Recent Question

One commonly used test in checking for the presence of autocorrelation 1. The presence of association between two variables does not necessarily imply causation for the following reason(s): a. the association between two variables may result simply from pure chance b. the association between two variables may be the result of the influence of a third common factor c. both variables may be the cause and the effect at the same time d. a ...

Other / Other 23 Apr 2016

What’s true about both the short-run and long-run 1. What’s true about both the short-run and long-run in terms of production and cost analysis? a. In the short-run, one or more of the resources are fixed b. In the long-run, all the factors are variable c. The time horizon determines whether or not an input variable is fixed or not d. The law of diminishing returns is based in part on some factors of production being fix ...

Other / Other 23 Apr 2016

Marginal factor cost is defined as the amount that an additional unit of the variable input 1. Marginal revenue product is: a. defined as the amount that an additional unit of the variable input adds to the total revenue b. equal to the marginal factor cost of the variable factor times the marginal revenue resulting from the increase in output obtained c. equal to the marginal product of the variable factor times the marginal product re ...

Other / Other 23 Apr 2016

An industry can be characterized by the following production 1. An industry can be characterized by the following production function: Q = 2.5L.60 C.40 (a) What is the algebraic expression for the marginal productivity of labor? (b) What is the algebraic expression for the average productivity of labor? (c) How would you characterize the returns-to-scale in the industry? 2. Emco Company has an assembly line of fixed siz ...

Other / Other 23 Apr 2016

The primary objective of a for-profit firm is 1. Which of the following will increase (V0), the shareholder wealth maximization model of the firm: V0∙(shares outstanding) = t=1(t ) / (1+ke)t + Real Option Value. a. Decrease the required rate of return (ke). b. Decrease the stream of profits (t). c. Decrease the number of periods from  to 10 periods. d. Decrease the real option value. e. All ...

Other / Other 23 Apr 2016

A linear demand for lake front cabins on a nearby lake 1. Suppose we estimate that the demand elasticity for fine leather jackets is .7 at their current prices. Then we know that: a. a 1% increase in price reduces quantity sold by .7%. b. no one wants to buy leather jackets. c. demand for leather jackets is elastic. d. a cut in the prices will increase total revenue. e. leather jackets are luxury items. 2. If demand ...

Other / Other 23 Apr 2016

Demand functions in the multiplicative form are most common 1. The method which can give some information in estimating demand of a product that hasn’t yet come to market is: a. the consumer survey b. market experimentation c. a statistical demand analysis d. plotting the data e. the barometric method 2. Demand functions in the multiplicative form are most common for all of the following reasons except: a. elastici ...

Other / Other 23 Apr 2016

A cottage industry exists in the home-manufacture 1. Which of the following statements concerning the long-run average cost curve of economic theory is true? a. It is L-shaped b. It is -shaped c. It is -shaped d. It is -shaped e. It is M-shaped 2. Possible sources of economies of scale (size) within a production plant include: a. specialization in the use of capital and labor b. imperfections in the ...

Other / Other 23 Apr 2016

Trading partners should specialize in producing goods 1. In an open economy with few capital restrictions and substantial import-export trade, a rise in interest rates and a decline in the producer price index of inflation will a. raise the value of the currency b. lower the nominal interest rate c. increase the volume of trading in the foreign exchange market d. lower the trade-weighted exchange rate e. increase consumer inflation. ...

Other / Other 23 Apr 2016

The Future Flight Corporation manufactures a variety of Frisbees 1. The Future Flight Corporation manufactures a variety of Frisbees selling for $2.98 each. Sales have averaged 10,000 units per month during the last year. Recently Future Flight's closest competitor, Soaring Free Company, cut its prices on similar Frisbees from $3.49 to $2.59. Future Flight noticed that its sales declined to 8,000 units per month after the price cut. (a ...

Other / Other 23 Apr 2016