Question 1

Special interest groups,in the theory of regulation,may be defined as:

Accepted Answer

A) public-spirited individuals who will benefit from regulation. 
B) self-interested individuals who benefit from regulation. 
C) self-interested individuals who will suffer from regulation. 
D) public-spirited individuals who will suffer from regulation. 
A) public-spirited individuals who will benefit from regulation. 
B) self-interested individuals who benefit from regulation. 
C) self-interested individuals who will suffer from regulation. 
D) public-spirited individuals who will suffer from regulation. B

Question 2

In 2003,conservation groups paid western cattlemen to move their herds away from wild buffalo herds so that the buffalo would have more feed and not have to compete with the cattle.What has this got to do with regulation and the Coase Theorem?

Accepted Answer

The Coase Theorem holds that when property rights are clearly assigned and contracting costs are sufficiently low,the ultimate allocation of resources will be efficient.An offer of payment for moving their herds leads the cattlemen to internalize the costs of their cattle grazing near the buffalo herds.No regulation is necessary to achieve this efficient outcome other than well-defined and enforceable property rights.

Question 3

Information asymmetries between producers or consumers along with the problems of externalities can:

Accepted Answer

A) cause market failure. 
B) always be solved by alternative dispute resolution (ADR)mechanisms. 
C) improve free trade. 
D) restrict the use of property rights in a market economy. 
A) cause market failure. 
B) always be solved by alternative dispute resolution (ADR)mechanisms. 
C) improve free trade. 
D) restrict the use of property rights in a market economy. A

Question 4

The 1890 Sherman Act was legislated by the:

Accepted Answer

A) Securities and Exchange Board (SE
C) . 
B) Environment Protection Agency (EP
A) . 
C) Food and Drug Administration (FD
A) . 
D) Federal Trade Commission (FT
C) . 
A) Securities and Exchange Board (SE
C) . 
B) Environment Protection Agency (EP
A) . 
C) Food and Drug Administration (FD
A) . 
D) Federal Trade Commission (FT
C) .

Question 5

Which of the following regulatory procedures transfers wealth from the initial landowners whose property is restricted to those landowners whose land has no restrictions?

Accepted Answer

A) Tax on agricultural income 
B) Import quota 
C) Zoning restrictions 
D) Price ceiling 
A) Tax on agricultural income 
B) Import quota 
C) Zoning restrictions 
D) Price ceiling

Question 6

For a politician or a regulator of an industry,there is a clear trade-off between:

Accepted Answer

A) inflation and investment. 
B) profits and costs of the regulated company. 
C) prices charged to consumers and profits earned by producers. 
D) resource utilization and the generation of externalities. 
A) inflation and investment. 
B) profits and costs of the regulated company. 
C) prices charged to consumers and profits earned by producers. 
D) resource utilization and the generation of externalities.

Question 7

In some industries,pollution rights are sold from one company that does not need them to another that does.In recent years,conservation groups have purchased pollution rights so they cannot be exercised.Companies in need of pollution rights will find that:

Accepted Answer

A) the supply of pollution rights has increased. 
B) the prices of pollution rights have fallen. 
C) the relative costs of pollution control equipment has gone up. 
D) the prices of pollution rights have gone up. 
A) the supply of pollution rights has increased. 
B) the prices of pollution rights have fallen. 
C) the relative costs of pollution control equipment has gone up. 
D) the prices of pollution rights have gone up.

Question 8

Alternative Dispute Resolution (ADR)is used by many companies to:

Accepted Answer

A) eliminate the need for a court system. 
B) solve problems associated with the distribution of public goods. 
C) reduce government intervention in international trade. 
D) reduce the high cost of commercial litigation. 
A) eliminate the need for a court system. 
B) solve problems associated with the distribution of public goods. 
C) reduce government intervention in international trade. 
D) reduce the high cost of commercial litigation.

Question 9

A person buys a used 1998 Honda Civic and finds that there is a problem in the drive train so that the whole set of axles must be replaced.However,the state has a law that protects the buyer from these kinds of discoveries for 30 days post purchase.These lemon laws attempt to correct the problem of:

Accepted Answer

A) monopoly power. 
B) adverse selection. 
C) resource over-utilization. 
D) arbitrage. 
A) monopoly power. 
B) adverse selection. 
C) resource over-utilization. 
D) arbitrage.

Question 10

Draw a profit/price trade-off curve that results from moving from a competitive to a monopoly industry organization.Show the equilibrium position for the regulator with a political support function (PS curve).What can we say about prices and profits of the regulated industry if it started as a monopoly?

