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Macro Sample Test _2 Ch 2,3

Macro Sample Test _2 Ch 2,3 - MacroTest#2Ch2,3 Student 1....

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Macro Test #2 Ch 2,3 Student: ___________________________________________________________________________ 1. Which statement best describes a capitalist economy? A. The production of goods and services is determined primarily by markets, but the allocation of goods and services is determined primarily by government B. The production of goods and services is determined primarily by government, but the allocation of goods and services is determined primarily by markets C. The production and allocation of goods and services is determined primarily through markets D. The production and allocation of goods and services is determined primarily through government 2. A characteristic of centrally planned economies is that: 3. As new firms enter an expanding industry: The following table illustrates alternative production techniques for producing 18 widgets that can be sold for $1 each for a total revenue of $18.
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4. You have a choice of 4 techniques above to produce your product, what is the maximum economic profit that can be obtained? 5. Refer to the above table. At the $3 price for labor the most efficient technique will result in an: A. Economic loss of $2 B. Economic profit of $l C. Economic profit of $2 D. Economic profit of $3 6. Firms will tend to enter an industry when:
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