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Economics MCQ – 50 questions
Question 1
ceiling price of $15 would cause
Select one:
a. A surplus of 800
b. A shortage of 800
c. A surplus of 600
d. A shortage of 600
Question 2
A firm estimated its short-run costs using an average variable cost function of the form
AVC = a + bQ = cQ2 and obtained the following results. Total fixed cost is$1,500.
If the firm produces 20 units of output, what is estimated AVC?
Select one:
a. $48.05
b. $74.05
c. $230.05
d. $242.05
Question 3
A firm estimated it’s short-run costs using an average variable cost function of the form AVC = a + bQ + cQ2 and obtained the following results. Total fixed cost is $1,500
If the firm produces 20 units of output, what is estimated total cost?
Select one:
a. $1,500
b. $1,481
c. $2,981
d. $6,341
Question 4
A firm estimates its long-run production function to be Q = -0.0050 K3L3 + 15 K2L2
Suppose the firm employs 10 units of capital.
At ___________ units of labor, average product of labor begins to dimish.
Select one:
a. 66.67
b. 100
c. 150
d. 350
e. 1500
Question 5
A firm is producing two goods ( X and Y ) that are related in consumption. The demand function for X is: Qd = 80 – 2PX – 12PY
Which of the following pairs of goods might the firm be producing?
Select one:
a. cola and diet cola
b. golf shoes and golf gloves
c. magazines and tennis rackets
d. bran cereal and sugar-frosted corn flakes
e. both A and D
Question 6
A manufacturer has two plants – one in Ohio and one in Tennessee. At the current allocation of total output between the two plants, the last unit of output produced in the Ohio plant added $10 to total cost, while the last unit of output produced in the Tennessee plant added $8 to total cost.
In order to decrease total costs, the firm should…
Select one:
a. Keep all the allocation between plants unchanged
b. Produce all its output in the Tennessee plant
c. Produce all its output in the Ohio plant
d. Switch some output from the Ohio to the Tennessee plant
e. Switch some output from the Tennessee to the Ohio plant
Question 7
A monopolistic competitor is similar to a monopolist in that:
Select one:
a. both earn positive economic profit in the long run.
b. both have market power.
c. both produce the output at which long-run average cost is a minimum
d. A and B.
e. all of the above.
Question 8
A newspaper offers students a discount on the regular subscription rate. The total number f subscriptions is optimal and, at the current prices, the marginal revenue from the last subscription sold to a student is $8, while the marginal revenue from the last subscription sold to a regular customer is $12.
If the magazine sells one more subscription to a regular customer and one less subscription to a student:
Select one:
a. profit will increase $4
b. profit will increase $12
c. profit will decrease $8
d. profit will decrease $12
e. none of the above
Question 9
A radio manufacturer is experiencing theft problems at its warehouse and has decided to hire security guards to reduce the thefts. The firm wants to minimize the net cost of warehouse thefts.
If the cost of a stolen radio us $25, what is the MOST the firm would be willing to pay to hire the first security guard?
Select one:
a. $700
b. $500
c. $250
d. $200
e. None of the above
Question 10
An underallocation of resources occurs when…
Select one:
a. a positive externality in consumption exists
b. a negative externality in production exists
c. marginal private benefit exceeds marginal social benefit
d. All of these will lead to underallocation of resources
Question 11
As a policy option for regulating natural monopoly, marginal cost pricing is desirable because…
Select one:
a. allocative efficiency is achieved
b. price is set equal to the minimum value of long-run average cost
c. consumers pay the lowest possible price that will generate sufficient revenue to cover the costs of the natural monopolist.
d. all of the above
Question 12
Demand: Qd = 600 – 30P Supply: Qs = -300 + 120P Equilibrium price and output are
Select one:
a. P = $2 and Q = 540
b. P = $10 and Q = 300
c. P = $6 and Q = 420
d. P = $3.33 and Q = 500
e. None of the above
Question 13
Economies of scale can arise because
Select one:
a. there is usually a qualitative change in the type of capital equipment employed as the scale of operation increase.
b. common or shared resources can be employed as the scale of operation increases, up to the minimum efficient scale (MES).
c. the cost of purchasing and installing larger machines is usually proportionately LESS than for smaller machines
d. both A and C
e. both B and C
Question 14
If a firm is producing a given level of output in an economically-efficient manner, then it must be the case that…
Select one:
a. it is choosing the lowest-cost method of producing that output
b. this output level is the most that can be produced with the given level of inputs
c. each input is producing its maximum marginal product
d. both A and B
e. both A and C.
