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ECON 304 FINAL EXAM LATEST 2025 ACTUAL EXAM|
COMPLETE 350 REAL EXAM QUESTIONS AND
CORRECT DETAILED ANSWERS (VERIFIED ANSWERS)
ALREADY GRADED A+
Which of the following orders goods from the most to least demand elastic?Gour - Correct Answer - gourmet coffee, coffee, hot beverages
For which of the following goods is the demand curve likely to be more inelastic? - Correct Answer - salt
The legal, technological, or market forces that discourage or prevent
potential competitors from entering a market are called: - Correct Answer -
barriers to entry
Suppose the local electrical utility, a legal monopoly based on economies of scale, was split into four firms of equal size, with the idea that eliminating the monopoly would promote competitive pricing of electricity. What do you anticipate would happen to prices? - Correct Answer - prices will go up
Which of the items below represent a natural monopoly? - Correct Answer - economies of scale
Which of the items below represent a legal monopoly? - Correct Answer - patent all of the answers are correct (correct) 1 / 4
pg. 2 copyright trademark
A monopolist's demand curve is: - Correct Answer - downward-sloping
In the United States, exclusive patent rights last for: - Correct Answer - 20
years
Consumers will suffer from a monopoly because it will sell a lower quantity in the market, at a higher price, than would have been the case in a perfectly competitive market. - Correct Answer - True
Which the following is a government-enforced barrier to entry? - Correct Answer - patent protection
If Congress reduced the period of patent protection from 20 years to 10 years, what would likely happen to the amount of private research and development? - Correct Answer - research and development would decrease
The specific choices along the budget constraint line show the
combinations of two different goods a person can afford based on their: -
Correct Answer - ability to purchase all of the answers are correct (correct) budget finances
Behavioral economics is the study of how: - Correct Answer - decisions are
impacted by psychology, satisfaction, and budgets 2 / 4
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Consumer surplus equals the: - Correct Answer - value to buyers minus the
amount paid by buyers
Would you expect marginal utility to rise or fall with additional consumption of a good? Why? - Correct Answer - the law of the diminishing marginal utility
A higher price typically causes reduced consumption of the good in question, but it can affect the consumption of other goods as well. - Correct Answer - true
Is it possible for total utility to increase while marginal utility diminishes? - Correct Answer - yes
Total surplus is: - Correct Answer - equal to the producer plus consumer
surplus
Total surplus is represented by an area: - Correct Answer - between the
demand and supply curves up to the point of equilibrium
A tax on a good lead to a higher price to the consumer and causes the budget constraint to pivot left, and consumption is likely to decrease. - Correct Answer - true
Taxes affect market participants by increasing the price paid by the buyer and received by the seller. - Correct Answer - true
To fully understand how taxes affect economic well-being, we must
compare the: - Correct Answer - reduced welfare of buyers and sellers to
the revenue raised by the government 3 / 4
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When a good is taxed, the burden of the tax: - Correct Answer - falls more
heavily on the side of the market that is more inelastic
Who is a price taker in a competitive market? - Correct Answer - both buyers and sellers
For competitive markets, the profit maximizing level of output is where: -
Correct Answer - marginal revenue equals marginal cost.
Firms operating in perfectly competitive markets produce an output level where marginal revenue is equal to marginal cost. - Correct Answer - true
The unique point where supply and demand intersect is called: - Correct
Answer - equilibrium
A decrease in the price of a good will: - Correct Answer - increase quantity
demanded
An increase in the price of a good will: - Correct Answer - decrease quantity
demanded
Which of the following would cause movement along the supply curve for cupcakes? - Correct Answer - a decrease in the price of cupcakes
An increase in demand shifts the demand curve to the left. - Correct Answer - false
The price elasticity of demand measures how much - Correct Answer - quantity demanded responds to a change in price
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