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True / False
1. Once a firm has selected a price for its product, quantity is decided by consumers and their demand curves.
a. True
b. False
ANSWER: True
POINTS: 1
DIFFICULTY: Easy
LEARNING OBJECTIVES: DISC: Supply and demand
NATIONAL STANDARDS: United States - BPROG: Analytic
ACCREDITING STANDARDS: Supply and demand
TOPICS: Price and Quantity: One Decision, Not Two
KEYWORDS: BLOOM’S: Comprehension
2. Price and output decisions are two aspects of the same choice.
a. True
b. False
ANSWER: True
POINTS: 1
DIFFICULTY: Easy
LEARNING OBJECTIVES: DISC: Supply and demand
NATIONAL STANDARDS: United States - BPROG: Analytic
ACCREDITING STANDARDS: Supply and demand
TOPICS: Price and Quantity: One Decision, Not Two
KEYWORDS: BLOOM’S: Comprehension
4. Economists assume that business firms have many goals, and profit maximization is just one of them.
a. True
b. False
ANSWER: False
POINTS: 1
DIFFICULTY: Moderate
LEARNING OBJECTIVES: DISC: Supply and demand
NATIONAL STANDARDS: United States - BPROG: Analytic
© 2016 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed
with a certain product or service or otherwise on a password-protected website for classroom use.
ACCREDITING STANDARDS: Supply and demand
TOPICS: Price and Quantity: One Decision, Not Two
KEYWORDS: BLOOM’S: Comprehension
5. A firm's total profit is the difference between its sales and what it pays out in costs.
a. True
b. False
ANSWER: True
POINTS: 1
DIFFICULTY: Easy
LEARNING OBJECTIVES: DISC: The study of economics, an - DISC: The study of economics, and definitions in
economics
NATIONAL STANDARDS: United States - BPROG: Analytic
ACCREDITING STANDARDS: The study of economics, and defi - The study of economics, and definitions of economics
TOPICS: Total Profit: Keep Your Eye on the Goal
KEYWORDS: BLOOM’S: Knowledge
© 2016 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed
with a certain product or service or otherwise on a password-protected website for classroom use.
ANSWER: True
POINTS: 1
DIFFICULTY: Moderate
LEARNING OBJECTIVES: DISC: The study of economics, an - DISC: The study of economics, and definitions in
economics
NATIONAL STANDARDS: United States - BPROG: Analytic
ACCREDITING STANDARDS: The study of economics, and defi - The study of economics, and definitions of economics
TOPICS: Economic Profit and Optimal Decision Making
KEYWORDS: BLOOM’S: Comprehension
10. A firm that is earning zero economic profit should go out of business.
a. True
b. False
ANSWER: False
POINTS: 1
DIFFICULTY: Moderate
LEARNING OBJECTIVES: DISC: The study of economics, an - DISC: The study of economics, and definitions in
economics
NATIONAL STANDARDS: United States - BPROG: Analytic
ACCREDITING STANDARDS: The study of economics, and defi - The study of economics, and definitions of economics
TOPICS: Economic Profit and Optimal Decision Making
KEYWORDS: BLOOM’S: Comprehension
11. A small business owner who is earning a positive economic profit, no matter how small, is doing better than if she
sold her business and went to work for another firm.
a. True
b. False
ANSWER: True
POINTS: 1
DIFFICULTY: Moderate
LEARNING OBJECTIVES: DISC: The study of economics, an - DISC: The study of economics, and definitions in
economics
NATIONAL STANDARDS: United States - BPROG: Analytic
© 2016 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed
with a certain product or service or otherwise on a password-protected website for classroom use.
