Question: Contrast the outcomes of the Standard Oil

> The key to efficient resource allocation is shifting resources from low-productivity to high-productivity uses. In view of the high and expanding physical productivity of agricultural resources, explain why many economists want to divert additional resou

> Which of the following is the correct name for the idea that certain firms prefer government regulation because regulation shields them from the pressures of competition and, in effect, guarantees them a regulated profit? a. The public interest theory o

> True or false. Under the “rule of reason” that was established by the Supreme Court in the U.S. Steel case, a monopoly seller should be found guilty of violating antitrust laws even if it is charging low prices to consumers and acting the same way a comp

> Why might one administration interpret and enforce the antitrust laws more strictly than another? How might a change of administrations affect a major monopoly case in progress?

> Identify each of the following taxes as being either progressive or regressive. a. Personal income tax b. Sales taxes c. Payroll taxes d. Property taxes

> What is the most important source of revenue and the major type of expenditure at the federal level?

> Good methods for helping to protect natural resources include: a. Establishing property rights and giving them to local users. b. Encouraging first-come-first-served property rights. c. Teaching people to consider user cost. d. Having the government set

> Eric and Kyle are fishermen with different equipment and, as a result, different costs for catching fish. Eric’s costs for catching fish are $1,000 per ton for the first five tons and then $2,500 per ton for any additional tons. Kyle can harvest fish at

> A community has a nighttime energy demand of 50 megawatts but a peak daytime demand of 75 megawatts. It has the chance to build a 90-megawatt coal-fired plant that could easily supply all of its energy uses even at peak daytime demand. Should it necessar

> Angela puts $1,000 in a savings account that pays 3 percent per year. What is the future value of her money one year from now? a. $970. b. $1,000. c. $1,003. d. $1,030.

> Suppose that the interest rate is 4 percent. What is the future value of $100 four years from now? How much of the future value is total interest? By how much would total interest be greater at a 6 percent interest rate than at a 4 percent interest rate?

> If money is not an economic resource, why is interest paid and received for its use? What considerations account for the fact that interest rates differ greatly on various types of loans? Use those considerations to explain the relative sizes of the inte

> True or false. “To the extent that they succeed in their goals, unions only ever reduce productivity and efficiency.”

> Suppose that there are only three types of fruit sold in the United States. Annual sales are 1 million tons of blueberries, 5 million tons of strawberries, and 10 million tons of bananas. Suppose that of those total amounts, the Sunny Valley Fruit Compan

> What is the estimated size of the union wage advantage? How might this advantage diminish the efficiency with which labor resources are allocated in the economy? Normally, labor resources of equal potential productivity flow from low-wage employment to h

> The market equilibrium wage is currently $12 per hour among hairdressers. At that wage, 17,323 hairdressers are currently employed in the state. The state legislature then sets a minimum wage of $11.50 per hour for hairdressers. If there are no changes t

> Suppose that low‐skilled workers employed in clearing woodland can each clear one acre per month if each is equipped with a shovel, a machete, and a chainsaw. Clearing one acre brings in $1,000 in revenue. Each worker’s equipment costs the worker’s emplo

> Suppose the formerly competing firms in review question 1 form an employers’ association that hires labor as a monopsonist would. Describe verbally the effect on wage rates and employment. Adjust the graph you drew for review question 1, showing the mono

> FreshLeaf is a commercial salad maker that produces “salad in a bag” that is sold at many local supermarkets. Its customers like lettuce but don’t care so much what type of lettuce is included in each bag of salad, so you would expect FreshLeaf’s demand

> Consider a small landscaping company run by Mr. Viemeister. He is considering increasing his firm’s capacity. If he adds one more worker, the firm’s total monthly revenue will increase from $50,000 to $58,000. If he adds one more tractor, monthly revenue

> In each of the following four cases, MRPL and MRPC refer to the marginal revenue products of labor and capital, respectively, and PL and PC refer to their prices. Indicate in each case whether the conditions are consistent with maximum profits for the fi

> The inverted-U theory suggests that R&D expenditures as a percentage of sales __________ with industry concentration after the four-firm concentration ratio exceeds about 50 percent. a. Rise. b. Fall. c. Fluctuate. d. Flat-line.

> Answer the following lettered questions on the basis of the information in this table: a. If the interest-rate cost of funds is 8 percent, what will be the optimal amount of R&D spending for this firm? b. Explain why $20 million of R&D spending

> In an oligopoly, each firm’s share of the total market is typically determined by: a. Scarcity and competition. b. Kinked demand curves and payoff matrices. c. Homogeneous products and import competition. d. Product development and advertising.

