Questions:
PART 1
Question 1
Thomas Malthus was:
A) an English clergyman who lived in the early 1800's.
B) one of the earliest economic authors to warn about population growth.
C) a futurist who warned that overpopulation could result in mass starvation.
D) all of the above
Question 2
A manufacturing or service process that creates a negative externality by definition does not have a purely market oriented solution.
A) True
B) False
Question 3
Unintended pregnancies are not one of the primary reasons for overpopulation.
A) True
B) False
Question 4
According to current consumption patterns, solid waste per capita rises dramatically with affluence.
A) True
B) False
Question 5
Women are still culturally and economically repressed in some developed countries.
A) True
B) False
Question 6
Direct valuation relies on prices set in markets or contingent value techniques to to establish value.
A) True
B) False
Question 7
The World Trade Organization has forced some countries to reverse their own domestic laws regarding environmental quality and worker safety.
A) True
B) False
Question 8
In a country where income distribution is heavily skewed towards the top few percent of the population having most of the wealth, the Gini coefficient will be
A) negative.
B) around zero.
C) close to 1.
D) off the charts!
Question 9
The Malthusian prediction that population growth would cause eventual widespread famine has been forestalled by
A) cultivation of more land for agriculture.
B) improvements in the technology of agricultural production.
C) better weather forecasting.
D) increasing number of people becoming farmers.
Question 10
The trend in per capita municipal solid waste in the U.S.
A) has continued to grow exponentially.
B) has been declining since the 1970's.
C) increased in the 1980's, but flattened out in the 1990's and beyond.
D) has remained unchanged for decades.
Question 11
Hedonic pricing means:
A) prices that relate to how much people enjoy something.
B) observing prices in goods and services related to a particular environmental asset.
C) observing prices in goods and services not related to a particular environmental asset.
D) prices that relate to how much people do not enjoy something.
Question 12
One drawback of hedonic pricing is:
A) data on such prices is poorly collected, and therefore unreliable.
B) there is weak theoretical support that such an approach is meaningful.
C) large datasets are typically needed to establish significant relationships between the prices and environmental variables.
D) not much data are actually available.
Question 13
Of the six global environmental issues we studied, the most serious one is
A) ozone depletion
B) greenhouse gases
C) deforestation
D) ocean pollution
Question 14
The "Battle In Seattle" refers to
A) riots against the Vietnam War.
B) an Indian war that happened in the mid-1800's.
C) street protests against the WTO meeting there in 1999.
D) a flash mob that turned into a riot with the police.
Question 15
The two basic approaches to establishing economic value to environmental assets which cannot be valued through conventional (private) markets are
and
Question 16
The theory of demographic transition revolves around two key demographic events in relation to economic progress, which are the rates of
and
, in relation to the stages of economic development.
Question 17
A specialized device that can be used to measure ozone content in the atmosphere, besides satellites, is called a .
Question 18
The six top global environmental issues are (answers can be more than one word): (1)
, (2)
, (3)
, (4)
, (5)
, and (6)
Question 19
The three top global institutions that govern world trade are (use full spellings, not acronyms): (1)
, (2)
, and (3)
Question 20
The most significant international treaty to date about greenhouse gases, but which is due to expire at the end of 2012, is known as the
Question 21
Explain the difference in geometric versus arithmetic growth rates.
Question 23 Explain why David Suzuki does not believe there is a technological solution to global overpopulation, based on his Test Tube Story.
Question 24
What are some of the strategies for moderating the amount of municipal solid waste generated by consumers, businesses and manufacturers?
Question 25
Compare and contrast the precautionary principle and the polluter pays principle as policy approaches to environmental pollution.
Question 26
Explain how economics acquired the term "the dismal science".
PART 2
Question 1
For a perfectly competitive firm, the value of the marginal product of labor falls as more workers are hired because of the diminishing
A) output price.
B) marginal physical product of labor.
C) price of labor.
D) marginal cost of production.
Question 2
The practice of outsourcing has been given a boost by
A) advances in telecommunications and computer networking.
B) firms that are becoming more risk-averse.
C) support from organized labor.
D) sharp increases in the cost of overseas labor.
Question 3
Refer to the above table. If the price of the good produced is $7, the marginal revenue product of the 11th worker is
A) $700
B) $4200
C) $630
D) $3500
Question 4
Ajax Corporation has just decided to let managers work from home one day a week. This decision will make working conditions better and will
A) cause the demand curve for labor for managers to increase.
B) increase the elasticity of demand for labor for managers.
C) lead to an increase in the supply curve of labor for managers.
D) leave the supply curve of labor unchanged.
Question 5
Refer to the above table. What does the marginal revenue product equal when 26 workers are hired a week?
A) $221
B) $8.50
C) $1190
D) $26
Question 6
In a perfectly competitive labor market, the least-cost combination rule for resource use
A) assures the firm an economic profit.
B) requires that resources be used in combinations such that marginal products are equal.