ACCREDITING STANDARDS: The study of economics, and defi - The study of economics, and definitions of economics
TOPICS: Economic Profit and Optimal Decision Making
KEYWORDS: BLOOM’S: Comprehension
12. A firm's total revenue is simply the price of its product multiplied by the quantity sold.
a. True
b. False
ANSWER: True
POINTS: 1
DIFFICULTY: Easy
LEARNING OBJECTIVES: DISC: The study of economics, an - DISC: The study of economics, and definitions in
economics
NATIONAL STANDARDS: United States - BPROG: Analytic
ACCREDITING STANDARDS: The study of economics, and defi - The study of economics, and definitions of economics
TOPICS: Economic Profit and Optimal Decision Making
KEYWORDS: BLOOM’S: Comprehension
14. Total revenue cannot be derived from the demand curve or a demand schedule.
a. True
b. False
ANSWER: False
POINTS: 1
DIFFICULTY: Moderate
LEARNING OBJECTIVES: DISC: The study of economics, an - DISC: The study of economics, and definitions in
economics
NATIONAL STANDARDS: United States - BPROG: Analytic
ACCREDITING STANDARDS: The study of economics, and defi - The study of economics, and definitions of economics
TOPICS: Economic Profit and Optimal Decision Making
KEYWORDS: BLOOM’S: Comprehension
15. It can be shown that average revenue and price are always equal.
a. True
b. False
© 2016 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed
with a certain product or service or otherwise on a password-protected website for classroom use.
ANSWER: True
POINTS: 1
DIFFICULTY: Easy
LEARNING OBJECTIVES: DISC: The study of economics, an - DISC: The study of economics, and definitions in
economics
NATIONAL STANDARDS: United States - BPROG: Analytic
ACCREDITING STANDARDS: The study of economics, and defi - The study of economics, and definitions of economics
TOPICS: Economic Profit and Optimal Decision Making
KEYWORDS: BLOOM’S: Knowledge
17. The average revenue curve can also be described as the demand curve.
a. True
b. False
ANSWER: True
POINTS: 1
DIFFICULTY: Moderate
LEARNING OBJECTIVES: DISC: The study of economics, an - DISC: The study of economics, and definitions in
economics
NATIONAL STANDARDS: United States - BPROG: Analytic
ACCREDITING STANDARDS: The study of economics, and defi - The study of economics, and definitions of economics
TOPICS: Economic Profit and Optimal Decision Making
KEYWORDS: BLOOM’S: Comprehension
18. Marginal, average, and total figures are bound together. If any two are known, the third can be calculated.
a. True
b. False
ANSWER: True
POINTS: 1
DIFFICULTY: Moderate
LEARNING OBJECTIVES: DISC: The study of economics, an - DISC: The study of economics, and definitions in
economics
NATIONAL STANDARDS: United States - BPROG: Analytic
ACCREDITING STANDARDS: The study of economics, and defi - The study of economics, and definitions of economics
© 2016 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed
with a certain product or service or otherwise on a password-protected website for classroom use.
TOPICS: Economic Profit and Optimal Decision Making
KEYWORDS: BLOOM’S: Comprehension
19. The addition to total revenue resulting from one more unit of output is called marginal revenue.
a. True
b. False
ANSWER: True
POINTS: 1
DIFFICULTY: Easy
LEARNING OBJECTIVES: DISC: The study of economics, an - DISC: The study of economics, and definitions in
economics
NATIONAL STANDARDS: United States - BPROG: Analytic
ACCREDITING STANDARDS: The study of economics, and defi - The study of economics, and definitions of economics