Accepted Answer

@#IMG-DLM& The above diagram shows the equilibriu

Question 11

Which of these will hold true for an unregulated,competitive industry?

Accepted Answer

A) The market price will be higher than the marginal cost of production. 
B) The marginal cost will be higher than the average cost of production. 
C) The marginal cost of production will be equal to the market price. 
D) The market price will be lower than the marginal cost of production. 
A) The market price will be higher than the marginal cost of production. 
B) The marginal cost will be higher than the average cost of production. 
C) The marginal cost of production will be equal to the market price. 
D) The market price will be lower than the marginal cost of production.

Question 12

In the U.S.,combined wealth losses by firms from litigation have been estimated to be___________ per lawsuit.

Accepted Answer

A) $200 million 
B) $20 billion 
C) $2 billion 
D) $21 million 
A) $200 million 
B) $20 billion 
C) $2 billion 
D) $21 million

Question 13

In the 1980s,"voluntary restrictions" on automobile imports raised the prices of Japanese cars by $1,000,of European cars by $2,000,and of American cars by $500.During the period following these restrictions,both Japanese and European automakers opened parts and assembly plants in the US.Why did this happen? How is it related to regulation?

Accepted Answer

The threat of government regulation led

Question 14

State and federal regulators retain the authority to set or approve public utilities' prices.An important prerequisite for this role is to know the utility's:

Accepted Answer

A) price elasticity of supply. 
B) true cost function. 
C) income elasticity of demand. 
D) price in other economies. 
A) price elasticity of supply. 
B) true cost function. 
C) income elasticity of demand. 
D) price in other economies.

Question 15

In parts of Eastern Europe,companies maintain special guards to protect payday funds,to help move products to market,and to enforce immediate payment for products sold to retailers.All of these features indicate:

Accepted Answer

A) that property rights are respected and transaction costs are low. 
B) that property rights are weak and transaction costs are low. 
C) that property rights are weak and transaction costs are high. 
D) that property rights are respected and transaction costs are high 
A) that property rights are respected and transaction costs are low. 
B) that property rights are weak and transaction costs are low. 
C) that property rights are weak and transaction costs are high. 
D) that property rights are respected and transaction costs are high

Question 16

Which of the following regulatory procedures transfers wealth from consumers to producers?

Accepted Answer

A) Import quotas and tariffs 
B) Efficiency wages 
C) Transaction costs 
D) Deadweight loss 
A) Import quotas and tariffs 
B) Efficiency wages 
C) Transaction costs 
D) Deadweight loss

Question 17

Draw a profit/price trade-off curve that is the result of moving from a competitive to a monopoly industry organization.Show the equilibrium position for the regulator with a political support function (PS curve).What can we say about prices and profits of the regulated industry if it started as a competitive industry?

Accepted Answer

@#IMG-DLM& The above diagram shows the equilibrium

Question 18

In some industries,pollution rights are sold from one company that does not need them to another that does.In recent years,conservation groups have purchased pollution rights so that they cannot be traded.Companies in need of pollution rights will find that:

Accepted Answer

A) the supply of pollution rights has increased. 
B) the prices of pollution rights have fallen. 
C) the relative costs of pollution control equipment have gone up. 
D) the supply of pollution rights has declined. 
A) the supply of pollution rights has increased. 
B) the prices of pollution rights have fallen. 
C) the relative costs of pollution control equipment have gone up. 
D) the supply of pollution rights has declined.

Question 19

The transaction costs of writing and enforcing contracts are higher in:

Accepted Answer

A) countries with poorly enforced property rights. 
B) countries with stringent trade restrictions. 
C) all countries with good court systems. 
D) countries without political risks of property confiscation. 
A) countries with poorly enforced property rights. 
B) countries with stringent trade restrictions. 
C) all countries with good court systems. 
D) countries without political risks of property confiscation.

Question 20

Public goods:

Accepted Answer

A) are goods for a few,by a few,and of a few. 
B) are goods whose consumption imposes a deadweight loss on the entire society. 
C) are goods whose consumption by one reduces the amount available to others. 
D) are goods whose consumption by one does not diminish the amount available to others. 
A) are goods for a few,by a few,and of a few. 
B) are goods whose consumption imposes a deadweight loss on the entire society. 
C) are goods whose consumption by one reduces the amount available to others. 
D) are goods whose consumption by one does not diminish the amount available to others.

Special interest groups,in the theory of regulation,may be defined as:

In 2003,conservation groups paid western cattlemen to move their herds away from wild buffalo herds so that the buffalo would have more feed and not have to compete with the cattle.What has this got to do with regulation and the Coase Theorem?

