11) Under the Clayton Act and its amendments, which of the following activities is illegal if it creates monopoly? i.contracts that require other goods to be bought from the same firm ii.contracts that prevent a buyer from reselling a product outside a specified area iii.becoming a director of a competing firm A) i only B) ii only C) ii and iii D) i and […]

    41) If the money wage rate does not change, a decrease in the price level will ________ the real wage rate and ________ firms’ profit. A) raise; decrease B) raise; increase C) lower; decrease D) lower; increase E) lower; not change   42) The money wage rate is constant when moving along A) only the aggregate supply curve. B) only the aggregate supply […]

    10.3   Social Influences on Decision Making   1) Consider the following factors: a.culture b.religion c.customs d.prices e.income   Which of the factors above are likely to influence the choices consumers make? A) a, d, and e only B) all the factors except b C) all the factors except c D) d and e only E) all the factors listed     2) What […]

  111) Suppose that the cash drain in the banking system increases during holiday periods. As a result, A) the capacity of the banking system to create deposit money is dampened during holiday periods. B) the capacity of the banking system to create deposit money is increased during holiday periods. C) commercial banks decrease their target reserve ratios. D) changes in reserves will result in […]

  11) At all points on a demand curve, the i.consumer’s budget has been allocated to maximize total utility. ii.quantity is the quantity demanded at each price when total utility is maximized. iii.price represents the marginal benefit the consumer gets from an extra unit of a good. A) i only B) ii only C) i and ii D) i and iii E) i, ii, and […]

  191.RefertoScenario10-1.LetQrepresentthenumberofgallonsofgasolineandletPrepresentthepriceofagallonofgasoline.Whichofthefollowingstatementsiscorrect? a.Onepointonthesocial-costcurveis(Q=1,000,P=$0.45). b.Onepointonthesupplycurveis(Q=1,000,P=$3.10). c.Onepointonthedemandcurveis(Q=1,000,P=$3.55). d.Thesociallyoptimalquantityofgasolineislessthan1,000gallons. 192.RefertoScenario10-1.LetQMARKETrepresenttheequilibriumquantityofgasoline,andletQOPTIMUMrepresentthesociallyoptimalquantityofgasoline.Whichofthefollowinginequalitiesiscorrect? a.1,000

  41. Cardinal Inc. purchased an asset costing $25,000. Annual operating cash inflows generated from the asset are expected to be $6,595 each year for five years. No salvage value is expected at the end of the asset’s life. Using time value of money tables, which of the following rates is closest to the internal rate of return on the project? A. 4%B. 26%C. 10%D. 32%   42. Deciding whether or not […]

  131.Which of the following statements is true about the current monetary system?    A. Use of instruments such as the forward market and swaps has decreased since the breakdown of the Bretton Woods system. B. The present monetary system lacks the volatile movements in exchange rates that existed in a fixed exchange rate system. C. The current foreign exchange market works exactly as depicted in the purchasing power […]

  15.1   The Short-Run Phillips Curve 1) If the economy is at full employment, then the unemployment rate A) is greater than the natural unemployment rate. B) is equal to the natural unemployment rate. C) is below the natural unemployment rate. D) can be anywhere on a short-run Phillips curve. E) is equal to zero. 2) The short-run Phillips curve shows A) potential GDP. B) […]

  1.2   The Economic Way of Thinking   1) Rational choice A) is a choice that uses the available resources to best achieve the objective of the person making the choice. B) is always efficient. C) is what you must give up to get what you want. D) is made by comparing different incentives. E) provides the answer to only the “how” question.   2) […]