Question 15
If the own-price elasticity of demand for a good is -0.6 and quantity demanded decreases by 30%, price must have…
Select one:
a. Decreased by 0.6%
b. Decreases by 18%
c. Increased by 20%
d. Increase by 50%
e. None of the above
Question 16
If the price of a good increases, the income effect
Select one:
a. reinforces the substitution effect if the good is normal
b. offsets the substitution effect if the good is inferior
c. shows the change in the quantity demanded of the good, income held constant
d. A and B
e. None of the above
Question 17
In long-run perfectly competitive equilibrium, economic efficiency is achieved because
Select one:
a. Price equals long-run marginal cost for every firm in the industry.
b. Price equals minimum long-run average cost for every firm in the industry.
c. Price equals average fixed cost for every firm in the industry
d. Both A and B
e. All of the above
Question 18
In the long run…
Select one:
a. a firm is making the optimal input choice when the marginal rate of technical substitution is equal to the input price ratio
b. the expansion path shows how the input marginal products change as the firm’s output level changes
c. all inputs are fixed
d. both A and B
e. both B and C.
Question 19
Marginal utility is the
Select one:
a. relative value of two goods when a utility-maximizing decision has been made
b. change in total utility that results from increasing the amount of a good consumed by one unit.
c. utility obtained from the consumption of all but the last unit of a good
d. change in the amount of a good consumed that increases total utility by one unit
e. none of the above
Question 20
Payoff table
Which cell in the payoff table represents the likely outcome of this advertising game?
Select one:
a. Cell A (Low, Low)
b. Cell C (Low, High)
c. Cell I (High, High)
d. Cell E (Medium, Medium)
e. Cell H (High, Medium)
Question 21
Price leadership…
Select one:
a. is not useful to a dominant firm if it could eliminate all its rivals through a price war
b. is an arrangement in which one firm in the market sets a price that the other firms match
c. occurs when a group of firms agree to limit competitive forces in the market
d. is when a firm makes a non-cooperative decision to raise its price
e. None of the above
Question 22
Private provision of public goods fails to achieve economic efficiency because…
Select one:
a. the free rider problem prevents collection of sufficient revenue
b. the free rider problem causes overproduction of the good
c. the price of the privately supplied public good must exceed zero in order to be allocatively efficient
d. both A and C
e. both B and C
Question 23
Stonebuilt Concrete produces a specialty cement used in construction of roads. Stonebuilt is a price-setting firm and estimates the demand for its cement by the state department of transportation using a demand function in the nonlinear form: Q = a Pb Mc P dR
Where Q = yards of cement demanded monthly, P = the price of Stonebuilt’s cement per yard, M = state tax revenues per capita, and PR = the price of asphalt per yard. The manager at Stonebuilt transforms the nonlinear relation for estimation. The estimation results are presented below:
If the price of asphalt (PR) decreases 15%, the estimated quantity of cement demanded will:
Select one:
a. increase 11.8%
b. decrease 11.8%
c. increase 5.2%
d. decrease 5.2%
e. increase 1.18%
Question 24
Suppose Dave, the owner-manager of Dave’s Golf Academy, earned $200,000 in revenue last year. Dave’s explicit costs of operation totaled $130,000. Dave has a Bachelor of Science degree in civil engineering and could be earning $60,000 annually as a civil engineer.
Select one:
a. Dave’s implicit cost of using owner-supplied resources is $130,000
b. Dave’s economic profit is $70,000
c. Dave’s implicit cost of using owner-supplied resources is $60,000
d. Dave’s economic profit is $10,000
e. Both C and D
Question 25
Suppose that the manager of a firm operating in a perfectly competitive market has estimated the average variable cost function to be:
AVC = 4.0 – 0.0024Q + 0.000006Q2
Fixed costs are $500.
The marginal cost function is:
Select one:
a. MC = 4.0 – 0.0048Q + 0.000018Q2
b. MC = 4.0Q – 0.0024Q2 + 0.000012Q3
c. MC = 4.0 – 0.0012Q + 0.000002Q2
d. None of the above
Question 26
Suppose you operate a sandwich shop and currently have two employees. If you hire a third employee, your output of sandwiches per day rises from 75 to 90. If you hire a fourth employee, output rises to 110 per day. A fifth and sixth employee would cause output to rise to 120 and 125 per day, respectively. Choose the correct statement:
Select one:
a. Diminishing returns set have not yet set in because output is still increases
b. Diminishing returns set in with the hiring of the fourth worker
c. Diminishing returns set in with the hiring of the fifth worker
d. Diminishing returns set in with the hiring of the sixth worker
Question 27
Table showing a demand schedule:
As output increases from 2,100 to 2,700 what is marginal revenue?
