How can a monopoly maintain its single-seller status?
> If a competitive industry is currently losing money, what can be expected to happen to the number of sellers, the price of the product, the volume of output and losses in this industry over time?
> What is the general cause of all recessions? All expansionary phases of the business cycle?
> If a firm is producing where MR =MC, and at that output level TR = $4,500, TC = $5,000, and TVC = $4,000 per week, is the firm making or losing money? How much? Should the firm shut down?
> If a firm has TFC = $2,000 per day, and is currently losing $1,500 per day, should the firm shut down?
> If a profit-maximizing firm is producing an output level in which marginal revenue equals marginal cost, then is this firm earning a profit?
> If a profit-maximizing firm is producing an output level in which marginal revenue exceeds marginal cost, should it produce more, less or the same?
> Assume the supply and demand curves for a good are given by the following equations: Qd = 1000 - 20P ; Qs = 5P. What is the equilibrium price and quantity?
> a. Construct the cost schedule using the data below for a firm operating in the short run. b. Graph the average variable cost, average total cost, and marginal cost curves.
> Why do you think "rock" stars charge concert ticket prices below what they could charge and still sell out their performances?
> What can we say about the demand and supply curves for products which are "free", like matches, toothpicks, and kittens?
> Is the price system a "just" or "fair" way to allocate products? What about medical services?
> Who does the demanding and the supplying in the labor market? The loanable funds market?
> What can you say about the price of campus parking permits if there never seems to be enough places to park even when you have a permit?
> What causes the business cycle?
> Determine the effect on GDP for the following. a. Consumption increases. b. Government spending falls.
> Is it possible for real GDP to increase and there to be no increase in employment?
> Which is a better indicator of growth in job opportunities: an increase in nominal GDP or real GDP?
> How could nominal GDP increase but real GDP remain the same?
> Consider this statement: “Total output starts falling when diminishing returns occur.” Do you agree or disagree? Explain.
> What would happen to GDP if a significant number of house-spouses who were previously staying home to care for their children began taking jobs and placing their children in day-care? Would the nation's well-being necessarily be better off?
> If the illegal drug trade was legalized what would happen to GDP?
> Which of the components of GDP must increase if we are to experience greater rates of economic growth?
> How are price controls related to anti-poverty programs?
> Some people have argued that the American workers' movement would have been more successful in achieving its goals if it would have been more organized across labor markets; if it would have adopted a more European style of creating a "Labor" political p
> Some people have argued: "Any gains made by unions in the form of higher wages will create lower wages for non-unionized workers." Leaving side whether this is actually the case or not, what is the economic logic behind such an argument?
> For each of the following determine the impact on the demand or the supply of labor and the effect on the equilibrium wage and quantity of labor employed. a. An increase in the price of capital. b. A union is formed which uses collective bargaining to ob
> What is the principle strategy of an inclusive (industrial) union in order to increase wages of its members?
> What is the principle strategy of an exclusive (trade) union in order to increase wages of its members?
> How would one calculate the profit an employer earns from the employment of workers?
> Suppose you own a video game store. List some of the fixed inputs and variable inputs you would use in operating the store.
> Why does the supply curve slope upward?
> If males (whites) are paid more than females (blacks) is that proof of discrimination?
> What is the best way to combat poverty over time?
> What are the three major goals of any short-run poverty relief program?
> Typically, how long do those in poverty whom are receiving public assistance (welfare) remain on the welfare roles?
> Based on real-world evidence, what is the profile of a family in poverty?
> Describe how investment in human capital could help solve the poverty problem.
> Why does the demand for labor slope downward?
> What are some strategies that firms use to collude?
> In a non-collusive oligopoly if one firm increased its price what would the other firms likely do? What about a price decrease? How is this related to a kinked demand curve?
> What short-run effect might a decline in the demand for electronic components for automatic teller machines have on Computech’s average total cost curve?
> What effect would a successful advertising campaign differentiating a product from one's competitors have on a monopolistically competitive firm's demand and its elasticity of demand? What does this do to the firm's profits? You may have heard the slogan
> Which market structure do most real world markets approximate?
> What happens to employment opportunities and wages paid in all non-competitive product markets? Why?
> How are the professional sports leagues like a cartel?
> What kind of agreements may cartels work out to reduce competition among themselves?
> How can cartels sow the seeds of their own destruction?
> If a company charges different prices to different customers as a result of differences in providing the product to these different customers then is that price discrimination?
> Why don't monopolists charge the highest possible price market demand will bear?
> What evidence suggests that some government regulation may reduce competition in practice?
> Charles loves Mello Yello and will spend $10 per week on the product no matter what the price. What is his price elasticity of demand for Mello Yello?
> Why does a monopolist produce less and charge a higher price compared to a competitive market?
