sp04-2 - University of Colorado at Denver, Spring 2004...

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University of Colorado at Denver, Spring 2004 Principles of Economics: Macroeconomics Econ 2012 Instructor: Vijaya Sharma, Ph.D. Exam 2 Choose the best answer for each of the 40 multiple-choice questions in this test. 1. Market failure cases refer to the cases in which a market does not a. produce/deliver the efficient quantity of a good. b. equitably distribute a good among rich and poor people. c. produce the efficient quantity and also does not equitably distribute a good. d. fail to produce the efficient quantity of a good. 2. When there is imperfect competition, market output is expected to be ____________. a. efficient b. higher than the efficient level c. lower than the efficient level d. uncertain 3. Market demand of a public good is derived from the ________________ of individual demand curves. a. horizontal summation b. vertical summation c. parallel summation d. product 4. Free riding of a public good occurs because a. nonpayers cannot be excluded from consuming it. b. a public good costs nothing to produce and provide. c. it is immoral to pay for public goods. d. public goods have no value to people. 5. Which is the best example of a public good? a. the Disney World amusement park b. a textbook in economics c. an emergency warning siren installed on top of the tallest building in your campus d. garbage collection by a waste collection agency 6. A public good is a. a good produced by the government. b. available for simultaneous consumption by more than one person. c. produced by private firms but financed by the government. d. consumed by private individuals and financed by public contributions.
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7. The noise of loud music coming from the neighbor's house is distracting a boy who is preparing for the next day exam. This is an example of ________________. a. public good b. imperfect competition c. positive externalities d. negative externalities 8. GDP of a country is a measure of its _____________. a. inflation b. total unemployment c. total output d. income earned abroad 9. Which best illustrates the difference between GDP and GNP? a. GDP is the dollar amount of final goods consumed by citizens of a country, while GNP is the dollar amount of final goods exported to other countries. b. GDP is the dollar amount of final goods produced by citizens within a country, while GNP is the dollar amount of final goods produced by foreigners within a country. c. GDP is the dollar amount of final goods produced by citizens of a country, while GNP is the dollar amount of final goods produced within the borders of a country. d. GDP is the dollar amount of final goods produced within the borders of a country, while GNP is the dollar amount of final goods produced by citizens of a country. 10. Which is not counted in GDP?
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This note was uploaded on 02/07/2011 for the course ECON 3461 taught by Professor Spencer during the Spring '10 term at Golden West College.

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sp04-2 - University of Colorado at Denver, Spring 2004...

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