Select one:
a. $25
b. $50
c. -$25
d. -$300
e. $75
Question 28
Table showing a demand schedule:
If price falls from $250 to $200, what is the elasticity of demand over this range?
Select one:
a. -0.67
b. -1.0
c. -0.08
d. -1.5
e. -2.0
Question 29
Table showing the probability distribution of payoffs from an activity.
What is the expected value?
Select one:
a. 21
b. 36.5
c. 40
d. 42.5
e. 46.5
Question 30
The equation for demand is…
Select one:
a. P = 6,000 – 60Q
b. P = 60 – 100Q
c. Q = 60 – 0.01P
d. Q = 6,000 – 60P
e. None of the above
Question 31
The estimated demand for a good is
Q = 3,600 – 12P + 0.6M – 2.5PR
Where Q is the quantity demanded of the good, P is the price of the good, M is income, and PR is the price of related good R.
If the price of the good decrease by $10, all else constant, the quantity demanded will ______ by _____ units.
Select one:
a. Increase; 12
b. Increase; 120
c. Increase; 250
d. Decrease; 1.2
Question 32
The estimated demand for a good is
Q = 3,600 – 12P + 0.6M – 2.5PR
Where Q is the quantity demanded of the good, P is the price of the good, M is income, and PR is the price of related good R.
The good is…
Select one:
a. an inferior good since the coefficient on PR is negative
b. a normal good since the coefficient on P is negative
c. a normal good since the coefficient on M is positive
d. an inferior good since the coefficient on M is less than one (1).
Question 33
The figure below, which shows the linear demand and constant cost conditions facing a firm with a high barrier to entry.
If the entry barrier is removed consumers will be better off because…
Select one:
a. competition will eliminate the shortage caused by the entry barrier
b. productive efficiency will be restored
c. consumers will enjoy greater consumer surplus
d. none of the above
Question 34
The figure shows the demand and cost curves facing a monopoly in the short run.
The firm will sell its output at a price of…
Select one:
a. $2
b. $3
c. $3.75
d. $5
e. $6
Question 35
The following graph shows the marginal and average product curves for labor, the firm’s only variable input. The monthly wage for labor is $2,000. Fixed cost is $120,000.
What is the AVC at its minimum?
Select one:
a. $15
b. $25
c. $40
d. $80
e. $100
Question 36
The following payoff matrix shows the various profit outcomes for 3 projects, A, B, and C, under 2 possible states of nature: the product price is $15 or the product price is $25.
Using the maximax rule, the decision maker would choose…
Select one:
a. Project A
b. Project B
c. Project C
d. Impossible to say from the information given
Question 37
The graph on the left shows long-run average and marginal cost for a typical firm in a perfectly competitive industry. The graph on the right shows demand and long-run supply for an increasing-cost industry.
If this were instead a constant cost industry, what would be the price when the industry get to long-run competitive equilibrium?
Select one:
a. $4
b. below $4
c. between $7 and $4
d. $7
e. above $7
Question 38
The graph shows marginal benefits (MB) and marginal cost (MC) of activity A.
If the decision maker is choosing 100 units of activity A,
Select one:
a. the level maximizes net benefits
b. the activity could be increased by one unit and net benefits will increase by $20
c. the activity could be increased by one unit and the net benefits will decrease by $20
d. the activity could be increased by one unit and the net benefits will increase by $30
e. the activity could be increased by one unit and the net benefits will decrease by $30
Question 39
The graph shows the demand and marginal revenue in two markets, 1 and 2, for a price discriminating firm along with total marginal revenue, MRT, and marginal cost.
What total output should the firm produce?
Select one:
a. 200 units
b. 300 units
c. 400 units
d. 450 units
e. 850 units
Question 40
The market demand for a monopoly firm is estimated to be:
Qd = 80,000 – 400P + 3M + 2000PR
Where Q is output, P is price, M is income, and PR is the price of a related good. The manager has forecasted the values of M and PR will be $60,000 and $15, respectively, in 2011.