TOPICS: Economic Profit and Optimal Decision Making
KEYWORDS: BLOOM’S: Knowledge
20. Marginal revenue equals the change in total revenue that is earned by selling one more unit of output.
a. True
b. False
ANSWER: True
POINTS: 1
DIFFICULTY: Easy
LEARNING OBJECTIVES: DISC: Marginal costs & benefits
NATIONAL STANDARDS: United States - BPROG: Analytic
ACCREDITING STANDARDS: Marginal costs & benefits
TOPICS: Economic Profit and Optimal Decision Making
KEYWORDS: BLOOM’S: Comprehension
21. Marginal revenue is the addition to total revenue resulting from the addition of one unit to total output.
a. True
b. False
ANSWER: True
POINTS: 1
DIFFICULTY: Easy
LEARNING OBJECTIVES: DISC: Marginal costs & benefits
NATIONAL STANDARDS: United States - BPROG: Analytic
ACCREDITING STANDARDS: Marginal costs & benefits
TOPICS: Economic Profit and Optimal Decision Making
KEYWORDS: BLOOM’S: Comprehension
24. Marginal cost curves and average cost curves are both purely upward sloping.
a. True
b. False
ANSWER: False
POINTS: 1
DIFFICULTY: Moderate
LEARNING OBJECTIVES: DISC: Marginal costs & benefits
NATIONAL STANDARDS: United States - BPROG: Analytic
ACCREDITING STANDARDS: Marginal costs & benefits
TOPICS: Economic Profit and Optimal Decision Making
KEYWORDS: BLOOM’S: Comprehension
25. Marginal cost is defined by the slope of the total revenue curve.
a. True
b. False
ANSWER: False
POINTS: 1
DIFFICULTY: Easy
LEARNING OBJECTIVES: DISC: Marginal costs & benefits
NATIONAL STANDARDS: United States - BPROG: Analytic
ACCREDITING STANDARDS: Marginal costs & benefits
TOPICS: Economic Profit and Optimal Decision Making
KEYWORDS: BLOOM’S: Comprehension
26. If marginal cost is less than average cost, average cost must fall when more units are produced.
a. True
b. False
ANSWER: True
© 2016 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed
with a certain product or service or otherwise on a password-protected website for classroom use.
POINTS: 1
DIFFICULTY: Moderate
LEARNING OBJECTIVES: DISC: Marginal costs & benefits
NATIONAL STANDARDS: United States - BPROG: Analytic
ACCREDITING STANDARDS: Marginal costs & benefits
TOPICS: Economic Profit and Optimal Decision Making
KEYWORDS: BLOOM’S: Comprehension
27. If marginal cost of an additional unit of output is greater than average cost, then average cost will rise.
a. True
b. False
ANSWER: True
POINTS: 1
DIFFICULTY: Moderate
LEARNING OBJECTIVES: DISC: The study of economics, an - DISC: The study of economics, and definitions in
economics
NATIONAL STANDARDS: United States - BPROG: Analytic
ACCREDITING STANDARDS: The study of economics, and defi - The study of economics, and definitions of economics
TOPICS: Economic Profit and Optimal Decision Making
KEYWORDS: BLOOM’S: Comprehension
30. Average cost equals total cost multiplied by the number of units of output.
© 2016 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed
with a certain product or service or otherwise on a password-protected website for classroom use.
a. True
b. False
ANSWER: False
POINTS: 1
DIFFICULTY: Easy
LEARNING OBJECTIVES: DISC: The study of economics, an - DISC: The study of economics, and definitions in
economics
NATIONAL STANDARDS: United States - BPROG: Analytic
ACCREDITING STANDARDS: The study of economics, and defi - The study of economics, and definitions of economics
TOPICS: Economic Profit and Optimal Decision Making
KEYWORDS: BLOOM’S: Comprehension
31. Total cost equals average cost multiplied by the quantity of output.
a. True
b. False
ANSWER: True
POINTS: 1
DIFFICULTY: Moderate
LEARNING OBJECTIVES: DISC: Costs of production
NATIONAL STANDARDS: United States - BPROG: Analytic
ACCREDITING STANDARDS: Costs of production
TOPICS: Economic Profit and Optimal Decision Making
KEYWORDS: BLOOM’S: Comprehension
32. A firm that sells at a price below average cost is losing money.
a. True
b. False
ANSWER: True
POINTS: 1
DIFFICULTY: Moderate
LEARNING OBJECTIVES: DISC: Costs of production
NATIONAL STANDARDS: United States - BPROG: Analytic
ACCREDITING STANDARDS: Costs of production
TOPICS: Economic Profit and Optimal Decision Making
KEYWORDS: BLOOM’S: Comprehension
34. Given total cost and the quantity of output, marginal cost and average cost can be determined.
a. True
b. False
ANSWER: True
POINTS: 1
DIFFICULTY: Easy
LEARNING OBJECTIVES: DISC: Costs of production
NATIONAL STANDARDS: United States - BPROG: Analytic
ACCREDITING STANDARDS: Costs of production
TOPICS: Economic Profit and Optimal Decision Making
KEYWORDS: BLOOM’S: Comprehension
35. Profits will be maximized when the slope of the total revenue curve and the slope of the total cost curve equal zero.
