Question 1

The difference between marginal benefits and marginal costs are the:

Accepted Answer

A) profits. 
B) marginal net benefits. 
C) opportunity cost. 
D) accounting cost. 
A) profits. 
B) marginal net benefits. 
C) opportunity cost. 
D) accounting cost.

Question 2

AMS recently instituted an in-house recycling program.The benefits of this program include not only the benefits to the environment of recycling but also the goodwill generated by AMS's leadership in this area.The costs of recycling include all of the energy, labor, and space required to do the recycling.Suppose these benefits and costs are given by

Accepted Answer

@#IMG-DLM& and @#IMG-DLM& (Note that @#IMG-DLM& , and @#IMG-DLM& )
a.What level

Question 3

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

Accepted Answer

A) 4. 
B) 80. 
C) 7.75. 
D) 40. 
A) 4. 
B) 80. 
C) 7.75. 
D) 40.

Question 4

A firm will maximize the present value of future profits by maximizing current profits when the:

Accepted Answer

A) growth rate in profits is constant. 
B) growth rate in profits is larger than the interest rate. 
C) interest rate is larger than the growth rate in profits and both are constant. 
D) growth rate and interest rate are constant and equal. 
A) growth rate in profits is constant. 
B) growth rate in profits is larger than the interest rate. 
C) interest rate is larger than the growth rate in profits and both are constant. 
D) growth rate and interest rate are constant and equal.

Question 5

The change in net benefits that arise from a one unit change in quantity is the:

Accepted Answer

A) marginal net benefits. 
B) total net benefits. 
C) variable benefits. 
D) present value benefits. 
A) marginal net benefits. 
B) total net benefits. 
C) variable benefits. 
D) present value benefits.

Question 6

In the Wealth of Nations, Adam Smith argues that:

Accepted Answer

A) self-interest leads to the efficient allocation of resources. 
B) benevolence leads to the efficient allocation of resources. 
C) profits are maximized where marginal revenue equals net marginal benefits. 
D) none of the statements associated with this question are correct. 
A) self-interest leads to the efficient allocation of resources. 
B) benevolence leads to the efficient allocation of resources. 
C) profits are maximized where marginal revenue equals net marginal benefits. 
D) none of the statements associated with this question are correct.

Question 7

You are a strong advocate for a one-year investment project that would cost your firm $10,000 today, but generate virtually certain earnings of $15,000 at year-end.Those in your firm's financial group concur that the investment is virtually risk-free, but nonetheless your boss is concerned about the firm's cash flow problems.In fact, the problems are so severe that the firm's bank currently charges it 20 percent on one-year loans.Convince your boss to undertake the project.

Accepted Answer

The net present value of the investment

Question 8

Which of the following is an implicit cost of going to college?

Accepted Answer

A) tuition. 
B) cost of books and supplies. 
C) room and board. 
D) foregone wages. 
A) tuition. 
B) cost of books and supplies. 
C) room and board. 
D) foregone wages.

Question 9

Compute the present value of a perpetual bond that pays a monthly cash flow of $1,000 at an annual interest rate of 12 percent.

Accepted Answer

A) $8,333.33. 
B) $9,333.33. 
C) $100,000. 
D) $101,000. 
A) $8,333.33. 
B) $9,333.33. 
C) $100,000. 
D) $101,000.

Question 10

As the interest rate increases, the opportunity cost of waiting to receive a future amount:

Accepted Answer

A) increases. 
B) decreases. 
C) may rise or fall. 
D) remains the same. 
A) increases. 
B) decreases. 
C) may rise or fall. 
D) remains the same.

Question 11

Consumer-consumer rivalry:

Accepted Answer

A) increases the negotiating power of consumers in the market place. 
B) reduces the negotiating power of producers in the market place. 
C) reduces the negotiating power of consumers in the market place. 
D) increases the likelihood of government intervention in the market place. 
A) increases the negotiating power of consumers in the market place. 
B) reduces the negotiating power of producers in the market place. 
C) reduces the negotiating power of consumers in the market place. 
D) increases the likelihood of government intervention in the market place.

Question 12

The optimal amount of studying is determined by comparing:

Accepted Answer

A) marginal benefit and the total cost of studying. 
B) marginal benefit and the total benefit of studying. 
C) marginal benefit and the marginal cost of studying. 
D) total benefit and the total cost of studying. 
A) marginal benefit and the total cost of studying. 
B) marginal benefit and the total benefit of studying. 
C) marginal benefit and the marginal cost of studying. 
D) total benefit and the total cost of studying.