For 2011, the marginal revenue function is…
Select one:
a. MR = 80 – 0.002P
b. MR = 800 – 0.008Q
c. MR = 725 – 0.0025Q
d. MR = 725 – 0.005Q
Question 41
The price of capital (r) is $50.
What combination of labor (L) and capital (K) can produce 3,000 units of output as the lowest cost?
Select one:
a. 10K, 110L
b. 42K, 52L
c. 60K, 20L
d. 90K, 60L
e. 110K, 10L
Question 42
The price of X is $30 and the price of Y is $60.
How many units of Y will the consumer choose if point A is the utility-maximizing choice?
Select one:
a. 8
b. 12
c. 16
d. 24
e. None of the above
Question 43
The principal-agent problem arises when…
Select one:
a. The principal and the agent have different objectives
b. The principal cannot decide whether the firm should seek to maximize the expected future profits of the firm or maximize the price for which the firm can be sold
c. The principal cannot enforce the contract with the agent or finds it too costly to monitor the agent.
d. Both A and C.
e. None of the above
Question 44
These are the cost curves for a perfectly competitive firm.
If market price is $50, how much output will the firm produce?
Select one:
a. 0 Units
b. 100 Units
c. 300 Units
d. 400 Units
Question 45
To maximize profit a price discriminating firm should …
Select one:
a. allocate the output so that marginal revenue is the same in each market.
b. allocate the optimal output so the elasticity is the same in each market
c. produce the ouput at which total marginal revenue equals marginal cost
d. both A and C
e. both B and C
Question 46
Using the following marginal benefit and marginal cost functions for activity A:
MB = 100 – 0.05A
MC = 80 + 0.05A
The optimal level of A is…
Select one:
a. 1000
b. 2000
c. 600
d. 200
e. 100
Question 47
When there is negative externality in production,
Select one:
a. Marginal social benefit exceeds marginal private benefit
b. Marginal social cost exceeds marginal private cost
c. Marginal private cost exceeds marginal social cost
d. Marginal private benefit exceeds marginal social benefit
Question 48
Which of the following is a characteristic of a perfectly-competitive market?
Select one:
a. The firms are price-setters
b. All firms produce and sell a standardized or undifferentiated product
c. It is difficult for new firms to enter the market due to barriers to entry
d. The output sold by a particular firm may be quite different from the output sold by the other firms in the market
Question 49
Which of the following would decrease the supply of wheat?
Select one:
a. A decrease in the price of pesticides
b. An increase in the demand for wheat.
c. A rise in the price of wheat
d. An increase in the price of corn
e. None of the above
Question 50
Which of the following would lead to an INCREASE in the demand for golf balls?
Select one:
a. A decrease in the price of golf balls
b. An increase in the price of golf clubs
c. A decrease in the cost of producing golf balls
d. An increase in average household income when golf balls are a normal good
e. None of the above
ceiling price of $15 would cause
Select one:
a. A surplus of 800
b. A shortage of 800
c. A surplus of 600
d. A shortage of 600
Question 2
A firm estimated its short-run costs using an average variable cost function of the form
AVC = a + bQ = cQ2 and obtained the following results. Total fixed cost is$1,500.
If the firm produces 20 units of output, what is estimated AVC?
Select one:
a. $48.05
b. $74.05
c. $230.05
d. $242.05
Question 3
A firm estimated it’s short-run costs using an average variable cost function of the form AVC = a + bQ + cQ2 and obtained the following results. Total fixed cost is $1,500
If the firm produces 20 units of output, what is estimated total cost?
Select one:
a. $1,500
b. $1,481
c. $2,981
d. $6,341
Question 4
A firm estimates its long-run production function to be Q = -0.0050 K3L3 + 15 K2L2
Suppose the firm employs 10 units of capital.
At ___________ units of labor, average product of labor begins to dimish.
Select one:
a. 66.67
b. 100
c. 150
d. 350
e. 1500
Question 5
A firm is producing two goods ( X and Y ) that are related in consumption. The demand function for X is: Qd = 80 – 2PX – 12PY
Which of the following pairs of goods might the firm be producing?
Select one:
a. cola and diet cola
b. golf shoes and golf gloves
c. magazines and tennis rackets
d. bran cereal and sugar-frosted corn flakes
e. both A and D
Question 6
A manufacturer has two plants – one in Ohio and one in Tennessee. At the current allocation of total output between the two plants, the last unit of output produced in the Ohio plant added $10 to total cost, while the last unit of output produced in the Tennessee plant added $8 to total cost.