> How long can a monopoly earn economic profits?
> If a monopoly is losing money then when should it shut down?
> Can a monopoly lose money?
> What are some relevant public policy questions when government considers breaking up a monopoly?
> If a firm has $20,000 in total fixed costs, is producing 100 units, has average total cost equal to $240, then what is its average variable cost of production?
> Why do marginal costs of production rise?
> Is the "best" quantity of workers to hire where the marginal productivity of the last worker employed is the greatest (which implies an output level in which the marginal cost of producing additional units is the cheapest)?
> Many people search out and purchase "bargains" at garage and yard sales. What are some implicit costs associated with this type of shopping?
> Some companies advertise: "We deal in high volume and pass our savings on to you in the form of lower prices." How could this be?
> Will each of the following changes in price cause total revenue to increase, decrease, or remain unchanged? a. Price falls, and demand is elastic. b. Price rises, and demand is elastic. c. Price falls, and demand is unitary elastic. d. Price rises, and d
> How can the extent to which economies or diseconomies of scale are experienced help us to predict the size and number of real-world firms in an industry?
> If a firm wished to minimize its cost of production then what output level should it produce?
> Why does the marginal cost curve intersect the average variable and average total cost curves at their respective minimum points?
> In each of the following situations, indicate who bears the biggest burden of a tax imposed on sellers, consumers or sellers? a. Given supply, demand is quite inelastic? b. Given supply, demand is quite elastic?
> If a firm wants to maximize its revenues then what price should it charge?
> If a firm wishes to increase its revenues and the product it is selling has an inelastic demand, then should the firm increase or decrease its price?
> Why are convenience stores able to charge higher prices than grocery stores for some items?
> What is the advantage of using the midpoints formula as opposed to the total revenue test in determining the degree of price elasticity?
> If good X has a price elasticity of demand equal to 2 and good Y has a coefficient equal to 2.5 which has a more elastic demand?
> If good X has a price elasticity of demand equal to 2 and the price increases by 10 percent then by what percent will the quantity demanded change?
> Consider the following demand schedule: What is the price elasticity of demand between; a. P 5 $25 and P 5 $20? b. P 5 $20 and P 5 $15? c. P 5 $15 and P 5 $10? d. P 5 $10 and P 5 $5? Quantity demanded Elasticity coefficient Price $25 20 20 40 15 60
> What are some additional examples of public goods and services?
> How would an economist answer the question: "What is the appropriate level of government involvement?"
> How does government attempt to correct for an inequitable distribution of income?
> How does government attempt to correct for a lack of competition?
> Why has government been involved in setting prices---price controls?
> Why has the price of most computers and other electronic product been falling over the past several years while the demand for these products has been rising at the same time?
> If demand and supply both increase, but demand increases more than supply increases, then what happens to the equilibrium price and quantity?
> If the price of televisions has increased over the last year and people are buying more televisions, is this an exception to the law of demand, or has there been a change in demand or supply which could account for this?
> Macroeconomic instability can also be viewed as a "market failure." This is because the market system (capitalism) is permissive of the problems of unemployment, inflation and slow rates of economic growth associated with macroeconomic instability. How h
> Is there a "free-rider" problem associated with public goods and services? How does government address this free-rider problem?
> Suppose the price elasticity of demand for farm products is inelastic. If the federal government wants to follow a policy of increasing income for farmers, what type of programs will the government enact?
> Why money isn’t considered capital in economics?
> If the government banned the sale and purchase of a good or service (for example, cigarettes, or abortion services), then what impact would this have on the market for this item.
> What are the necessary ingredients for a nation to experience greater rates of economic growth, higher average standards of living, and a greater ability to compete in the global economy? That is, what could the U.S. do to achieve all this?
> Under what conditions would a nation be able to currently produce more of both consumer and capital products?
> What is the profit-maximizing quantity of output for a firm to produce?
> What is the cost of a new car?
> What is the opportunity cost of attending college?
> How does government affect the answer to the "For Whom" fundamental economic question?
> How does government affect the answer to the "How" fundamental economic question?
> How does government affect the answer to the "What" fundamental economic question?
> What are some problems associated with economic growth?
> Opponents of increasing the tax on gasoline argue that the big oil companies just pass the tax along to the consumers. Do you agree or disagree? Explain your answer.
> What is the relationship between tuition and student enrollment at a university. How would this relationship be graphed?
> What is the relationship between a student's grade point average and the number of hours spent studying per week. How would this relationship be graphed?
> What is the relationship between the annual sale of umbrellas and the annual amount of rainfall received in inches? How would this relationship be graphed?
> Why do leaders of less developed countries often run very large deficits and print entirely too much money creating excessive inflation, even though they are aware of the consequences of their policies? How might these inflationary policies damage these
