital expenditures
50,000
25,000
Refer to the selected data provided for Max’s Tire Center. What is Max’s allowance ratio in 2012? A. The allowance ratio is 3.29% in 2012.B. The allowance ratio is 3.85% in 2012.C. The allowance ratio is 4.89% in 2012.D. The allowance ratio is 2.97% in 2012.
54. Receivables turnover ratio measures: A. a company’s ability to collect its accounts receivables.B. a comparison of allowance account to receivables.C. the fair market value of accounts receivable.D. the efficiency of the accounts payable function.
55. The days-in-receivables ratio: A. is an estimate of the length of time the receivables have been outstanding.B. measures the cash discount period for credit sales.C. is net credit sales divided by average receivables.D. is not meaningful and therefore is not used.
56. The party to a promissory note who will pay the interest and principal is called the: A. lender.B. maker of the note.C. payee of the note.D. recipient of the note.
57. How will the payee of the promissory note record the note on its books? A. The promissory note will be recorded as an assetB. The promissory note will be recorded as a liabilityC. The promissory note will be recorded as an equityD. The promissory note will be recorded as an expense
58. The total amount of interest for one year calculated annually on a $18,000 promissory note payable for 3 years at 11% is: A. $1,980.B. $5,940.C. $3,960.D. $990.
59. Nadal CompanyOn October 1, 2012, Nadal Company received a $50,000 promissory note from Borg Company. The annual interest rate is 6%. Principal and interest will be collected in cash at the maturity date of September 30, 2013. Refer to the information provided for Nadal Company. An adjusting entry for Nadal's year end, December 31, 2012 needed to: A. increase interest revenue by $2,250B. increase notes receivable by $750C. increase interest receivable by $750D. increase notes receivable by $2,250
60. Nadal CompanyOn October 1, 2012, Nadal Company received a $50,000 promissory note from Borg Company. The annual interest rate is 6%. Principal and interest will be collected in cash at the maturity date of September 30, 2013. Refer to the information provided for Nadal Company. The effect on Nadal's financial statements on September 30, 2013, is as follows: A. Assets and equity increaseB. No net change in equityC. Assets and liabilities increaseD. No net change in assets
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