In order to decrease total costs, the firm should…
Select one:
a. Keep all the allocation between plants unchanged
b. Produce all its output in the Tennessee plant
c. Produce all its output in the Ohio plant
d. Switch some output from the Ohio to the Tennessee plant
e. Switch some output from the Tennessee to the Ohio plant
Question 7
A monopolistic competitor is similar to a monopolist in that:
Select one:
a. both earn positive economic profit in the long run.
b. both have market power.
c. both produce the output at which long-run average cost is a minimum
d. A and B.
e. all of the above.
Question 8
A newspaper offers students a discount on the regular subscription rate. The total number f subscriptions is optimal and, at the current prices, the marginal revenue from the last subscription sold to a student is $8, while the marginal revenue from the last subscription sold to a regular customer is $12.
If the magazine sells one more subscription to a regular customer and one less subscription to a student:
Select one:
a. profit will increase $4
b. profit will increase $12
c. profit will decrease $8
d. profit will decrease $12
e. none of the above
Question 9
A radio manufacturer is experiencing theft problems at its warehouse and has decided to hire security guards to reduce the thefts. The firm wants to minimize the net cost of warehouse thefts.
If the cost of a stolen radio us $25, what is the MOST the firm would be willing to pay to hire the first security guard?
Select one:
a. $700
b. $500
c. $250
d. $200
e. None of the above
Question 10
An underallocation of resources occurs when…
Select one:
a. a positive externality in consumption exists
b. a negative externality in production exists
c. marginal private benefit exceeds marginal social benefit
d. All of these will lead to underallocation of resources
Question 11
As a policy option for regulating natural monopoly, marginal cost pricing is desirable because…
Select one:
a. allocative efficiency is achieved
b. price is set equal to the minimum value of long-run average cost
c. consumers pay the lowest possible price that will generate sufficient revenue to cover the costs of the natural monopolist.
d. all of the above
Question 12
Demand: Qd = 600 – 30P Supply: Qs = -300 + 120P Equilibrium price and output are
Select one:
a. P = $2 and Q = 540
b. P = $10 and Q = 300
c. P = $6 and Q = 420
d. P = $3.33 and Q = 500
e. None of the above
Question 13
Economies of scale can arise because
Select one:
a. there is usually a qualitative change in the type of capital equipment employed as the scale of operation increase.
b. common or shared resources can be employed as the scale of operation increases, up to the minimum efficient scale (MES).
c. the cost of purchasing and installing larger machines is usually proportionately LESS than for smaller machines
d. both A and C
e. both B and C
Question 14
If a firm is producing a given level of output in an economically-efficient manner, then it must be the case that…
Select one:
a. it is choosing the lowest-cost method of producing that output
b. this output level is the most that can be produced with the given level of inputs
c. each input is producing its maximum marginal product
d. both A and B
e. both A and C.
Question 15
If the own-price elasticity of demand for a good is -0.6 and quantity demanded decreases by 30%, price must have…
Select one:
a. Decreased by 0.6%
b. Decreases by 18%
c. Increased by 20%
d. Increase by 50%
e. None of the above
Question 16
If the price of a good increases, the income effect
Select one:
a. reinforces the substitution effect if the good is normal
b. offsets the substitution effect if the good is inferior
c. shows the change in the quantity demanded of the good, income held constant
d. A and B
e. None of the above
Question 17
In long-run perfectly competitive equilibrium, economic efficiency is achieved because
Select one:
a. Price equals long-run marginal cost for every firm in the industry.
b. Price equals minimum long-run average cost for every firm in the industry.
c. Price equals average fixed cost for every firm in the industry
d. Both A and B
e. All of the above
Question 18
In the long run…
Select one:
a. a firm is making the optimal input choice when the marginal rate of technical substitution is equal to the input price ratio
b. the expansion path shows how the input marginal products change as the firm’s output level changes
c. all inputs are fixed
d. both A and B
e. both B and C.
Question 19
Marginal utility is the
Select one:
a. relative value of two goods when a utility-maximizing decision has been made
b. change in total utility that results from increasing the amount of a good consumed by one unit.
c. utility obtained from the consumption of all but the last unit of a good
d. change in the amount of a good consumed that increases total utility by one unit
e. none of the above
Question 20
Payoff table
Which cell in the payoff table represents the likely outcome of this advertising game?