a. True
b. False
ANSWER: False
POINTS: 1
DIFFICULTY: Moderate
LEARNING OBJECTIVES: DISC: Costs of production
NATIONAL STANDARDS: United States - BPROG: Analytic
ACCREDITING STANDARDS: Costs of production
TOPICS: Economic Profit and Optimal Decision Making
KEYWORDS: BLOOM’S: Comprehension
36. Profits will be maximized when the slope of the total revenue curve and the slope of the total cost curve are equal.
a. True
b. False
ANSWER: True
POINTS: 1
DIFFICULTY: Moderate
LEARNING OBJECTIVES: DISC: Costs of production
NATIONAL STANDARDS: United States - BPROG: Analytic
ACCREDITING STANDARDS: Costs of production
TOPICS: Economic Profit and Optimal Decision Making
KEYWORDS: BLOOM’S: Comprehension
37. Total profit is represented by the vertical distance between a total revenue curve and a total cost curve.
a. True
b. False
ANSWER: True
POINTS: 1
DIFFICULTY: Moderate
LEARNING OBJECTIVES: DISC: Costs of production
NATIONAL STANDARDS: United States - BPROG: Analytic
© 2016 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed
with a certain product or service or otherwise on a password-protected website for classroom use.
ACCREDITING STANDARDS: Costs of production
TOPICS: Economic Profit and Optimal Decision Making
KEYWORDS: BLOOM’S: Comprehension
38. A graph of total profits is always likely to be positively sloped throughout its length.
a. True
b. False
ANSWER: False
POINTS: 1
DIFFICULTY: Easy
LEARNING OBJECTIVES: DISC: Costs of production
NATIONAL STANDARDS: United States - BPROG: Analytic
ACCREDITING STANDARDS: Costs of production
TOPICS: Economic Profit and Optimal Decision Making
KEYWORDS: BLOOM’S: Comprehension
39. If the average cost of a product is $10 per unit and the price is $5, the firm is losing money.
a. True
b. False
ANSWER: True
POINTS: 1
DIFFICULTY: Moderate
LEARNING OBJECTIVES: DISC: Marginal costs & benefits
NATIONAL STANDARDS: United States - BPROG: Analytic
ACCREDITING STANDARDS: Marginal costs & benefits
TOPICS: Marginal Analysis and Maximization of Total Profit
KEYWORDS: BLOOM’S: Comprehension
42. A firm should keep producing output as long as the marginal profit is greater than zero, no matter how small it is.
a. True
b. False
ANSWER: True
POINTS: 1
DIFFICULTY: Moderate
LEARNING OBJECTIVES: DISC: Marginal costs & benefits
NATIONAL STANDARDS: United States - BPROG: Analytic
ACCREDITING STANDARDS: Marginal costs & benefits
TOPICS: Marginal Analysis and Maximization of Total Profit
KEYWORDS: BLOOM’S: Comprehension
43. Marginal profit equals the difference between marginal revenue and marginal cost.
a. True
b. False
ANSWER: True
POINTS: 1
DIFFICULTY: Easy
LEARNING OBJECTIVES: DISC: Marginal costs & benefits
NATIONAL STANDARDS: United States - BPROG: Analytic
ACCREDITING STANDARDS: Marginal costs & benefits
TOPICS: Marginal Analysis and Maximization of Total Profit
KEYWORDS: BLOOM’S: Comprehension
44. Marginal profit equals the difference between marginal revenue and average cost.
a. True
b. False
ANSWER: False
POINTS: 1
DIFFICULTY: Easy
LEARNING OBJECTIVES: DISC: Marginal costs & benefits
NATIONAL STANDARDS: United States - BPROG: Analytic
ACCREDITING STANDARDS: Marginal costs & benefits
TOPICS: Marginal Analysis and Maximization of Total Profit
KEYWORDS: BLOOM’S: Comprehension
45. Marginal profit is the additional profit that accrues to the firm when the output rises by one unit.
a. True
b. False
ANSWER: True
© 2016 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed
with a certain product or service or otherwise on a password-protected website for classroom use.
