Question 1

Economic profits are:

Accepted Answer

A) total revenue minus total cost. 
B) marginal revenue minus marginal cost. 
C) total revenue minus total opportunity cost. 
D) total profits of the economy as a whole. 
A) total revenue minus total cost. 
B) marginal revenue minus marginal cost. 
C) total revenue minus total opportunity cost. 
D) total profits of the economy as a whole.

Question 2

You are the manager of a firm that plans to expand the human resource base of its operation by hiring additional business school graduates over the next few years.You recently read an article in The Wall Street Journal that reports that enrollments in business schools have declined as students are moving into the "hard sciences." That same article reports that the shakeup of upper-management is over at U.S.firms, and that over the next decade there will be a nationwide surge in the demand for MBA's.How will these events affect your firm's ability to expand its own base of MBA's?

Accepted Answer

The recent decline in MBA's reflects exi

Question 3

The first-order condition for maximizing net benefits is

Accepted Answer

A) dB/dQ = dC/dQ. 
B) dN/dQ = 0. 
C) d2N/dQ2 = 0. 
D) dB/dQ = dC/dQ and dN/dQ = 0. 
A) dB/dQ = dC/dQ. 
B) dN/dQ = 0. 
C) d2N/dQ2 = 0. 
D) dB/dQ = dC/dQ and dN/dQ = 0.

Question 4

The additional benefits that arise by using an additional unit of the managerial control variable is defined as the:

Accepted Answer

A) total benefit. 
B) opportunity cost. 
C) marginal benefit. 
D) present value of benefits. 
A) total benefit. 
B) opportunity cost. 
C) marginal benefit. 
D) present value of benefits.

Question 5

If the interest rate is five percent, the present value of $200 received at the end of five years is:

Accepted Answer

A) $121.34. 
B) $156.71. 
C) $176.41. 
D) $132.62. 
A) $121.34. 
B) $156.71. 
C) $176.41. 
D) $132.62.

Question 6

-What is the marginal cost associated with producing three units of the control variable, Q (identify point E in the above table)?

Accepted Answer

A) 50. 
B) 100. 
C) 200. 
D) 300. 
A) 50. 
B) 100. 
C) 200. 
D) 300.

Question 7

In order to maximize net benefits, the managerial control variable should be used up to the point where:

Accepted Answer

A) total costs equal total benefits. 
B) average costs equal marginal benefits. 
C) average benefits equal marginal costs. 
D) net marginal benefits equal zero. 
A) total costs equal total benefits. 
B) average costs equal marginal benefits. 
C) average benefits equal marginal costs. 
D) net marginal benefits equal zero.

Question 8

As more firms enter an industry

Accepted Answer

A) accounting profits increase. 
B) economic profits decrease. 
C) prices rise. 
D) none of the statements associated with this question are correct. 
A) accounting profits increase. 
B) economic profits decrease. 
C) prices rise. 
D) none of the statements associated with this question are correct.

Question 9

If the interest rate is 3%, the present value of $900 received at the end of 4 years is:

Accepted Answer

A) $792.00 
B) $799.64. 
C) $873.79. 
D) $927.40 
A) $792.00 
B) $799.64. 
C) $873.79. 
D) $927.40

Question 10

Managerial economics

Accepted Answer

A) has little to say about day-to-day decisions. 
B) is valuable to the coordinator of a shelter for the homeless. 
C) is not relevant for managers of "not-for-profit" groups. 
D) is the study of how to get rich in the stock market. 
A) has little to say about day-to-day decisions. 
B) is valuable to the coordinator of a shelter for the homeless. 
C) is not relevant for managers of "not-for-profit" groups. 
D) is the study of how to get rich in the stock market.

Question 11

A potential entrepreneur is trying to decide whether to open a new health spa.She presently makes $35,000 per year as an aerobics instructor and will have to give up this job if she opens the new health spa.If she chooses to open the spa, it will cost her $200,000 per year in rent and other operating expenses.
a.What are her accounting costs?
b.What are her opportunity costs?
c.How much would she need to make in revenues to earn positive accounting profits? Positive economic profits?

Accepted Answer

a.Accounting costs equal $200,000 per ye

Question 12

If you put $700 in a savings account at an interest rate of 3%, how much money will you have in one year?

Accepted Answer

A) $370. 
B) $679.61. 
C) $703.00. 
D) $721. 
A) $370. 
B) $679.61. 
C) $703.00. 
D) $721.

Question 13

Which of the following is the main goal of a continuing company?

Accepted Answer

A) to maximize the value of the firm. 
B) to minimize costs. 
C) to improve product quality. 
D) to enhance the service to its customers. 
A) to maximize the value of the firm. 
B) to minimize costs. 
C) to improve product quality. 
D) to enhance the service to its customers.

Question 14

The second-order condition for maximizing net benefits is

Accepted Answer

A) d2N/dQ2 2B/dQ2 2C/dQ2. 
D) all of the statements associated with this question are correct. 
A) d2N/dQ2 2B/dQ2 2C/dQ2. 
D) all of the statements associated with this question are correct.

Question 15

Suppose total benefits and total costs are given by B(Y) = 100Y - 8Y2 and C(Y) = 10Y2.What level of Y will yield the maximum net benefits?

Accepted Answer

A) 75/36. 
B) 75/18. 
C) 50/18. 
D) 100/36. 
A) 75/36. 
B) 75/18. 
C) 50/18. 
D) 100/36.

