- Which of the following statements is the most appropriate description of gross domestic product (GDP)?A The total income earned by all households, firms, and the government whose value can be verifiedB The total amount spent on all final goods and services produced within the economy during a given periodC The total market value of resalable and final goods and services produced within the economy during a given period
- If companies earn economic profits in a perfectly competitive market, over the long run the supply curve will most likely:A shift to the left.B shift to the right.C remain unchanged.
- A market structure with relatively few sellers of a homogeneous or standardized product is best described as:A oligopoly.B monopoly.C perfect competition.
- The demand schedule in a perfectly competitive market is given by P = 93 - 1.5Q (for Q ≤ 62) and the long-run cost structure of each company is:Total cost: 256 + 2Q + 4Q2 Average cost: 256/Q + 2 + 4Q Marginal cost: 2 + 8QNew companies will enter the market at any price greater than:A 8.B 66.C 81.
- in spite of (in spite n'existe pas sans of)
- Based on typical labor utilization patterns across the business cycle, productiv- ity (output per hours worked) is most likely to be highest:A at the peak of a boom.B into a maturing expansionC at the bottom of a recession.
- Over time, the market share of the dominant company in an oligopolistic mar- ket will most likely:A increase.B decrease.C remain the same.
- the less ... the less ... / the fewer ... the fewer ...
- Aquarius, Inc. is the dominant company and the price leader in its market. One of the other companies in the market attempts to gain market share by under- cutting the price set by Aquarius. The market share of Aquarius will most likely:A increase.B decrease.C stay the same.
- Consider the following data for a hypothetical country:Consumption Capital consumption allowance Government spending ImportsGross private domestic investment Exports15.0 1.5 3.8 1.7 4.0 1.5Based only on the data given, the gross domestic product and national income are respectively closest to:A 21.1 and 20.6.B 22.6 and 21.1.C 22.8 and 20.8.
- During an economic recovery, a lagging unemployment rate is most likely attributable to:A businesses quickly rehiring workers.B new job seekers entering the labor force.C underemployed workers transitioning to higher-paying jobs.
- Which of the following equations is a consequence of the Fisher effect?A Nominal interest rate = Real interest rate + Expected rate of inflation.B Real interest rate = Nominal interest rate + Expected rate of inflation.C Nominal interest rate = Real interest rate + Market risk premium.
- 5 An analyst is interested in assessing both the efficiency and liquidity of Spherion PLC. The analyst has collected the following data for Spherion:FY3 FY2 FY1Days of inventory on hand 32 34 40Days sales outstanding 28 25 23Number of days of payables 40 35 35Based on this data, what is the analyst least likely to conclude?A Inventory management has contributed to improved liquidity.B Management of payables has contributed to improved liquidity.C Management of receivables has contributed to improved liquidity.
- 7 In the Ricardian trade model, a country captures more of the gains from trade if:A it produces all products while its trade partner specializes in one good.B the terms of trade are closer to its autarkic prices than to its partner's autar-kic prices.C the terms of trade are closer to its partner's autarkic prices than to its autar- kic prices.
- 20 What does the P/E ratio measure?A The "multiple" that the stock market places on a company's EPS.B The relationship between dividends and market prices.C The earnings for one common share of stock.
- The characteristic of national consumer price indexes that is most likely shared across major economies worldwide is:A the geographic areas covered in their surveys.B the weights they place on covered goods and services.C their use in the determination of macroeconomic policy.
- 10 Brown Corporation had average days of sales outstanding of 19 days in the most recent fiscal year. Brown wants to improve its credit policies and collec- tion practices and decrease its collection period in the next fiscal year to match the industry average of 15 days. Credit sales in the most recent fiscal year were $300 million, and Brown expects credit sales to increase to $390 million in the next fiscal year. To achieve Brown's goal of decreasing the collection period, the change in the average accounts receivable balance that must occur is closest to:A +$0.41 million.B -$0.41 million.C -$1.22 million.
- If relative to prior values of their respective indicators, the inventory-sales ratio has risen, unit labor cost is stable, and real personal income has decreased, it is most likely that a peak in the business cycle:A has occurred.B is just about to occur.C will occur sometime in the future.
- 20 Which of the following international trade organizations regulates cross-border exchange among nations on a global scale?A World Bank Group (World Bank).B World Trade Organization (WTO).C International Monetary Fund (IMF).
- 8 An analyst observes a decrease in a company's inventory turnover. Which of the following would most likely explain this trend?A The company installed a new inventory management system, allowing more efficient inventory management.B Due to problems with obsolescent inventory last year, the company wrote off a large amount of its inventory at the beginning of the period.C The company installed a new inventory management system but expe- rienced some operational difficulties resulting in duplicate orders being placed with suppliers.