POINTS: 1
DIFFICULTY: Easy
LEARNING OBJECTIVES: DISC: Marginal costs & benefits
NATIONAL STANDARDS: United States - BPROG: Analytic
ACCREDITING STANDARDS: Marginal costs & benefits
TOPICS: Marginal Analysis and Maximization of Total Profit
KEYWORDS: BLOOM’S: Comprehension
46. If the marginal profit of the next unit is negative, the firm should produce more output in order to generate greater
profit.
a. True
b. False
ANSWER: False
POINTS: 1
DIFFICULTY: Easy
LEARNING OBJECTIVES: DISC: Marginal costs & benefits
NATIONAL STANDARDS: United States - BPROG: Analytic
ACCREDITING STANDARDS: Marginal costs & benefits
TOPICS: Marginal Analysis and Maximization of Total Profit
KEYWORDS: BLOOM’S: Comprehension
47. If a firm's marginal profit is negative, it should reduce its output level.
a. True
b. False
ANSWER: True
POINTS: 1
DIFFICULTY: Moderate
LEARNING OBJECTIVES: DISC: Marginal costs & benefits
NATIONAL STANDARDS: United States - BPROG: Analytic
ACCREDITING STANDARDS: Marginal costs & benefits
TOPICS: Marginal Analysis and Maximization of Total Profit
KEYWORDS: BLOOM’S: Comprehension
48. A firm is generally more interested in marginal profits than in total profits.
a. True
b. False
ANSWER: False
POINTS: 1
DIFFICULTY: Moderate
LEARNING OBJECTIVES: DISC: Marginal costs & benefits
NATIONAL STANDARDS: United States - BPROG: Analytic
ACCREDITING STANDARDS: Marginal costs & benefits
TOPICS: Marginal Analysis and Maximization of Total Profit
KEYWORDS: BLOOM’S: Comprehension
49. A firm should use marginal analysis when making a price-output decision.
© 2016 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed
with a certain product or service or otherwise on a password-protected website for classroom use.
a. True
b. False
ANSWER: True
POINTS: 1
DIFFICULTY: Easy
LEARNING OBJECTIVES: DISC: Marginal costs & benefits
NATIONAL STANDARDS: United States - BPROG: Analytic
ACCREDITING STANDARDS: Marginal costs & benefits
TOPICS: Marginal Analysis and Maximization of Total Profit
KEYWORDS: BLOOM’S: Comprehension
50. A firm that decides to make a price cut assumes that marginal profit is negative.
a. True
b. False
ANSWER: False
POINTS: 1
DIFFICULTY: Moderate
LEARNING OBJECTIVES: DISC: Marginal costs & benefits
NATIONAL STANDARDS: United States - BPROG: Analytic
ACCREDITING STANDARDS: Marginal costs & benefits
TOPICS: Marginal Analysis and Maximization of Total Profit
KEYWORDS: BLOOM’S: Comprehension
54. Profit is maximized at the output at which marginal revenue exceeds marginal cost by the greatest margin.
a. True
b. False
ANSWER: False
POINTS: 1
DIFFICULTY: Easy
LEARNING OBJECTIVES: DISC: Marginal costs & benefits
NATIONAL STANDARDS: United States - BPROG: Analytic
ACCREDITING STANDARDS: Marginal costs & benefits
TOPICS: Marginal Analysis and Maximization of Total Profit
KEYWORDS: BLOOM’S: Comprehension
55. If total profit is maximized, then marginal cost must equal marginal revenue.
a. True
b. False
ANSWER: True
POINTS: 1
DIFFICULTY: Easy
LEARNING OBJECTIVES: DISC: Marginal costs & benefits
NATIONAL STANDARDS: United States - BPROG: Analytic
ACCREDITING STANDARDS: Marginal costs & benefits
TOPICS: Marginal Analysis and Maximization of Total Profit
KEYWORDS: BLOOM’S: Comprehension
58. The rule of equating marginal benefit with marginal cost is proper for economics, but it does not describe the way in
which people make non-economic decisions.
