1.In the long run, a firm in a perfectly competitive industry will supply output only if its total revenue covers

Select one:

accounting costs

opportunity costs

2.The defining characteristic that makes a good a public good is that

Select one:

it is provided by government

it is rival in consumption

it is non-excludable

all of the answers are correct

3.

If the marginal rate of substitution (MRS) of an indifference curve increases the indifference curve will

Select one:

become flatter

become steeper

shift inward

shift outward

4.

Compared to a monopolistic competitor, a monopolist faces

Select one:

a more elastic demand curve

a more inelastic demand curve

a more elastic demand curve at higher prices and a more inelastic demand curve at lower prices

a demand curve with zero price elasticity

5.

When there is an increase in the monopolist’s fixed costs in the short run

Select one:

the average variable cost curve shits upwards

the marginal cost curve shits upwards

the average (total) cost curve shifts upwards

the monopolist decreases output

6.

The Orbiter bus (fare paying public transport managed by the council) in Christchurch is

Select one:

non-excludable and rival

excludable and rival

excludable and sometimes rival

non-excludable and sometimes rival

7.

Using the following functions:

              Qd = 15 – 2P

              Qs = 3P - 6

if a tax of 20 cents is imposed on the market, the Qs + Tax function would become

Select one:

3P - 6.20

3P - 5.40

3P - 6.60

3P - 26

8.

A cooperative equilibrium results when firms

Select one:

choose the best strategy regardless of what other players do

choose the strategy that maximizes the total game payoff

choose the strategy that minimizes the payoff to other players

choose a strategy by random chance

9.

The price that a perfectly competitive firm receives for its output

Select one:

is determined by the interaction of the firm and all of the consumers who buy from the firm

is determined by the interaction of all sellers and all buyers in the firm's market

will not change in response to changes in market demand and supply because the firm is a price taker

will be lowered by the firm in order to sell more output

10.

A supply curve usually has a negative x-axis intercept because

Select one:

price elasticity of supply is usually negative

the supply curve is upward sloping

the firm will not supply goods for free

all of the answers given are correct

Your hospital is considering opening a satellite urgent care center about five miles from your main campus. You have been charged with gathering demographic information that might affect the demand for the center’s services. What data are likely to be relevant? In this forum, list and add All the variables you need, and explain why you need them. Because you are working as a big group, I don't want you to miss anything!

According to Neoclassical economists the following is a means to stimulate economic growth?

government spending to increase demand

high taxes

low taxes

The Phillips curve illustrates a trade-off between ________ and ________.

the natural rate of unemployment rate; the actual unemployment rate

the natural rate of unemployment; inflation

unemployment; inflation

The theory of ________ assumes that individuals will use all information available to them to form the most accurate possible expectations about the future.

答案选项组

rational expectations

Keynesian economics

adaptive expectations

Which of the following more than likely caused housing prices to fall after the media reported about the subprime mortgage crisis?

答案选项组

neoclassical theory

rational expectations

cyclical expectations

From a Keynesian view, during a recession, government investment in physical capital

答案选项组

always generates positive returns to investment.

has no risk of crowding out private investment in physical capital.

helps increase the output and productivity of an economy.

Tax cuts that are explicitly temporary have less impact than permanent ones because

答案选项组

temporary tax cuts are usually smaller than permanent ones.

temporary tax cuts always have less effect on the budget deficit than permanent ones do.

individuals and businesses do not change their behavior very much, since they do not expect the tax cuts to last.

A perfectly competitive firm currently producing 100 units of output has ATC= $6 and AFC = $4. The market price is $3 and is equal to MC. Is the firm currently operating in the short-run or the long-run? Explain why. Discuss if the firm is currently maximizing profits (or equivalently minimizing losses)? Explain if shutting down the business in this current situation would be beneficial for the firm. If firms break even in the long run and earn zero economic profits, would they stay in the business? Explain why.