> Both antitrust policy and industrial regulation deal with monopoly. What distinguishes the two approaches? How does government decide to use one form of remedy rather than the other?

> Explain the general meaning of the following profit payoff matrix for oligopolists C and D. All profit figures are in thousands. a. Use the payoff matrix to explain the mutual interdependence that characterizes oligopolistic industries. b. Assuming no

> Suppose a country’s total output is growing 10 percent per year but its population is growing 11 percent per year. What will happen to living standards? a. Remain the same. b. Fall. c. Rise.

> Explain how each of the following can be obstacles to the growth of income per capita in the DVCs: lack of natural resources, large populations, low labor productivity, poor infrastructure, and capital flight.

> The exchange rate between the U.S. dollar and the British pound starts at $1 = £0.5. It then changes to $1 = £0.75. Given this change, we would say that the U.S. dollar has _________ while the British pound has _____________. a. Depreciated; appreciated

> Refer to following table, in which Qd is the quantity of yen demanded, P is the dollar price of yen, Qs is the quantity of yen supplied in year 1, and Qs' is the quantity of yen supplied in year 2. All quantities are in billions and the dollar-yen exchan

> What do the plus signs and negative signs signify in the U.S. balance of payments statement? Which of the following items appear in the current account and which appear in the capital and financial account? U.S. purchases of assets abroad; U.S. services

> True or False: If Country B has an absolute advantage over Country A in producing bicycles, it will also have a comparative advantage over Country A in producing bicycles.

> The following hypothetical production possibilities tables are for China and the United States. Assume that before specialization and trade the optimal product mix for China is alternative B and for the United States is alternative U. a. Are comparative

> Explain: “The United States can make certain toys with greater productive efficiency than can China. Yet we import these toys from China.” Relate your answer to the ideas of Adam Smith and David Ricardo.

> True or False. Because older adults have more human capital, they are more likely to migrate to another country than younger adults.

> The city of Joslyn has three sources of revenue: borrowing, proprietary income from running the local electric power utility, and taxes. If it received $10 million from running the electric power utility and borrowed $40 million, how much did it collect

> There is evidence that, other things equal, a 10 percent increase in the number of workers having a particular skill level leads to about a 4 percent decline in wages for workers with that skill level. In addition, this 10-to-4 ratio appears to hold true

> Suppose that the projected lifetime earnings gains from migration exceed the costs of moving. Explain how the decision to move might be reversed when a person considers present value.

> A patient named Jen visits Dr. Jan. Dr. Jan is nearly certain that Jen only has a cold. But because Dr. Jan is afraid of malpractice lawsuits, she orders an extensive battery of tests just to make sure that Jen can never claim—if she turns out to have so

> Preventive care is not always cost effective. Suppose that it costs $100 per person to administer a screening exam for a particular disease. Also suppose that if the screening exam finds the disease, the early detection given by the exam will avert $1000

> Briefly describe the main features of Medicare and Medicaid, indicating how each is financed.

> Suppose that a society contains only two members, a lawyer named Monique and a handyman named James. Five years ago, Monique made $100,000 while James made $50,000. This year, Monique will make $300,000 while James will make $100,000. Which of the follow

> In 2015, many unskilled workers in the United States earned the federal minimum wage of $7.25 per hour. By contrast, average earnings in 2015 were about $23 per hour, and certain highly skilled professionals, such as doctors and lawyers, earned $100 or m

> How does the Gini ratio relate to the Lorenz curve? Why can’t the Gini ratio exceed 1? What is implied about the direction of income inequality if the Gini ratio declines from 0.42 to 0.35? How would one show that change of inequality in the Lorenz diag

> Suppose that the government has been supporting the price of corn. Its free market price is $2.50 per bushel, but the government has been setting a support price of $3.50 per bushel. Which of the following are ways that the government might try to reduce

> Suppose that 10 workers were required in 2010 to produce 40,000 bushels of wheat on a 1,000-acre farm. a. What is the average output per acre? Per worker? b. If in 2020 only 8 workers produce 44,000 bushels of wheat on that same 1,000-acre farm, what wil

> Suppose a tax is such that an individual with an income of $10,000 pays $2,000 of tax, a person with an income of $20,000 pays $3,000 of tax, a person with an income of $30,000 pays $4000 of tax. What is each person’s average tax rate? Is this tax regres

> Explain how each of the following contributes to the farm problem: a. The inelasticity of demand for farm products. b. The rapid technological progress in farming. c. The modest long-run growth in demand for farm commodities. d. The volatility of export

> When confronted with a natural monopoly that restricts output and charges monopoly prices, the two methods that governments have for promoting better outcomes are: a. Public ownership and public regulation. b. Sole proprietorships and public goods. c. A

> The nation of Upstandia uses kroner for money and its tax code is such that a person making 100,000 kroner per year pays 40,000 kroner per year in income taxes; a person making 200,000 kroner per year pays 70,000 kroner per year in income taxes; and a pe

> For tax purposes, “gross income” is all the money a person receives in a given year from any source. But income taxes are levied on “taxable income” rather than gross income. The difference between the two is the result of many exemptions and deductions.