a. True
b. False
ANSWER: False
POINTS: 1
DIFFICULTY: Moderate
LEARNING OBJECTIVES: DISC: Marginal costs & benefits
NATIONAL STANDARDS: United States - BPROG: Analytic
ACCREDITING STANDARDS: Marginal costs & benefits
TOPICS: Generalization: The Logic of Marginal Analysis and Maximization
KEYWORDS: BLOOM’S: Comprehension
59. All business firms should consider their fixed costs in determining the prices they set.
a. True
b. False
ANSWER: False
POINTS: 1
DIFFICULTY: Moderate
LEARNING OBJECTIVES: DISC: Marginal costs & benefits
NATIONAL STANDARDS: United States - BPROG: Analytic
ACCREDITING STANDARDS: Marginal costs & benefits
TOPICS: Generalization: The Logic of Marginal Analysis and Maximization
KEYWORDS: BLOOM’S: Comprehension
60. When a firm's fixed costs increase it should raise its prices in order to maximize profits.
a. True
b. False
ANSWER: False
POINTS: 1
DIFFICULTY: Easy
© 2016 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed
with a certain product or service or otherwise on a password-protected website for classroom use.
LEARNING OBJECTIVES: DISC: Marginal costs & benefits
NATIONAL STANDARDS: United States - BPROG: Analytic
ACCREDITING STANDARDS: Marginal costs & benefits
TOPICS: Generalization: The Logic of Marginal Analysis and Maximization
KEYWORDS: BLOOM’S: Comprehension
61. Any change in a firm's fixed costs will change its profit-maximizing level of output.
a. True
b. False
ANSWER: False
POINTS: 1
DIFFICULTY: Easy
LEARNING OBJECTIVES: DISC: Marginal costs & benefits
NATIONAL STANDARDS: United States - BPROG: Analytic
ACCREDITING STANDARDS: Marginal costs & benefits
TOPICS: Generalization: The Logic of Marginal Analysis and Maximization
KEYWORDS: BLOOM’S: Comprehension
62. In the case study discussed in the chapter, the electronics firm was losing money by selling its calculators at a price
that was below average cost.
a. True
b. False
ANSWER: False
POINTS: 1
DIFFICULTY: Moderate
LEARNING OBJECTIVES: DISC: Marginal costs & benefits
NATIONAL STANDARDS: United States - BPROG: Analytic
ACCREDITING STANDARDS: Marginal costs & benefits
TOPICS: Generalization: The Logic of Marginal Analysis and Maximization
KEYWORDS: BLOOM’S: Comprehension
63. In the case study discussed in the chapter, the electronics firm was actually enhancing its profits by selling calculators
at a price that was below average cost.
a. True
b. False
ANSWER: True
POINTS: 1
DIFFICULTY: Moderate
LEARNING OBJECTIVES: DISC: Marginal costs & benefits
NATIONAL STANDARDS: United States - BPROG: Reflective Thinking - BPROG: Analysis
ACCREDITING STANDARDS: Marginal costs & benefits
TOPICS: Generalization: The Logic of Marginal Analysis and Maximization
KEYWORDS: BLOOM’S: Analysis
64. Firms can make decisions using marginal analysis even if they do not know the shape of a demand curve.
a. True
© 2016 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed
with a certain product or service or otherwise on a password-protected website for classroom use.
b. False
ANSWER: True
POINTS: 1
DIFFICULTY: Moderate
LEARNING OBJECTIVES: DISC: The study of economics, an - DISC: The study of economics, and definitions in
economics
NATIONAL STANDARDS: United States - BPROG: Analytic
ACCREDITING STANDARDS: The study of economics, and defi - The study of economics, and definitions of economics
TOPICS: Generalization: The Logic of Marginal Analysis and Maximization
KEYWORDS: BLOOM’S: Comprehension
65. Firms need to know the shape of a demand curve to use marginal analysis.
a. True
b. False
ANSWER: False
POINTS: 1
DIFFICULTY: Moderate
LEARNING OBJECTIVES: DISC: The study of economics, an - DISC: The study of economics, and definitions in
economics
NATIONAL STANDARDS: United States - BPROG: Analytic
ACCREDITING STANDARDS: The study of economics, and defi - The study of economics, and definitions of economics
TOPICS: Generalization: The Logic of Marginal Analysis and Maximization
KEYWORDS: BLOOM’S: Comprehension
66. Marginal analysis is useful in economics, but not in other areas of life.
a. True
b. False
ANSWER: False
POINTS: 1
DIFFICULTY: Easy
LEARNING OBJECTIVES: DISC: The study of economics, an - DISC: The study of economics, and definitions in
economics
NATIONAL STANDARDS: United States - BPROG: Reflective Thinking - BPROG: Analysis
ACCREDITING STANDARDS: The study of economics, and defi - The study of economics, and definitions of economics
TOPICS: Conclusion: The Fundamental Role of Marginal Analysis
KEYWORDS: BLOOM’S: Analysis
67. The assumption that firms attempt to maximize profits will yield good predictions even if firms sometimes pursue
other goals.
