Question 1

Which of the following is true?

Accepted Answer

A)  Women are more highly unionized than men. 
B)  A higher percent of white workers belong to unions than do African-American workers. 
C)  The proportion of government employees belonging to a union is substantially higher than the proportion of private-sector workers who are union members. 
D)  There is little difference in incidence of unionization among occupational categories. 
A)  Women are more highly unionized than men. 
B)  A higher percent of white workers belong to unions than do African-American workers. 
C)  The proportion of government employees belonging to a union is substantially higher than the proportion of private-sector workers who are union members. 
D)  There is little difference in incidence of unionization among occupational categories.

Question 2

From the standpoint of economic efficiency, which of the following is a major advantage of medical savings accounts?

Accepted Answer

A)  They encourage healthcare consumers to purchase low-deductible, low co-payment medical insurance plans. 
B)  They guarantee that no American will ever have to pay another medical bill. 
C)  They encourage healthcare consumers to economize. 
D)  They will force employers to pay a larger share of the medical expenses of their employees. 
A)  They encourage healthcare consumers to purchase low-deductible, low co-payment medical insurance plans. 
B)  They guarantee that no American will ever have to pay another medical bill. 
C)  They encourage healthcare consumers to economize. 
D)  They will force employers to pay a larger share of the medical expenses of their employees.

Question 3

When overall production is taken into account, trade restrictions, such as those enacted by the Smoot-Hawley trade bill,

Accepted Answer

A)  save good paying jobs. 
B)  neither create nor destroy jobs; they reallocate them. 
C)  increase employment in the domestic industries that are most productive. 
D)  reduce imports, without affecting the volume of exports. 
A)  save good paying jobs. 
B)  neither create nor destroy jobs; they reallocate them. 
C)  increase employment in the domestic industries that are most productive. 
D)  reduce imports, without affecting the volume of exports.

Question 4

While the price of a resource may increase sharply during some periods, the structure of ____ accompanying the price increase makes depletion highly unlikely and provides the seeds for future reversal.

Accepted Answer

A)  government programs 
B)  foreign competition 
C)  incentives 
D)  taxation 
A)  government programs 
B)  foreign competition 
C)  incentives 
D)  taxation

Question 5

Which of the following is the most efficient way to reduce pollution emissions?

Accepted Answer

A)  Emission standards that cap allowable pollution. 
B)  Government pollution charges or taxes. 
C)  Legislated regulations limiting the quantity of emissions allowed by each firm. 
D)  Enforcement of property rights, when those rights are well-defined and transaction costs are low. 
A)  Emission standards that cap allowable pollution. 
B)  Government pollution charges or taxes. 
C)  Legislated regulations limiting the quantity of emissions allowed by each firm. 
D)  Enforcement of property rights, when those rights are well-defined and transaction costs are low.

Question 6

How does competition from nonunion firms and foreign producers affect the ability of a union to increase the wages of its members?

Accepted Answer

A)  Such competition reduces the ability of a union to achieve wage increases. 
B)  Such competition does not affect the ability of a union to achieve wage increases. 
C)  Such competition will increase the strength of a union if it produces a product sold in the domestic market but reduce the strength of the union if it produces an export product. 
D)  The effect of this type of competition will be entirely dependent on the elasticity of demand for labor in the domestic market. 
A)  Such competition reduces the ability of a union to achieve wage increases. 
B)  Such competition does not affect the ability of a union to achieve wage increases. 
C)  Such competition will increase the strength of a union if it produces a product sold in the domestic market but reduce the strength of the union if it produces an export product. 
D)  The effect of this type of competition will be entirely dependent on the elasticity of demand for labor in the domestic market.

Question 7

Charter schools are

Accepted Answer

A)  privately funded schools 
B)  typically religious schools 
C)  non-traditional schools funded and operated by the government 
D)  government operated schools that compete with private schools by charging tuition and providing competitive services. 
A)  privately funded schools 
B)  typically religious schools 
C)  non-traditional schools funded and operated by the government 
D)  government operated schools that compete with private schools by charging tuition and providing competitive services.

Question 8

Investors can make their investments in corporate stocks less risky by

Accepted Answer

A)  purchasing shares of a mutual fund, which holds the stocks of many diverse corporations. 
B)  buying stocks and holding them each for only for short periods of time. 
C)  investing in firms that are in the same, rather than different, industries. 
D)  none of the above. 
A)  purchasing shares of a mutual fund, which holds the stocks of many diverse corporations. 
B)  buying stocks and holding them each for only for short periods of time. 
C)  investing in firms that are in the same, rather than different, industries. 
D)  none of the above.

Question 9

Which of the following is true?