C) requires that the marginal physical product per dollar spent for each resource is equalized.
D) assures the firm a normal profit.
Question 7
Refer to the above table. How many workers will this firm hire if the weekly wage rate is $770?
A) 28
B) 27
C) 26
D) 29
Question 8
In the above table, if the marginal factor cost is $96, how many workers would be hired?
A) 5
B) 4
C) 2
D) 3
Question 9
When U.S. computer companies hire workers in India to staff their customer service call centers, they are engaging in
A) labor engagement.
B) unfair trade practices.
C) outsourcing.
D) predatory pricing.
Question 10
The demand for labor is
A) derived from the satisfaction that hiring the inputs provides the owner or manager of the firm more money.
B) derived from the demand for the final product being produced.
C) derived from a utility maximizing process similar to that used to derive the demand curve for goods and services.
D) totally unrelated to the demand curve for the final product.
Question 11
A firm will not hire additional workers once
A) it earns accounting profits.
B) the additional cost of a worker equals the additional revenue from the worker.
C) total product is rising.
D) the company reaches its breakeven output level.
Question 12
The marginal revenue product is
A) the change in total output resulting from a one-unit change in variable output.
B) the change in marginal output resulting from a one-unit change in variable input.
C) the change in total revenue resulting from a one-unit change in variable input.
D) the change in marginal revenue resulting from a one-unit change in variable input.
Question 13
If you want to become an actor, and you must join the Screen Actors Guild after your first job, the Screen Actors Guild is a(n)
A) union shop.
B) agency shop.
C) closed shop.
D) open shop.
Question 14
If a firm is a union shop, then
A) a non-union worker may be hired but must join the union within a certain time period.
B) only workers who have been union members for two years may be employed.
C) a worker may elect to either join or not join the union.
D) only union members may be employed by the firm.
Question 15
What is it called when the price paid for a variable input is less than its marginal revenue product?
A) Monopolistic exploitation
B) Monopsonistic exploitation
C) Bilateral monopoly
D) Featherbedding
Craft unions exert market control by
Question 16
A) limiting the supply of labor.
B) setting minimum wages.
C) limiting the demand for labor.
D) setting maximum wages.
Question 17
Since the 1970s, union membership in the U.S. has been
A) erratic.
B) remaining constant.
C) declining.
D) rising.
Question 18
Suppose a union successfully negotiates a wage rate for its members that is above the competitive wage rate, then
A) the union must find a way to make union workers more productive.
B) the union must also negotiate a fringe-benefit package that the membership will like.
C) the union must find a way to ration jobs among the excessive number of workers who wish to work at the negotiated wage.
D) employment in the union sector will increase.
Question 19
A bilateral monopoly means
A) that a monopsonistic employer bargains with two unions.
B) that an industrial union bargains with a two-firm oligopoly.
C) that a monopsonistic employer bargains with a monopoly.
D) that a monopsonistic employer bargains with both an industrial and a craft union.
Question 20
A monopsony has an upward sloping supply curve because
A) when more units of labor are hired, only the new workers receive the higher wage.
B) each additional unit of labor costs less.
C) diminishing marginal product to scale does not exist in a monopsony.
D) when more units of labor are hired, all laborers must receive the higher wage.
Question 21
When there is only one buyer in the market,
A) the supply curve for the good will be perfectly elastic.
B) a monopsony exists.
C) a closed shop exists.
D) then the market will be perfectly competitive.
Question 22
A union-sponsored television campaign urging U.S. consumers to "Look for the union label" is designed to
A) raise wages by restricting the supply of union workers.
B) increase the productivity of union labor.
C) remind consumers that if they do not buy union-made goods, unions will strike.
D) increase the derived demand for union labor by shifting consumer preferences in favor of union-made goods.
Question 23
Since 1929, the distribution of money income in the United States has
A) shifted toward the poorer 20 percent away from the richer 20 percent.
B) become slightly more unequal.
C) become more equal.
D) not dramatically changed.
Question 24
In the absence of discrimination, as human capital investments increase, wages will generally
A) increase.
B) increase or decrease.
C) not change.
D) decrease.
Question 25
The more bowed out the Lorenz curve, the
A) less the overall wealth in the economy.
B) greater the overall wealth in the economy.
C) less equal the income distribution.
D) more equal the income distribution.
Question 26
Economic discrimination exists when
A) both income and wealth are unequally distributed in a country.
B) workers with the same marginal revenue products are paid different wages.
C) there is an unequal distribution of income in a country.
D) there is unequal access to education.
Question 27
In a growing economy, it is possible to eliminate
A) relative poverty.
B) both absolute and relative poverty.
C) either absolute nor relative poverty.
D) absolute poverty.
Question 28
An individual with no deductible on his or her health insurance policy will tend to engage in a lifestyle that is less healthy than a person with a $2,000 insurance deductible. This is said to be a problem of
A) wellness training.
B) blue-zoning.
C) moral hazard.
D) healthy selection.
