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ECO 365 Final Exam Guide

ECO 365 Final Exam Guide

Study Unit: ECO 365
University of Phoenix Final Exam Guide with Answers

TUTORIAL: Includes study guide with answers for final exam.

Sample exam questions:
1. Macroeconomics is

2. The invisible hand theorem comes from

3. The law of demand states that the quantity demanded of a good is inversely related to the price of that good. Therefore, as the price of a good goes

4. Which of the following situations best demonstrates the law of demand?

5. If quantity demanded does not change when the price changes, the demand

6. High gasoline prices hit commuters who live far from their jobs in areas with little public transportation hard. With few alternatives, they have to bear the higher cost. Based on this information, how would you characterize demand for gasoline by these commuters?

7. Mr. Woodard has found it necessary to hire more workers. However, he has observed that doubling the number of workers has less than doubled his output. What is the likely explanation?

8. Marginal product eventually

9. Suppose you operate a factory that produces gadgets. Your current output is 1,000 gadgets. If your fixed cost is $10,000 and your total cost is $50,000, then the

10. The average variable cost curve is a mirror image of the

11. Suppose wages and employment decrease. These changes were most likely caused by a(n)

12. The incentive effect refers to how much a person will change his or her

13. Rachel left her job as a graphic artist, where she earned $42,000 per year, to open her own graphic arts firm. Her explicit costs for the new business include

14. If your company cell phone bill is either $40 when you use up to 300 minutes per month or $80 when you use between 300 to 400 minutes per month, the marginal cost of the 301st minute is

15. A market structure in which one firm makes up the entire market is

16. There are many restaurants in Raleigh, North Carolina, each one offering food and services that differ from those of its competitors. There is also the free entry of sellers into the market, and each seller serves a small fraction of the total number of meals served each day. The restaurant industry in Raleigh is best categorized as

17. The difference between a monopolist and a monopolistic competitor is that

18. If a perfectly competitive firm finds that price is less than the average variable cost, it should

19. A perfectly competitive firm facing a price of $10 decides to produce 100 widgets. If its marginal cost of producing the last widget is $12 and it seeks to maximize profit, the firm should

20. If a firm has a monopoly over the sale of photographic paper and seeks to maximize profits, it

21. The best example of a positive externality is

22. The cost of running an electrical utility includes costs for fuel, labor, and capital. In addition, there are sometimes costs associated with pollution from the utility, such as increased health care costs for people living near the utility. To an economist, the costs associated with the pollution resulting from additional electricity are

23. When Turner Network, producer and owner of movies, bought a local cable company, it was an example of a

24. KMart® acquired Sears® so both companies could better compete with Walmart®. This acquisition is an example of a

25. When government imposes a per unit tax on a product, the net price producers receive for the product after all taxes typically

26. In 1997, the federal government reinstated a 10% excise tax on airline tickets. The industry tried to pass on the full 10% ticket tax to consumers, but was only able to boost the price per plane ticket by 4%. From this, you can conclude that the

27. Countries can expect to gain from international trade as long as they

28. Technological changes in telecommunications have

29. In the US, the outsourcing of service jobs, such as those in call centers, has become a political issue. How do economists typically view outsourcing?

30. When a U.S. company establishes a call center in India that answers its customer service calls, the US is