Accepted Answer

A)  Healthcare in Canada and most of the European countries is a socialized industry. 
B)  Socialization of the healthcare industry eliminates the problem of scarcity in the healthcare industry. 
C)  The high-income countries of Europe are able to provide as much healthcare, free of charge, as their citizens want. 
D)  All of the above are true. 
A)  Healthcare in Canada and most of the European countries is a socialized industry. 
B)  Socialization of the healthcare industry eliminates the problem of scarcity in the healthcare industry. 
C)  The high-income countries of Europe are able to provide as much healthcare, free of charge, as their citizens want. 
D)  All of the above are true.

Question 10

The mortgage-backed securities issued by investment banks caused many investment banks to fail when

Accepted Answer

A)  stock prices declined by approximately 40 percent in 2008. 
B)  housing prices increased rapidly beginning in 2002. 
C)  federal regulators required investment banks to maintain more capital against their residential housing loans than was true for commercial business loans. 
D)  the default rates of the mortgages financed by the securities increased sharply. 
A)  stock prices declined by approximately 40 percent in 2008. 
B)  housing prices increased rapidly beginning in 2002. 
C)  federal regulators required investment banks to maintain more capital against their residential housing loans than was true for commercial business loans. 
D)  the default rates of the mortgages financed by the securities increased sharply.

Question 11

Researcher Terry Anderson claims that with respect to the supply of water, trading it would be

Accepted Answer

A)  wrong and counter-productive. 
B)  essentially impossible due to lack of technologies to move the water. 
C)  highly productive and bring cooperation among the traders. 
D)  a problem, since monopolists would come to own too much. 
A)  wrong and counter-productive. 
B)  essentially impossible due to lack of technologies to move the water. 
C)  highly productive and bring cooperation among the traders. 
D)  a problem, since monopolists would come to own too much.

Question 12

In 2007, health-care expenditures were approximately what percent of GDP?

Accepted Answer

A)  6 percent 
B)  16 percent 
C)  26 percent 
D)  36 percent 
A)  6 percent 
B)  16 percent 
C)  26 percent 
D)  36 percent

Question 13

Why is the current U.S. tax-treatment of health insurance purchased through one's employer discriminatory?

Accepted Answer

A)  Health insurance should not be a tax-deductible expense for anyone. 
B)  The system gives preferential tax treatment to self-employed individuals. 
C)  The system imposes higher taxes on the direct purchase of health insurance because it is not tax deductible. 
D)  The system gives preferential tax treatment to people who purchase health insurance directly from a provider. 
A)  Health insurance should not be a tax-deductible expense for anyone. 
B)  The system gives preferential tax treatment to self-employed individuals. 
C)  The system imposes higher taxes on the direct purchase of health insurance because it is not tax deductible. 
D)  The system gives preferential tax treatment to people who purchase health insurance directly from a provider.

Question 14

If governments provide free healthcare services,

Accepted Answer

A)  this illustrates that governments can provide healthcare more economically than private firms. 
B)  output and consumption of other goods will not be sacrificed. 
C)  resources with alternative uses are allocated to healthcare and there is an opportunity cost of these resources. 
D)  the opportunity cost of the resources used to supply healthcare is zero. 
A)  this illustrates that governments can provide healthcare more economically than private firms. 
B)  output and consumption of other goods will not be sacrificed. 
C)  resources with alternative uses are allocated to healthcare and there is an opportunity cost of these resources. 
D)  the opportunity cost of the resources used to supply healthcare is zero.

Question 15

When employment discrimination results from the personal prejudices of employers,

Accepted Answer

A)  only legal requirements will be able to reduce the amount of employment discrimination. 
B)  competitive markets will generally tend to promote discrimination as firms try to lower their costs to increase their profits. 
C)  competitive markets will tend to make it costly for employers to discriminate, reducing the amount of discrimination. 
D)  none of the above will be true. 
A)  only legal requirements will be able to reduce the amount of employment discrimination. 
B)  competitive markets will generally tend to promote discrimination as firms try to lower their costs to increase their profits. 
C)  competitive markets will tend to make it costly for employers to discriminate, reducing the amount of discrimination. 
D)  none of the above will be true.

Question 16

In the future, the earnings differential between women and men is expected to

Accepted Answer

A)  widen. 
B)  become smaller. 
C)  remain about the same as it is now. 
D)  become smaller over the next five years then begin to widen again. 
A)  widen. 
B)  become smaller. 
C)  remain about the same as it is now. 
D)  become smaller over the next five years then begin to widen again.

Question 17

Jane states that "Social Security is an unfair program. It discriminates against married women in the workforce and middle-income recipients." Evaluate this view.

Accepted Answer

Social Security discriminates against ma

Question 18

Which of the following is an example of a transfer payment?

