The compensation variation and equivalent variation will be closer to each other when A) the income elasticity is greater. B) the budget share is greater. C) the price change is smaller. D) the income elasticity is smaller. ANSWER D
Date: September 9th, 2020
The t-test is a statistical measure which A) tests the true value of a variable. B) tests the statistical significance of a regression coefficient. C) tests the statistical significance of a regression equation. D) None of the above ANSWER B
Date: September 9th, 2020
Suppose a firm acts to minimize the cost of producing 500 units of output and determines this cost to be $25,000. Then, if the firm acts to maximize output for a total cost of $25,000, the maximum output attainable is A) 500. B) less than 500. C) more than 500. D) unknown. ANSWER A […]
Date: September 9th, 2020
For a profit maximizing monopolist, if the MC = 10 and price is set to be 20, then the elasticity at this price is A) -2. B) -1. C) -0.5. D) 0. ANSWER A
Date: September 9th, 2020
Supply chain management refers to A) the contracts put in place to manage a firm’s suppliers. B) the decisions around which stages of production to handle internally and which to buy from others. C) how the firm compensates the employees who work on the firm’s internal stages of production. D) the 19th century practice of […]
Date: September 9th, 2020
Which of the following factors has negatively impacted the viability of the pay-as-you-go Social Security system? a. Each generation is living longer and thus collecting more benefits. b. The “baby boom” after WWII greatly increases the number of retirees in the first few decades of this century. c. Individuals are having fewer children today. d. […]
Date: September 9th, 2020
Porter’s “Five Forces Model” is based on A) the laws of supply and demand. B) the law of diminishing returns. C) the Structure-Conduct-Performance model. D) the key factors affecting demand. ANSWER C
Date: September 9th, 2020
If a monopolist faces entry by a potential rival, investing to lower its marginal cost A) is a credible way to deter entry. B) is not a credible threat. C) is credible but will not deter entry. D) will not occur, even when there are no barriers to entry. ANSWER A
Date: September 9th, 2020
The three models of oligopolies, Cournot, Stackelberg and Bertrand, all assume firms independently choose the quantity of output to produce. Indicate whether the statement is true or false ANSWER False. While the Cournot and Stackelberg models assume quantity choice as the action, in the Bertrand model, firms choose price.
Date: September 9th, 2020
A firm that backward vertically integrates A) moves downstream in the production process. B) requires that the production process be relatively simple. C) has to merge with another firm. D) may be producing its own inputs. ANSWER D
Date: September 9th, 2020