> What are the main categories of government spending? What are the main categories of government revenue?

> After mining 9,273 tons of coal, Blue Sky Mining’s managers note that the marginal cost of mining the next ton of coal would be $40 per ton. They also calculate that the user cost of mining that next ton of coal would be $35. If the market price of coal

> Suppose that Sea Shell oil company (SS) is pumping oil at a field off the coast of Nigeria. At this site, it has an extraction cost of $30 per barrel for the first 10 million barrels it pumps each year and then $60 per barrel for all subsequent barrels t

> Resource consumption per person in the United States is either flat or falling, depending on the resource. Yet living standards are rising due to improvements in technology that allow more output to be produced for every unit of input used in production.

> The main argument put forth by advocates of the single-tax movement was that: a. Taxing only income would make for a more equal society. b. Taxing only land would be very efficient because taxing land does not decrease its supply. c. Taxing only import

> Use a circular flow diagram to show how the allocation of resources and the distribution of income are affected by each of the following government actions. a. The construction of a new high school. b. A 2-percentage-point reduction of the corporate inco

> Which industries and occupations have the highest rates of unionization? Which the lowest? Speculate on the reasons for such large differences.

> Evaluate free pizza as a form of sales promotion in Pepe’s success.

> Why is heterogeneity particularly important to credit card customers?

> How has AXE used line extensions to increase its reach among consumers?

> How does international marketing differ from domestic marketing?

> Why are younger generations attracted to AXE products?

> How has AXE managed its product mix?

> What are the benefits and disadvantages of test marketing?

> What methods would you use to evaluate the effectiveness of your advertising campaign?

> What class and type of advertising would be most appropriate for your product?

> Why does greenwashing have such a negative impact?

> What are some actions organizations are taking to demonstrate a genuine commitment toward sustainability?

> What are some ways that stakeholders have dissuaded greenwashing?

> Describe Starbucks’ global strategy. Is it engaging in more of a globalization or customization approach?

> Why is product development a cross-functional activity—involving finance, engineering, manufacturing and other functional areas— within an organization?

> Do small companies that manufacture just a few products need to be concerned about developing and managing products? Why or why not?

> Identify and briefly explain the seven major phases of the new-product development process.

> Compare and contrast the three major approaches to modifying a product.

> How does a return on investment pricing objective differ from an objective of increasing market share?

> What factors must marketers consider as they decide whether to engage in international marketing?

> What is a line extension, and how does it differ from a product modification?

> What type of organization might use a venture team to develop new products? What are the advantages and disadvantages of such a team?

> What role does word of mouth play in Pepe’s integrated marketing communications?

> What types of problems does a weak product cause in a product mix? Describe the most effective approach for avoiding such problems.

> What is product positioning? Under what conditions would head-to-head product positioning be appropriate? When should head-to-head positioning be avoided?

> Explain how the term quality has been used to differentiate products in the automobile industry in recent years. What are some makes and models of automobiles that come to mind when you hear the terms high quality and poor quality?

> What is product differentiation, and how can it be achieved?

> Why can the process of commercialization take a considerable amount of time?

> Why is it so important for Caterpillar to develop new products on a regular basis?

> What are some of the benefits and risks of Caterpillar’s line extensions?

> Why do customers associate price with quality? When should prestige pricing be used?

> Why is Caterpillar so careful to test-market its products prior to commercialization?

> Are price leaders a realistic approach to pricing? Explain your answer.

> When GaGa began adding novelty bars in new flavors, what was the effect on the width and depth of its product mix?

> What forms of interpersonal communication besides language can be used in personal selling?

> Why is packaging particularly important for a company like GaGa, which can’t afford advertising?

> Do you think GaGa’s SherBetter pints and bars are likely to follow the product life cycle of traditional ice cream products? Explain your answer.

> How do industry profits change as a product moves through the four stages of its life cycle?

> Is a personal computer sold at a retail store a consumer product or a business product? Defend your answer.

> How does branding benefit consumers and marketers?

> What are the stages in the product adoption process, and how do they affect the commercialization phase?

> Why are the largest industrial corporations in the United States so committed to international marketing?

> How does an organization’s product mix relate to its development of a product line? When should an enterprise add depth to its product lines rather than width to its product mix?