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Econ Unit III
Econ Unit III
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College prep highschool microeconomics quiz review
Flashcards
35 cards
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Questions
35
Answers
1
Which best sums-up the Law of Diminshing Marginal Returns?
Each extra cookie tastes worse than the last
Too many cooks spoil the broth
You can't have everything you want
There's no such thing as a free lunch
2
What are Antitrust laws generally intended to do?
Preserve competition
Protect against foreign businesses
Ensure safety
Prevent pollution
3
What is a
disadvantage
of sole-proprietorships?
Limited Liability
Limited ability to raise funds
Difficult to set-up
Complicated decision making
4
What determines wages?
The Government
Employers
the Labor Market
the Human Resources Dept.
5
When will a firm
decrease
production?
When MR > MC
When TR = TC
When FC < VC
When MC > MR
6
What is the function of the National Labor Relations Board?
To set wage rates.
To ensure labor strikes are conducted peacefully.
to ensure employees are paid.
To investigate unfair labor practices.
7
Who are the owners of a corporation?
The General Partners
The Stockholders
The Government
The Board of Directors
8
How is the demand for workers an example of a derived demand?
because it is derived from the government.
because it is derived from the labor market.
because it is derived from the wage rate.
because it is derived from the demand for the goods workers make
9
Which of the following is a private good?
an invitation-only concert
a parking spot
a song
a barbeque
10
How do labor unions attempt to affect the labor market?
They try to increase the supply of labor.
They try to decrease the demand for labor.
They try to decrease the supply of labor.
They try to decrease the demand for union-produced goods.
11
Which is NOT a feature of Perfect Competition?
Many buyers and sellers
Identical Products
low barriers to entry
Price searcher
12
A market structure with few sellers, high barriers to entry, and slightly differentiated goods?
Perfect Competition
Monopolistic-competitive
Monopoly
Oligopoly
13
What is a "union shop"?
organization that requires employees to join the union
organization that seeks more pay and benefits for members
organizations where joining the union is not required
organizations that hire only union members
14
What is a laborer's "real" wage?
the nominal wage
the measure of a wage rate in terms of what it buys
the measure of a person's wage rate in terms of its purchasing power
(Money wage) / the CPI
15
What are fixed costs added to variable costs called?
Average Total Cost
Marginal Cost
Opportunity Cost
Total Cost
16
What is a market structure with many sellers, identical goods, and low barriers to entry?
Oligopoly
Monopoly
Monopolistic-Competitive
Perfect Competition
17
What is it called when firms in an oligopoly agree to fix prices or output?
conglomerate
monopoly
cartel
trust
18
What is the price of labor in the labor market?
the wage rate
income
dollars per hour
minimum wage
19
What will happen when the Quantity-supplied of labor > the Quantity-demanded of labor?
the wage rate will rise
the wage rate will fall
the Demand for labor will rise
the Supply for labor will rise
20
Which is NOT a feature of a Monopolistic-Competitive market structure?
Price Searcher
Identical Goods
Low Barriers to Entry
Produce at MR=MC
21
What is a public good?
A good where one's use does not take away another's
A good owned by the government
A good that can be shared
A good owned by the public
22
Why does the government produce non-excludable public goods?
Because private business can't make a profit on them
So it can raise taxes
Because it can
So it make a profit
23
What does a firm consider before increasing production?
fixed and variable costs
positive and negative externalities
dollars and sense
marginal revenues and marginal costs
24
What kind of market exists when the government permits
only one
firm to provide the good or service?
Perfectly Competitive
Public Franchise
Monopoly
Oligopoly
25
Which firm's owner benefits from limited liability?
Franchise
Sole-proprietorship
Corporation
Partnership
26
Which is an example of a legal monopoly?
Nike
Google
Chevron
PG&E
27
Why are bosses necessary?
To reduce shirking
To handle the money
To talk to customers
To assign work
28
Charging different prices to similar customers, when the price difference is not based on cost?
Price Interdependence
Price Discrimination
Price Leadership
Price Competition
29
How is Total Revenue calculated?
MC = MR
TR - TC
P x Q
ATC x Q
30
What is a good that has high rivalvry but low excludability?
Common goods
Neutral Goods
Public Goods
Private goods
31
What is an example of a variable cost?
License fee
Wages
Rent
Mortgage
32
What is the major goal of every firm?
To maximize production
To beat the competition
To maximize profits
To reduce taxes
33
What is an adverse side effect of an act that is felt by others?
Freerider
Unintended consequence
Marginal Cost
Negative Externality
34
What are persons who receive the benefits of a good without contributing to its cost?
Shirkers
Residual claimants
Freeriders
Negative externalities
35
What is the additional cost of producing one more unit of output?
Average Total Cost
Variable Cost
Marginal Cost
Marginal Revenue
