Managerial Economics & Business Strategy 10th Edition by Michael Baye Test bank
human nature.
the limited number of suppliers.
the scarcity of goods available.
the dependence of producers upon technology.
References
Multiple Choice Difficulty: 02 Medium Learning Objective: 01-01 Summarize how goals,
constraints, incentives, and market rivalry affect
economic decisions
73.
Award: 1.00 point
74.
Award: 1.00 point
Producer–producer rivalry functions
only when multiple sellers for a product compete in the market.
only when single sellers for a product compete in the market.
regardless of the number of sellers.
even when customers are not scarce.
References
Multiple Choice Difficulty: 02 Medium Learning Objective: 01-01 Summarize how goals,
constraints, incentives, and market rivalry affect
economic decisions
Because of producer–producer rivalry, the price will tend to
be driven to a lower price.
rise up to the maximum price the consumers are willing and able to pay.
be the same as the competitive price.
be the same as the monopoly price.
References
Multiple Choice Difficulty: 02 Medium Learning Objective: 01-01 Summarize how goals,
constraints, incentives, and market rivalry affect
economic decisions
75.
Award: 1.00 point
76.
Award: 1.00 point
Which is the correct statement about the relationship between government and the market?
Government should intervene on the consumers' behalf.
Government should intervene on the producers' behalf.
Government should not intervene on any party's behalf.
Government often plays a role in disciplining the market process.
References
Multiple Choice Difficulty: 01 Easy Learning Objective: 01-01 Summarize how goals,
constraints, incentives, and market rivalry affect
economic decisions
Suppose the growth rate of the firm's profit is 5 percent, the interest rate is 6 percent, and the current profits of the firm
are $80 million. What is the value of the firm?
$89.2 million
$1,413.3 million
$8,480 million
$727.7 million
References
Multiple Choice Difficulty: 03 Hard Learning Objective: 01-05 Apply present value
analysis to make decisions and value assets.
77.
Award: 1.00 point
78.
Award: 1.00 point
Suppose the growth rate of the firm's profit is 5 percent, the interest rate is 6 percent, and the current profits of the firm
are $100 million. What is the value of the firm?
$111.5 million
$1,766.6 million
$10,600 million
$909.1 million
References
Multiple Choice Difficulty: 03 Hard Learning Objective: 01-05 Apply present value
analysis to make decisions and value assets.
Maximizing the present value of all future profits is the same as maximizing current profits if the growth rate in profits is
greater than the interest rate.
less than the interest rate.
equal to the interest rate.
not constant over time.
References
Multiple Choice Difficulty: 02 Medium Learning Objective: 01-07 Identify and apply six
principles of effective managerial decision
making.
79.
Award: 1.00 point
80.
Award: 1.00 point
Marginal benefit refers to
the average benefits that arise by using an additional unit of the managerial control variables.
the additional benefits that arise by using an additional unit of the managerial control variables.
the change in average benefits arising from a change in the control variable.
the change in the control variable as average benefits fall.
References
Multiple Choice Difficulty: 01 Easy Learning Objective: 01-06 Apply marginal analysis
to determine the optimal level of a managerial
control variable.
Generally when calculating profits as total revenue minus total costs, accounting profits are larger than economic
profits because economists take into account
only explicit costs.
only implicit costs.
both explicit and implicit costs.
that both types of profits are always equal because they account for the same costs.
References
Multiple Choice Difficulty: 01 Easy Learning Objective: 01-02 Distinguish economic
versus accounting profits and costs.
81.
Award: 1.00 point
82.
Award: 1.00 point
"Our marginal revenue is greater than our marginal cost at the current production level." This statement indicates that