Suppose that producing a bicycle generates no environmental degradation, while buying and riding a bicycle (consumption) help reduce greenhouse gas emissions. In contrast, producing, buying and driving a car do generate greenhouse gas emissions. Based on this information, for each economic activity, first discuss whether there is externality and what type of externality it is and explain why(e.g., production/consumption of cars/bicycles leads to positive/negative/no production/consumption externality because … … …). When explaining your reasoning, make sure you relate your specific answer to the definition of externalities. Then, for each economic activity given above (e.g., production/consumption of cars/bicycles), compare private costs and benefits with the true cost and benefit to society.

What is the main characteristic of a monopolistically competitive market different from a perfectly competitive market? Discuss the important implications of this difference for a monopolistically competitive firm’s demand (i.e., in regards to its price elasticity or price-cost margin, and the number of consumers), and for its short-run and long-run profits.

what is the tools of risk management for insurance companies ?

What is the main characteristic of a monopolistically competitive market different from a perfectly competitive market? Discuss the important implications of this difference for a monopolistically competitive firm’s demand (i.e., in regards to its price elasticity or price-cost margin, and the number of consumers), and for its short-run and long-run profits.?

Even when there are no externalities in a market, a government may still tax a good such as petrol to earn revenue. Describe what happens to each of the surpluses (including total surplus) in the market for petrol when this occurs, and why.

What elasticity is the market for petrol likely to exhibit? Explain how elasticity influences the impact of the price change on total surplus.

Q4-Part B
Jenny Sun, a new partner with the regional CPA firm of Lind &Link, was recently appointed to the board of directors of
a local civic organization. The chairman of the board of the civic organization is Musk Train, who is also the owner of a
real estate development firm, Trendy Corporation.
Sun was quite excited when Train indicated that his corporation needed an audit and he wished to discuss the matter
with her. During the discussion, Sun was told that Trendy Corporation needed the audit to obtain a substantial amount of
additional financing to acquire another company. Presently, Trendy Corporation is successful, profitable, and committed
to growth. The audit fee for the engagement should be substantial.
Because Trendy Corporation appeared to be a good client prospect, Sun tentatively indicated that Lind &Link wanted to
do the work. Sun then mentioned that Lind &Link’s quality control policies require an investigation of new clients and
approval by the managing partner, Lee Tower.
Sun obtained the authorization of Train to make the necessary inquiries for the new client investigation. Train was found
to be a highly respected member of the community. Also, Trendy Corporation was highly regarded by its banker and its
attorney, and the Dun & Bradstreet report on the corporation reflected nothing negative.
As a final part of the investigation process, Sun contacted Train’s former tax accountant, Bill Turner. Sun was surprised
to discover that Turner did not share the others’ high opinion of Train. Turner related that on an IRS audit 10 years ago,
Train was questioned about the details of a large capital loss reported on the sale of a tract of land to a trust. Train told
the IRS agent that he had lost all the supporting documentation for the transaction, and that he had no way of finding
out the names of the principals of the trust. A search by an IRS auditor revealed that the land was recorded in the name
of Train’s married daughter and that Train himself was listed as the trustee. The IRS disallowed the loss and Train was
assessed a civil fraud penalty. Sun was concerned about these findings, but eventually concluded that Train had
probably matured to a point where he would not engage in such activities.
Required:
a) Present arguments supporting a decision to accept Trendy Corporation as an audit client.
b) Present arguments supporting a decision not to accept Trendy Corporation as an audit client.
c)Assuming that you are Lee Tower, set forth your decision regarding acceptance of the client, identifying those
arguments from part (a) or part (b) that you found most persuasive.

A perfectly competitive firm currently producing 100 units of output has ATC= $6 and AFC = $4. The market price is $3 and is equal to MC. Is the firm currently operating in the short-run or the long-run? Explain why. Discuss if the firm is currently maximizing profits (or equivalently minimizing losses)? Explain if shutting down the business in this current situation would be beneficial for the firm. If firms break even in the long run and earn zero economic profits, would they stay in the business? Explain why.?

Using economic concepts learned in class, economically evaluate a maximum price policy being implemented in Christchurch on the market for residential rental properties. As part of your answer, explain who wins and who loses from the maximum price policy AND WHY. Also explain whether you think the policy should be implemented or not and why/why not.?