ECO 365 Final Exam | ECO 365 Final Exam Answers | ECO 365 Final Exam Analysis - UOP E Tutors

Suppose foreign shrimp prices drop by 32
percent and importers gain a 90 percent market
share. From this information, what would
economists strongly suspect about this
industry?
Foreigners have a comparative advantage in
shrimping.
The large sales of foreigners indicate they are
better strategic business bargainers than
Americans are.
Americans have a comparative advantage in
shrimping.
Foreign sellers probably are colluding on price to
maximize profits.
2). For a monopolist, the price of a product:
Is less than the marginal revenue.
Exceeds the marginal revenue.
Equals the marginal cost.
Equals the marginal revenue.

3). When Ross Perot ran for president as a third
party candidate in 1992, he argued that free trade
with Mexico would result in massive job losses
in the United States because Mexican wages
were so low. Which of the following is the best
explanation of why few economists agreed with
Perot?
Although economics predicted that
unemployment would rise, the increased profits
of corporations would raise stock prices enough
to compensate for the lost jobs.
Economists did not believe any jobs would be
lost in the United States.
Although economists believed that in some
areas the United States would lose jobs, they
expected the United States would gain jobs in
other areas.
Economics believed that the U.S. unemployment
would rise.
4). Mr. Woodward’s cabinet shop is experiencing
rapid growth in sales. As sales have increased,
Mr. Woodward has found it necessary to hire
more workers. However, he has observed that

doubling the number of workers has less than
doubled his output. What is the likely
explanation?
The law of demand
The law of diminishing marginal productivity
The law of supply
The law of diminishing marginal utility
5). Price elasticity of demand is the:
Change in the quantity of a good demanded
divided by the change in the price of that good.
Percentage change in price of that good divided
by the percentage change in the quantity of that
good demanded.
Percentage change in quantity of a good
demanded divided by the percentage change in
the price of that good.
Change in the price of a good divided by the
change in the quantity of that good demanded.

6). Which of the following statements is true
about a downward-sloping demand curve that is
a straight line?
The slope remains the same, but elasticity falls
as you move down the demand curve.
The slope remains the same, but elasticity rises
as you move down the demand curve.
The slope and the elasticity fall as you move
down the demand curve.
The slope and elasticity are the same at all
points.
7). Strategic decision making is most important
in:
Monopolistically competitive markets.
Monopolistic markets.
Oligopolistic markets.
Competitive markets.
8). Cartels are organizations that:
Encourage price wars.

Keep markets contestable.
Use predatory pricing to monopolize industries.
Coordinate the output and pricing decisions of a
group of firms.
9). Microeconomics and macroeconomics are:
Interrelated because what happens in the
economy as a whole is based on individual
decisions.
Interrelated because both are often taught by
the same instructors.
Not related because they are taught separately.
Virtually identical, though one is much more
difficult than the other.
10). Microeconomics is the study of:
a firm's pricing policies
inflation
unemployment
business cycles

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