a. True
b. False
ANSWER: True
POINTS: 1
DIFFICULTY: Moderate
LEARNING OBJECTIVES: DISC: The study of economics, an - DISC: The study of economics, and definitions in
economics
© 2016 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed
with a certain product or service or otherwise on a password-protected website for classroom use.
NATIONAL STANDARDS: United States - BPROG: Analytic
ACCREDITING STANDARDS: The study of economics, and defi - The study of economics, and definitions of economics
TOPICS: Conclusion: The Fundamental Role of Marginal Analysis
KEYWORDS: BLOOM’S: Comprehension
70. If a firm's average cost is currently $100, and the marginal cost is $95, then the average cost is currently falling.
a. True
b. False
ANSWER: True
POINTS: 1
DIFFICULTY: Moderate
LEARNING OBJECTIVES: DISC: The study of economics, an - DISC: The study of economics, and definitions in
economics
NATIONAL STANDARDS: United States - BPROG: Analytic
ACCREDITING STANDARDS: The study of economics, and defi - The study of economics, and definitions of economics
TOPICS: Appendix: The Relationships Among Total, Average, and Marginal Data
KEYWORDS: BLOOM’S: Comprehension
71. Most business people calculate marginal cost and marginal revenue to decide how much to produce.
a. True
© 2016 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed
with a certain product or service or otherwise on a password-protected website for classroom use.
b. False
ANSWER: False
POINTS: 1
DIFFICULTY: Moderate
LEARNING OBJECTIVES: DISC: The study of economics, an - DISC: The study of economics, and definitions in
economics
NATIONAL STANDARDS: United States - BPROG: Analytic
ACCREDITING STANDARDS: The study of economics, and defi - The study of economics, and definitions of economics
TOPICS: The Theory and Reality: A Word of Caution
KEYWORDS: BLOOM’S: Comprehension
72. Most consumers in stores use marginal analysis to make their buying decisions.
a. True
b. False
ANSWER: False
POINTS: 1
DIFFICULTY: Moderate
LEARNING OBJECTIVES: DISC: The study of economics, an - DISC: The study of economics, and definitions in
economics
NATIONAL STANDARDS: United States - BPROG: Analytic
ACCREDITING STANDARDS: The study of economics, and defi - The study of economics, and definitions of economics
TOPICS: The Theory and Reality: A Word of Caution
KEYWORDS: BLOOM’S: Comprehension
73. Business people often use "hunches" and intuition to make decisions regarding what to produce.
a. True
b. False
ANSWER: True
POINTS: 1
DIFFICULTY: Moderate
LEARNING OBJECTIVES: DISC: The study of economics, an - DISC: The study of economics, and definitions in
economics
NATIONAL STANDARDS: United States - BPROG: Analytic
ACCREDITING STANDARDS: The study of economics, and defi - The study of economics, and definitions of economics
TOPICS: The Theory and Reality: A Word of Caution
KEYWORDS: BLOOM’S: Comprehension
Multiple Choice
74. Decision making that seeks only solutions that are acceptable is called
a. optimizing.
b. satisficing.
c. benchmarking.
d. maximizing.
ANSWER: b
POINTS: 1
© 2016 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed
with a certain product or service or otherwise on a password-protected website for classroom use.
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alle kanten, in diepe voren ingekneld met hun knieën,
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bronzen koppen, strak en gebukt van ernst, dampten
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verteerde in drogen schroei van zand en lucht. De zon
in z’n vroege Juliglorie daverde hoog in ’t eindloos
blauw, ingeschroeid in kringen van roodviolet licht en
gouden kransen, woelend de lichtende hemelzee
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gloeiende akkers, die in dorre, schorre hette
smachtten naar regen.—