Information asymmetries between producers or consumers along with the problems of externalities can:

The 1890 Sherman Act was legislated by the:

Which of the following regulatory procedures transfers wealth from the initial landowners whose property is restricted to those landowners whose land has no restrictions?

For a politician or a regulator of an industry,there is a clear trade-off between:

In some industries,pollution rights are sold from one company that does not need them to another that does.In recent years,conservation groups have purchased pollution rights so they cannot be exercised.Companies in need of pollution rights will find that:

Alternative Dispute Resolution (ADR)is used by many companies to:

A person buys a used 1998 Honda Civic and finds that there is a problem in the drive train so that the whole set of axles must be replaced.However,the state has a law that protects the buyer from these kinds of discoveries for 30 days post purchase.These lemon laws attempt to correct the problem of:

Which of these will hold true for an unregulated,competitive industry?

In the U.S.,combined wealth losses by firms from litigation have been estimated to be___________ per lawsuit.

State and federal regulators retain the authority to set or approve public utilities' prices.An important prerequisite for this role is to know the utility's:

In parts of Eastern Europe,companies maintain special guards to protect payday funds,to help move products to market,and to enforce immediate payment for products sold to retailers.All of these features indicate:

Which of the following regulatory procedures transfers wealth from consumers to producers?

In some industries,pollution rights are sold from one company that does not need them to another that does.In recent years,conservation groups have purchased pollution rights so that they cannot be traded.Companies in need of pollution rights will find that:

The transaction costs of writing and enforcing contracts are higher in:

Public goods:

Introduction

Economists View of Behavior

Exchange and Markets

Demand

Production and Cost

Market Structure

Pricing With Market Power

Economics of Strategy: Creating and Capturing Value

Economics of Strategy: Game Theory

Incentive Conflicts and Contracts

Organizational Architecture

Decision Rights: the Level of Empowerment

Decision Rights: Bundling Tasks Into Jobs and Subunits

Attracting and Retaining Qualified Employees

Incentive Compensation

Individual Performance Evaluation

Divisional Performance Evaluation

Corporate Governance

Vertical Integration and Outsourcing

Leadership: Motivating Change Within Organizations

Ethics and Organizational Architecture

Organizational Architecture and the Process of Management Innovation

Filters

Exam 21: Understanding the Business Environment: the Economics of Regulation

Special interest groups,in the theory of regulation,may be defined as:

In 2003,conservation groups paid western cattlemen to move their herds away from wild buffalo herds so that the buffalo would have more feed and not have to compete with the cattle.What has this got to do with regulation and the Coase Theorem?

Information asymmetries between producers or consumers along with the problems of externalities can:

The 1890 Sherman Act was legislated by the:

Which of the following regulatory procedures transfers wealth from the initial landowners whose property is restricted to those landowners whose land has no restrictions?

For a politician or a regulator of an industry,there is a clear trade-off between:

In some industries,pollution rights are sold from one company that does not need them to another that does.In recent years,conservation groups have purchased pollution rights so they cannot be exercised.Companies in need of pollution rights will find that:

Alternative Dispute Resolution (ADR)is used by many companies to:

Which of these will hold true for an unregulated,competitive industry?

In the U.S.,combined wealth losses by firms from litigation have been estimated to be___________ per lawsuit.

State and federal regulators retain the authority to set or approve public utilities' prices.An important prerequisite for this role is to know the utility's:

In parts of Eastern Europe,companies maintain special guards to protect payday funds,to help move products to market,and to enforce immediate payment for products sold to retailers.All of these features indicate:

Which of the following regulatory procedures transfers wealth from consumers to producers?

In some industries,pollution rights are sold from one company that does not need them to another that does.In recent years,conservation groups have purchased pollution rights so that they cannot be traded.Companies in need of pollution rights will find that:

The transaction costs of writing and enforcing contracts are higher in:

Public goods:

Introduction

Economists View of Behavior

Exchange and Markets

Demand

Production and Cost

Market Structure

Pricing With Market Power

Economics of Strategy: Creating and Capturing Value

Economics of Strategy: Game Theory

Incentive Conflicts and Contracts

Organizational Architecture

Decision Rights: the Level of Empowerment

Decision Rights: Bundling Tasks Into Jobs and Subunits

Attracting and Retaining Qualified Employees

Incentive Compensation

Individual Performance Evaluation

Divisional Performance Evaluation

Corporate Governance

Vertical Integration and Outsourcing

Leadership: Motivating Change Within Organizations

Ethics and Organizational Architecture

Organizational Architecture and the Process of Management Innovation

Filters