Question 16

Other things equal, the greater the interest rate:

Accepted Answer

A) the lower the NPV. 
B) the higher the NPV. 
C) the higher the PV. 
D) none of the statements associated with this question are correct. 
A) the lower the NPV. 
B) the higher the NPV. 
C) the higher the PV. 
D) none of the statements associated with this question are correct.

Question 17

If the interest rate is 5%, $10 received at the end of 7 years is worth how much today?

Accepted Answer

A) 100/(0.05)7. 
B) 100/(1 + 0.05)7. 
C) 100/(1 + 5)7. 
D) 100. 
A) 100/(0.05)7. 
B) 100/(1 + 0.05)7. 
C) 100/(1 + 5)7. 
D) 100.

Question 18

If the interest rate is 7%, $500 received at the end of 9 years is worth how much today?

Accepted Answer

A) 500/(0.07)9. 
B) 500/(1 + .07)9. 
C) 500/(1 + 7)9. 
D) 500. 
A) 500/(0.07)9. 
B) 500/(1 + .07)9. 
C) 500/(1 + 7)9. 
D) 500.

Question 19

-What is the marginal revenue of producing the third unit?

Accepted Answer

A) 250. 
B) 70. 
C) 0. 
D) 90. 
A) 250. 
B) 70. 
C) 0. 
D) 90.

Question 20

The opportunity cost of receiving ten dollars in the future as opposed to getting that ten dollars today is:

Accepted Answer

A) the foregone interest that could be earned if you had the money today. 
B) the taxes paid on any earnings. 
C) the value of $10 relative to the total income of that person. 
D) the value of $10 relative to the total income of all persons. 
A) the foregone interest that could be earned if you had the money today. 
B) the taxes paid on any earnings. 
C) the value of $10 relative to the total income of that person. 
D) the value of $10 relative to the total income of all persons.

Economic profits are:

The first-order condition for maximizing net benefits is

The additional benefits that arise by using an additional unit of the managerial control variable is defined as the:

If the interest rate is five percent, the present value of $200 received at the end of five years is:

-What is the marginal cost associated with producing three units of the control variable, Q (identify point E in the above table)?

In order to maximize net benefits, the managerial control variable should be used up to the point where:

As more firms enter an industry

If the interest rate is 3%, the present value of $900 received at the end of 4 years is:

Managerial economics

If you put $700 in a savings account at an interest rate of 3%, how much money will you have in one year?

Which of the following is the main goal of a continuing company?

The second-order condition for maximizing net benefits is

Suppose total benefits and total costs are given by B(Y) = 100Y - 8Y² and C(Y) = 10Y².What level of Y will yield the maximum net benefits?

Other things equal, the greater the interest rate:

If the interest rate is 5%, $10 received at the end of 7 years is worth how much today?

If the interest rate is 7%, $500 received at the end of 9 years is worth how much today?

-What is the marginal revenue of producing the third unit?

The opportunity cost of receiving ten dollars in the future as opposed to getting that ten dollars today is:

Market Forces: Demand and Supply

Quantitative Demand Analysis

The Theory of Individual Behavior

The Production Process and Costs

The Organization of the Firm

The Nature of Industry

Managing in Competitive, Monopolistic, and Monopolistically Competitive Markets

Basic Oligopoly Models

Game Theory: Inside Oligopoly

Pricing Strategies for Firms With Market Power

The Economics of Information

Advanced Topics in Business Strategy

A Managers Guide to Government in the Marketplace

Filters

Exam 1: The Fundamentals of Managerial Economics

Economic profits are:

The first-order condition for maximizing net benefits is

The additional benefits that arise by using an additional unit of the managerial control variable is defined as the:

If the interest rate is five percent, the present value of $200 received at the end of five years is:

-What is the marginal cost associated with producing three units of the control variable, Q (identify point E in the above table)?

In order to maximize net benefits, the managerial control variable should be used up to the point where:

As more firms enter an industry

If the interest rate is 3%, the present value of $900 received at the end of 4 years is:

Managerial economics

If you put $700 in a savings account at an interest rate of 3%, how much money will you have in one year?

Which of the following is the main goal of a continuing company?

The second-order condition for maximizing net benefits is

Suppose total benefits and total costs are given by B(Y) = 100Y - 8Y2 and C(Y) = 10Y2.What level of Y will yield the maximum net benefits?

Other things equal, the greater the interest rate:

If the interest rate is 5%, $10 received at the end of 7 years is worth how much today?

If the interest rate is 7%, $500 received at the end of 9 years is worth how much today?

-What is the marginal revenue of producing the third unit?

The opportunity cost of receiving ten dollars in the future as opposed to getting that ten dollars today is:

Market Forces: Demand and Supply

Quantitative Demand Analysis

The Theory of Individual Behavior

The Production Process and Costs

The Organization of the Firm

The Nature of Industry

Managing in Competitive, Monopolistic, and Monopolistically Competitive Markets

Basic Oligopoly Models

Game Theory: Inside Oligopoly

Pricing Strategies for Firms With Market Power

The Economics of Information

Advanced Topics in Business Strategy

A Managers Guide to Government in the Marketplace

Filters

Suppose total benefits and total costs are given by B(Y) = 100Y - 8Y² and C(Y) = 10Y².What level of Y will yield the maximum net benefits?