Question 29
The percentage of total national income spent on health care in the United States has
A) declined rapidly since 1965.
B) remained constant over the last few years.
C) risen steadily since 1965.
D) remained below the level of inflation.
Question 30
One reason earnings tend to fall before retirement age is that
A) firms discriminate against older workers.
B) people are retiring earlier.
C) the experience of people is no longer valuable after they are 50 or 55.
D) people tend to reduce the number of hours they work after age 50.
Question 31
In the United States, the distribution of wealth
A) is more equal than the distribution of income.
B) is equal for all families.
C) is the same as the distribution of income.
D) is more unequal than the distribution of income.
Question 32
Relative poverty refers to
A) the number of poor in one state relative to another.
B) poverty levels at a stated income cutoff.
C) how a family's income compares to the incomes of those around them.
D) None of the above.
Question 33
The graph which represents the distribution of income in an economy is called the
A) Lorenz curve.
B) Laffer curve.
C) distribution curve.
D) aggregate demand curve.
Question 34
All of the following are reasons that health care costs have risen so much in the past few decades EXCEPT
A) the aging population.
B) new technologies.
C) higher imports.
D) third party payments.
Question 35
Transaction costs are
A) not true costs because they relate to time rather than real resources.
B) the costs associated with making, reaching, and enforcing agreements.
C) equal to the hourly cost of a lawyer used to write a contract.
D) the costs, such as sales taxes, that are imposed by the government.
Question 36
The optimal quantity of air pollution is
A) found by setting the quantity of air pollution equal to the quantity of water pollution.
B) a meaningless concept since monetary values cannot be attached to problems associated with pollution.
C) found by equating the marginal benefits from further reductions in pollution and the marginal costs of further reductions in pollution.
D) whatever amount of pollution is produced by the profit maximizing firm.
Question 37
The marginal cost curve of pollution abatement
A) slopes downward because of the law of diminishing returns.
B) slopes upward because firms will maximize profits.
C) slopes downward because of the law of diminishing marginal utility.
D) slopes upward because of the law of diminishing product.
Question 38
John raises bees to pollinate his orchard. A couple of bees which escaped ended up pollinating his neighbor's orchard, so
A) John's neighbor has received an external benefit of John's bee-keeping.
B) John's neighbor has received an external cost of John's bee-keeping.
C) John's neighbor has received an internal cost of John's bee-keeping.
D) None of the above is correct.
Question 39
If crop dusting on your farm causes your neighbors to have sore throats, then crop dusting is creating
A) only explicit costs.
B) internal costs.
C) opportunity costs.
D) external costs.
Question 40
When a polluter has to bear the full social cost of their actions, they will
A) go out of business since pollution abatement is expensive.
B) will always decide to reduce the amount of pollution by reducing the quantity they produce.
C) increase the price of the product and the quantity produced to pay for the additional costs.
D) weigh the costs and benefits of each potential action and might decide to not stop polluting by paying a fine.
Question 41
Social costs are
A) costs incurred by government and borne by all taxpayers.
B) costs incurred in governmental welfare programs.
C) external costs minus internal costs.
D) costs borne by society whenever a resource-using action takes place.
Question 42
If pollution is bad, why do we still use pollution-causing resources such as coal and oil to generate electricity?
A) Pollution is only a private cost.
B) The transaction costs of pollution is too low.
C) The cost of using pollution free resources to generate power in many circumstances is much higher than generating that same power through conventional pollution-causing means.
D) Governments lack the political will to enforce the use of pollution free resources.
Question 43
When social costs of an activity exceed private costs
A) there is a tendency for resources to be under-utilized.
B) there is a tendency for resources to be over-utilized.
C) this means that resources are being efficiently used.
D) None of the above is correct.
Question 44
If a person does not pay all costs associated with a particular resource-using activity, then
A) the external costs of the activity are greater than the internal costs of the activity.
B) the full costs of the activity are the sum of private costs plus internal costs.
C) the external costs of the activity are greater than the private costs of the activity.
D) the social costs of the activity are greater than the private costs of the activity.
Question 45
What can cause the demand curve for labor to shift? Explain.
Question 46
Explain the two theories of desired income distribution: the egalitarian principle and the productivity standard.
Question 47
Explain the implications of outsourcing for employment and wages in the domestic and foreign labor markets.
Question 48
Distinguish between craft unions and industrial unions.
QUESTION 49 :
1. If the US is considered one of the wealthiest nations in the world, are there really poor people in the US? How do we define poverty? What is the poverty level (threshold) for a family the size of your own family? Use www.census.gov/hhes/www/poverty.html to help.
2. What factors influence your decisions to work? Are there factors besides income that influence your decision to work? If you were to win a lottery prize of $100,000 per year, would you continue to work?
3. Has the US dollar been relatively strong or weak over the past year? Explain. How does the strength of the dollar impact imports and exports?
4. Explain what types of products the US exports and what types of products we import. Why do you think those are the products we export or import?