Econ_198_Aut_07_Exam_4 - Introduction to Microeconomics...

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1 Introduction to Microeconomics Allen R. Sanderson Economics 19800 Autumn 2007 FOURTH/FINAL EXAMINATION Name (Please Print): ________________________________________ [42 Points Possible] Part I. Multiple Choice. Circle letter corresponding to your answer. One point each; 21 points total. 1. The biggest check on, or deterrent against, employer discrimination in competitive labor market economies is: a. the threat of legal action. b. the political process. c. the union movement. d. the simple fact that customers would not tolerate it. e. the profit motive. 2. A rare 1913 Liberty Head V nickel (5-cent) coin recently sold for $3 million. The economic explanation for such a high price for a rare object was covered explicitly in: a. Naked Economics. b. an op-ed newspaper column written by your instructor and distributed in class. c. both of your texts (in the end-of-chapter practice questions section). d. The Fatal Equilibrium. e. one of our class handouts from this section of the course. 3. I prefer that the University of Chicago provide my health-care insurance benefits rather than giving me that same dollar amount in cash and letting me buy my own coverage because: a. I would likely tend to underinsure myself if the decision were left up to me. b. I’d rather my employer have to pay for coverage instead of me. c. It eliminates moral hazard problems for me. d. health insurance benefits are not considered taxable income. e. it’s only fair that employers should be responsible for protecting their employees’ health. 4. Direct controls (aka command-and-control methods) on the production of environmental disamenities are thought or considered to be: a. efficient because they lower the transactions costs of regulation. b. inefficient because firms just pass their increased costs onto consumers and don’t absorb any of it themselves. c. inefficient because they don’t take into consideration social costs and social benefits, only private ones. d. efficient and equitable since everyone suffers the same. e. inefficient because they do not minimize the cost of a given amount of pollution abatement. 5. With a “negative income tax” an additional dollar earned in the marketplace by a low-income recipient would cause his/her net disposable income after transfer(s) to: a. decrease by $1; b. decrease but by less than $1. c. decrease and by more than $1. d.
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This test prep was uploaded on 04/07/2008 for the course ECON 198 taught by Professor Sanderson during the Spring '08 term at UChicago.

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Econ_198_Aut_07_Exam_4 - Introduction to Microeconomics...

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