Question # 1

Perfect price discrimination means that every customer.

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Buys the same amount

Pays the same price

Pays what she thinks the product is worth

Contributes the same revenue.

The effect of a tax to offset a negative eternality will be to ________ price and ____ quantity.

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Reduce, reduce

increase, increase

Increase , reduce

reduce, increase

When a market is contestable , incumbent firms must.________ to avoid the entry of new competitors.

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Behave like competitive firms

Agree to act together

Differentiate their products

Practice price discrimination

Firms are assumed to ____ costs and to _______ profit.

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Incur , desire

Pay ; make

Change ;earn

Minimize ; maximize

The single European Act committed_ governments to a ___ in 1992

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European union, single market

Western European, single currency area

European union, single currency area

Western European, single market

Market some times fall to exist because of.

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Externalities

the free rider problem

Poor transport

a an b

The theory that explains business cycles by the dynamic interaction of consumption and investment demand is the.

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Sun spect theory

Multiplier accelerator model

Solow theory

New classical theory

Market failure may arise because of.

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Imperfect competition

Taxation

Externalities

All of the above

Real GNP measures income

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Including non market activities

Adjusted for inflation

Including externalities

Including tax evasion

Land will be allocated between competing uses so that.

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Housing gets priority

Industry gets priority

Faming gets priority

The equilibrium rental rate equilibrium total demand with supply

We would normally expect the size of the labour force to be ____ than the number of workers willing to accept job offers at any real wage rate.

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Smaller

Larger

the same size

None of these

The prisoners Dilemma Game demonstrates that.

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Players are better off to act independently

Monopoly is better than competition

People will always cheat

Players are better off if they con operate

If banks and the private sector decide to hold less cash the money multiplier will be.

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Unchanged

Larger

Smaller

unstable

If the government increase spending and raises taxes by just enough to finance the increase it will.

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Leave output unchagned

Increase output

Reduce output

Increase the MPC

Expansionary fiscal policy in the classical model will cause aggregate demand to ______ potential output.

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Exceed

Fall below

Fluclaute around

Remain equal to.

The opportunity cost of acquiring education is.

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Course fees

Course fees and living expenses

The earning foregone

Course fees, living expenses and textbooks

The opportunity cost of a good is.

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The time lost in finding it

The quantity of other goods sacrificed to get another unit of that good

The expenditure on the good

The loss of interest in using savings

All of the following are types of imperfect competition except

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Monopolistic competition

Oligopoly

Monopoly

Unfair competition

The most important source of wage differentiate are.

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Reginal variation

Unionization

Relative danger

Skills

In the EMU a country's competitiveness can change because of.

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Interest rate adjustment

Central bank intervention i the forex

Domestic wage and price adjustment

Devaluations

Aggregate demand without a foreign sector is the sum of.

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c+1

C+G

1+G

C+!+G

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