Question 13

Which is the correct statement about the relationship between government and the market?

Accepted Answer

A) Government should intervene on the consumers' behalf. 
B) Government should intervene on the producers' behalf. 
C) Government should not intervene on any party's behalf. 
D) Government often plays a role in disciplining the market process. 
A) Government should intervene on the consumers' behalf. 
B) Government should intervene on the producers' behalf. 
C) Government should not intervene on any party's behalf. 
D) Government often plays a role in disciplining the market process.

Question 14

The Taxpayer Relief Act of 1997 created the Roth IRA, which permits qualifying individuals to make after-tax retirement contributions of up to $2,000 annually.Contributions to a Roth IRA are not tax-deductible, but no taxes are paid on earnings generated from a Roth IRA.In contrast, contributions made to traditional IRAs are tax-deductible, but individuals will pay taxes on all future distributions.In short, investors using the Roth IRA make contributions that have already been taxed and have earnings that grow tax-free, while those using the traditional IRAs defer taxes until funds are withdrawn.Consider an individual who is five years away from retirement and will need to withdraw all her retirement funds at that time.She has $2,000 in pretax income to allocate each year to a retirement plan, faces a fixed tax rate of 15 percent now as well as at retirement, and anticipates a stable 8 percent return on her investments.She can set up a Roth IRA for a one-time, up-front fee of $10, or she can set up a traditional IRA for free.Which option should she choose?

Accepted Answer

If she invests $2,000 in pre-tax money e

Question 15

Because of producer-producer rivalry, the price will tend to:

Accepted Answer

A) be driven to a lower price. 
B) rise up to the maximum price the consumers are willing and able to pay. 
C) be the same as the competitive price. 
D) be the same as the monopoly price. 
A) be driven to a lower price. 
B) rise up to the maximum price the consumers are willing and able to pay. 
C) be the same as the competitive price. 
D) be the same as the monopoly price.

Question 16

Suppose B(Q) = 5Q - Q2 and C(Q) = 1 + Q2.Then, net benefits are ______ when Q equals __________ units since the second-order condition is ______________.

Accepted Answer

A) maximized; 5/4; negative 
B) minimized; -1; positive 
C) maximized; 4/5; positive 
D) minimized; 4/5; negative 
A) maximized; 5/4; negative 
B) minimized; -1; positive 
C) maximized; 4/5; positive 
D) minimized; 4/5; negative

The difference between marginal benefits and marginal costs are the:

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

A firm will maximize the present value of future profits by maximizing current profits when the:

The change in net benefits that arise from a one unit change in quantity is the:

In the Wealth of Nations, Adam Smith argues that:

Which of the following is an implicit cost of going to college?

Compute the present value of a perpetual bond that pays a monthly cash flow of $1,000 at an annual interest rate of 12 percent.

As the interest rate increases, the opportunity cost of waiting to receive a future amount:

Consumer-consumer rivalry:

The optimal amount of studying is determined by comparing:

Which is the correct statement about the relationship between government and the market?

Because of producer-producer rivalry, the price will tend to:

Suppose B(Q) = 5Q - Q² and C(Q) = 1 + Q².Then, net benefits are when Q equals units since the second-order condition 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

The difference between marginal benefits and marginal costs are the:

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

A firm will maximize the present value of future profits by maximizing current profits when the:

The change in net benefits that arise from a one unit change in quantity is the:

In the Wealth of Nations, Adam Smith argues that:

Which of the following is an implicit cost of going to college?

Compute the present value of a perpetual bond that pays a monthly cash flow of $1,000 at an annual interest rate of 12 percent.

As the interest rate increases, the opportunity cost of waiting to receive a future amount:

Consumer-consumer rivalry:

The optimal amount of studying is determined by comparing:

Which is the correct statement about the relationship between government and the market?

Because of producer-producer rivalry, the price will tend to:

Suppose B(Q) = 5Q - Q2 and C(Q) = 1 + Q2.Then, net benefits are ______ when Q equals __________ units since the second-order condition 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 B(Q) = 5Q - Q² and C(Q) = 1 + Q².Then, net benefits are when Q equals units since the second-order condition is __________.