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(Repeat your answer on Scantron lines 23, 24 and 25.) Choose the best answer. Suppose it is true that because of advances in productivity, farmers now can produce any amount of agricultural goods at a far lower total cost than ever before. But suppose, also, that the demand curve for agricultural goods is almost vertical. Use supply/demand curve analysis to evaluate the following statements, then select the best answer from A) through E) below. [Hint: (total revenue/year) = (price/unit) x (quantity per year)]
1) Total annual revenue earned by farmers will increase, thanks to their increase in productivity. 2) Total agricultural production will remain almost unchanged. 3) Total annual revenue earned by farmers will decrease, thanks to their increase in productivity. 4) Total agricultural production will increase sharply because of the reduction in prices of agricultural goods. 5) Total annual revenue earned by farmers will remain unchanged, thanks to their increase in productivity.
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2. |
The largest percentage of businesses are:
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3. |
(Repeat answer on Scantron lines 26 and 27.) Evaluate the following statements and then choose from A) through E)
1) The Wealth of Nations was written by Milton Freidman. 2) The Wealth of Nations was written by John Maynard Keynes. 3) The Wealth of Nations was published just after the Great Depression. 4) Adam Smith is a famous economist who wrote in the mid 1800's.
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4. |
(Repeat answer on Scantron line 28.) Refer to the graph above. Given the resources and technology available to this economy, it can produce at points:
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5. |
(Repeat answer on Scantron lines 29 and 30.) Suppose the sunk cost of obtaining your college degree is $50,000, the marginal cost is $175,000, and the marginal benefit is $200,000. Marginal analysis implies that you:
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6. |
(Repeat your answer on Scantron lines 31 and 32.) Refer to the graph above. Evaluate statements 1 through 4 and then select the answer from A) through E):
1) Moving from point E to point F is accompanied by an increase in demand. 2) Moving from point E to point F is accompanied by a decrease in demand. 3) Moving from point E to point C is accompanied by no change in demand. 4) Moving from point E to point C is accompanied by an increase in demand.
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7. |
(Repeat answer on Scantron line 33.) Referring to the above diagram of an initial market equilibrium, if equilibrium moved to somewhere in area E, we could be sure that:
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8. |
One of the most important differences between mercantilism and capitalism is that mercantilism:
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9. |
(Repeat your answer on Scantron lines 34 and 35.) An example of "derived demand" is,
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10. |
(Repeat your answer on Scantron lines 36 and 37.) If money did not exist in a modern economy,
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11. |
(Repeat answer on Scantron line 38.) In the factor market:
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12. |
Karl Marx criticized capitalism because he believed that:
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13. |
(Repeat answer on Scantron lines 39 and 40.) Recently, the U.S. economy has:
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14. |
(Repeat answer on Scantron lines 41 and 42.) What are the two largest sources of revenue for the federal government?
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15. |
A business in which each owner is liable only to the extent of his or her own investment is called a:
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16. |
Businesses are:
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17. |
(Repeat answer on Scantron line 43.) Which of the following agencies would be most likely to loan developing countries money to build a hydroelectric dam?
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18. |
(Repeat answer on Scantron lines 44 and 45.) The Industrial Revolution:
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19. |
(Repeat answer on Scantron line 46.) Government's role in a market economy includes all of the following except:
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20. |
(Repeat answer on Scantron line 47.) The economic policy of leaving coordination of individuals' actions to the market is called:
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21. |
(Repeat your answer on Scantron line 48.) Choose the best answer if several are correct. When you produce corn, it is costly to produce small quantities
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22. |
(Repeat your answer on Scantron lines 49 and 50.) Decide which of the following statements about "models" are correct, and then choose the best answer from among A) through E) below:
1) Models are "abstract representations of reality", and therefore Picasso was a great model builder, since his paintings are "abstract representations of reality". 2) The best model is the one which gets the correct answer. 3) The best model is the one which is inexpensive and easy to use. 4) Models are used extensively in physics and the other sciences, in economics and the other social sciences, and even in history and english. However, models are not often used in daily life because models are mainly used by intellectuals. 5) Economic models are models which are inexpensive and economical to use. Choose the best answer:
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Answer Key
1. | E |
2. | B |
3. | A |
4. | C |
5. | A |
6. | D |
7. | B |
8. | A |
9. | B |
10. | A |
11. | C |
12. | D |
13. | B |
14. | D |
15. | D |
16. | B |
17. | B |
18. | C |
19. | D |
20. | B |
21. | D |
22. | D |