Question 1

As it relates to the R&D decision, the interest-rate cost-of-funds curve

Accepted Answer

A) usually slopes downward. 
B) is the marginal cost element in the MB = MC decision framework. 
C) indicates a constant rate of return, r. 
D) reflects the interest rate on bank loans but not the implicit interest rate on the use of retained earnings. 
A) usually slopes downward. 
B) is the marginal cost element in the MB = MC decision framework. 
C) indicates a constant rate of return, r. 
D) reflects the interest rate on bank loans but not the implicit interest rate on the use of retained earnings.

Question 2

R&D spending decisions by firms are complicated because they involve having to compare present expenditures against future expected gains.

Accepted Answer

A) True 
 B)False

Question 3

A firm decides to make a $20 million expenditure on research and development that will create a new product.This product is expected to increase the firm's revenues by a total of $24 million in the next year.The firm also estimates that the production cost of the new product will be $22 million.What is the expected rate of return on this research and development expenditure?

Accepted Answer

A) 8.3 percent 
B) 9.1 percent 
C) 10 percent 
D) 20 percent 
A) 8.3 percent 
B) 9.1 percent 
C) 10 percent 
D) 20 percent

Question 4

An amount of R&D spending that is less than the optimal amount indicates that the

Accepted Answer

A) interest-rate cost-of-funds and expected rate of return are constant. 
B) interest-rate cost-of-funds is equal to the expected rate of return. 
C) interest-rate cost-of-funds is less than the expected rate of return. 
D) interest-rate cost-of-funds is greater than the expected rate of return. 
A) interest-rate cost-of-funds and expected rate of return are constant. 
B) interest-rate cost-of-funds is equal to the expected rate of return. 
C) interest-rate cost-of-funds is less than the expected rate of return. 
D) interest-rate cost-of-funds is greater than the expected rate of return.

Question 5

Which of the following is a "spin-off" firm?

Accepted Answer

A) Amazon 
B) Yum! Brands 
C) McDonald's 
D) Pepsi 
A) Amazon 
B) Yum! Brands 
C) McDonald's 
D) Pepsi

Question 6

Process innovation can be depicted as

Accepted Answer

A) an upward shift in a firm's total product curve. 
B) an upward shift in a firm's marginal cost curve. 
C) a downward shift in a firm's marginal revenue curve. 
D) an increase in product demand. 
A) an upward shift in a firm's total product curve. 
B) an upward shift in a firm's marginal cost curve. 
C) a downward shift in a firm's marginal revenue curve. 
D) an increase in product demand.

Question 7

The following are examples of innovative products in their respective industries, except

Accepted Answer

A) Nokia's smartphones. 
B) Johnson & Johnson's disposable contact lenses. 
C) Hewlett-Packard's scientific calculator. 
D) Apple's iPhone. 
A) Nokia's smartphones. 
B) Johnson & Johnson's disposable contact lenses. 
C) Hewlett-Packard's scientific calculator. 
D) Apple's iPhone.

Question 8

Which would be a good example of a successful introduction of a new product?

Accepted Answer

A) McDonald's McLean burger 
B) Microsoft Windows 
C) Kodak disc cameras 
D) New Coke by Coca-Cola 
A) McDonald's McLean burger 
B) Microsoft Windows 
C) Kodak disc cameras 
D) New Coke by Coca-Cola

Exam 15: Technology, Rd, and Efficiency

As it relates to the R&D decision, the interest-rate cost-of-funds curve

R&D spending decisions by firms are complicated because they involve having to compare present expenditures against future expected gains.

An amount of R&D spending that is less than the optimal amount indicates that the

Which of the following is a "spin-off" firm?

Process innovation can be depicted as

The following are examples of innovative products in their respective industries, except

Which would be a good example of a successful introduction of a new product?

Limits, Alternatives, and Choices

The Market System and the Circular Flow

Demand, Supply, and Market Equilibrium

Market Failures: Public Goods and Externalities

Governments Role and Government Failure

Elasticity

Utility Maximization

Behavioral Economics

Businesses and the Costs of Production

Pure Competition in the Short Run

Pure Competition in the Long Run

Pure Monopoly

Monopolistic Competition

Oligopoly and Strategic Behavior

The Demand for Resources

Wage Determination

Rent, Interest, and Profit

Natural Resource and Energy Economics

Public Finance: Expenditures and Taxes

Antitrust Policy and Regulation

Agriculture: Economics and Policy

Income Inequality, Poverty, and Discrimination

Health Care

Immigration

An Introduction to Macroeconomics

Measuring Domestic Output and National Income

Economic Growth

Business Cycles, Unemployment, and Inflation

Basic Macroeconomic Relationships

The Aggregate Expenditures Model

Aggregate Demand and Aggregate Supply

Fiscal Policy, Deficits, and Debt

Money, Banking, and Financial Institutions

Money Creation

Interest Rates and Monetary Policy

Financial Economics

Extending the Analysis of Aggregate Supply

Current Issues in Macro Theory and Policy

International Trade

The Balance of Payments, Exchange Rates, and Trade Deficits

The Economics of Developing Countries

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