Accepted Answer

A)  wages and salaries paid to the employees of the Internal Revenue Service 
B)  purchase of automobiles by a local police department 
C)  agriculture subsidies paid to farmers 
D)  salaries paid to the college professors of state-operated universities 
A)  wages and salaries paid to the employees of the Internal Revenue Service 
B)  purchase of automobiles by a local police department 
C)  agriculture subsidies paid to farmers 
D)  salaries paid to the college professors of state-operated universities

Question 19

Government regulation is

Accepted Answer

A)  subject to the same problems of lack of information and lack of incentives for economic efficiency as centrally planned economies. 
B)  the only reliable way to improve environmental quality. 
C)  not subject to political concerns when it comes to environmental quality. 
D)  the most economically efficient way to reduce greenhouse gases. 
A)  subject to the same problems of lack of information and lack of incentives for economic efficiency as centrally planned economies. 
B)  the only reliable way to improve environmental quality. 
C)  not subject to political concerns when it comes to environmental quality. 
D)  the most economically efficient way to reduce greenhouse gases.

Question 20

What does the evidence suggest regarding the effects of school choice programs?

Accepted Answer

The evidence so far suggests four findin

Which of the following is true?

From the standpoint of economic efficiency, which of the following is a major advantage of medical savings accounts?

When overall production is taken into account, trade restrictions, such as those enacted by the Smoot-Hawley trade bill,

While the price of a resource may increase sharply during some periods, the structure of ____ accompanying the price increase makes depletion highly unlikely and provides the seeds for future reversal.

Which of the following is the most efficient way to reduce pollution emissions?

How does competition from nonunion firms and foreign producers affect the ability of a union to increase the wages of its members?

Charter schools are

Investors can make their investments in corporate stocks less risky by

Which of the following is true?

The mortgage-backed securities issued by investment banks caused many investment banks to fail when

Researcher Terry Anderson claims that with respect to the supply of water, trading it would be

In 2007, health-care expenditures were approximately what percent of GDP?

Why is the current U.S. tax-treatment of health insurance purchased through one's employer discriminatory?

If governments provide free healthcare services,

When employment discrimination results from the personal prejudices of employers,

In the future, the earnings differential between women and men is expected to

Jane states that "Social Security is an unfair program. It discriminates against married women in the workforce and middle-income recipients." Evaluate this view.

Which of the following is an example of a transfer payment?

Government regulation is

What does the evidence suggest regarding the effects of school choice programs?

The Economic Approach

Some Tools of the Economist

Demand, Supply, and the Market Process

Supply and Demand: Applications and Extensions

Difficult Cases for the Market, and the Role of Government

The Economics of Political Action

Consumer Choice and Elasticity

Costs and the Supply of Goods

Price Takers and the Competitive Process

Price-Searcher Markets With Low Entry Barriers

Price-Searcher Markets With High Entry Barriers

The Supply of and Demand for Productive Resources

Earnings, Productivity, and the Job Market

Investment, the Capital Market, and the Wealth of Nations

Income Inequality and Poverty

Filters

Exam 16: Applying the Basics: Special Topics in Economics

Which of the following is true?

From the standpoint of economic efficiency, which of the following is a major advantage of medical savings accounts?

When overall production is taken into account, trade restrictions, such as those enacted by the Smoot-Hawley trade bill,

While the price of a resource may increase sharply during some periods, the structure of ____ accompanying the price increase makes depletion highly unlikely and provides the seeds for future reversal.

Which of the following is the most efficient way to reduce pollution emissions?

How does competition from nonunion firms and foreign producers affect the ability of a union to increase the wages of its members?

Charter schools are

Investors can make their investments in corporate stocks less risky by

Which of the following is true?

The mortgage-backed securities issued by investment banks caused many investment banks to fail when

Researcher Terry Anderson claims that with respect to the supply of water, trading it would be

In 2007, health-care expenditures were approximately what percent of GDP?

Why is the current U.S. tax-treatment of health insurance purchased through one's employer discriminatory?

If governments provide free healthcare services,

When employment discrimination results from the personal prejudices of employers,

In the future, the earnings differential between women and men is expected to

Jane states that "Social Security is an unfair program. It discriminates against married women in the workforce and middle-income recipients." Evaluate this view.

Which of the following is an example of a transfer payment?

Government regulation is

What does the evidence suggest regarding the effects of school choice programs?

The Economic Approach

Some Tools of the Economist

Demand, Supply, and the Market Process

Supply and Demand: Applications and Extensions

Difficult Cases for the Market, and the Role of Government

The Economics of Political Action

Consumer Choice and Elasticity

Costs and the Supply of Goods

Price Takers and the Competitive Process

Price-Searcher Markets With Low Entry Barriers

Price-Searcher Markets With High Entry Barriers

The Supply of and Demand for Productive Resources

Earnings, Productivity, and the Job Market

Investment, the Capital Market, and the Wealth of Nations

Income Inequality and Poverty

Filters