Select one:
a. Cell A (Low, Low)
b. Cell C (Low, High)
c. Cell I (High, High)
d. Cell E (Medium, Medium)
e. Cell H (High, Medium)
Question 21
Price leadership…
Select one:
a. is not useful to a dominant firm if it could eliminate all its rivals through a price war
b. is an arrangement in which one firm in the market sets a price that the other firms match
c. occurs when a group of firms agree to limit competitive forces in the market
d. is when a firm makes a non-cooperative decision to raise its price
e. None of the above
Question 22
Private provision of public goods fails to achieve economic efficiency because…
Select one:
a. the free rider problem prevents collection of sufficient revenue
b. the free rider problem causes overproduction of the good
c. the price of the privately supplied public good must exceed zero in order to be allocatively efficient
d. both A and C
e. both B and C
Question 23
Stonebuilt Concrete produces a specialty cement used in construction of roads. Stonebuilt is a price-setting firm and estimates the demand for its cement by the state department of transportation using a demand function in the nonlinear form: Q = a Pb Mc P dR
Where Q = yards of cement demanded monthly, P = the price of Stonebuilt’s cement per yard, M = state tax revenues per capita, and PR = the price of asphalt per yard. The manager at Stonebuilt transforms the nonlinear relation for estimation. The estimation results are presented below:
If the price of asphalt (PR) decreases 15%, the estimated quantity of cement demanded will:
Select one:
a. increase 11.8%
b. decrease 11.8%
c. increase 5.2%
d. decrease 5.2%
e. increase 1.18%
Question 24
Suppose Dave, the owner-manager of Dave’s Golf Academy, earned $200,000 in revenue last year. Dave’s explicit costs of operation totaled $130,000. Dave has a Bachelor of Science degree in civil engineering and could be earning $60,000 annually as a civil engineer.
Select one:
a. Dave’s implicit cost of using owner-supplied resources is $130,000
b. Dave’s economic profit is $70,000
c. Dave’s implicit cost of using owner-supplied resources is $60,000
d. Dave’s economic profit is $10,000
e. Both C and D
Question 25
Suppose that the manager of a firm operating in a perfectly competitive market has estimated the average variable cost function to be:
AVC = 4.0 – 0.0024Q + 0.000006Q2
Fixed costs are $500.
The marginal cost function is:
Select one:
a. MC = 4.0 – 0.0048Q + 0.000018Q2
b. MC = 4.0Q – 0.0024Q2 + 0.000012Q3
c. MC = 4.0 – 0.0012Q + 0.000002Q2
d. None of the above
Question 26
Suppose you operate a sandwich shop and currently have two employees. If you hire a third employee, your output of sandwiches per day rises from 75 to 90. If you hire a fourth employee, output rises to 110 per day. A fifth and sixth employee would cause output to rise to 120 and 125 per day, respectively. Choose the correct statement:
Select one:
a. Diminishing returns set have not yet set in because output is still increases
b. Diminishing returns set in with the hiring of the fourth worker
c. Diminishing returns set in with the hiring of the fifth worker
d. Diminishing returns set in with the hiring of the sixth worker
Question 27
Table showing a demand schedule:
As output increases from 2,100 to 2,700 what is marginal revenue?
Select one:
a. $25
b. $50
c. -$25
d. -$300
e. $75
Question 28
Table showing a demand schedule:
If price falls from $250 to $200, what is the elasticity of demand over this range?
Select one:
a. -0.67
b. -1.0
c. -0.08
d. -1.5
e. -2.0
Question 29
Table showing the probability distribution of payoffs from an activity.
What is the expected value?
Select one:
a. 21
b. 36.5
c. 40
d. 42.5
e. 46.5
Question 30
The equation for demand is…
Select one:
a. P = 6,000 – 60Q
b. P = 60 – 100Q
c. Q = 60 – 0.01P
d. Q = 6,000 – 60P
e. None of the above
Question 31
The estimated demand for a good is
Q = 3,600 – 12P + 0.6M – 2.5PR
Where Q is the quantity demanded of the good, P is the price of the good, M is income, and PR is the price of related good R.
If the price of the good decrease by $10, all else constant, the quantity demanded will ______ by _____ units.
Select one:
a. Increase; 12
b. Increase; 120
c. Increase; 250
d. Decrease; 1.2
Question 32
The estimated demand for a good is
Q = 3,600 – 12P + 0.6M – 2.5PR
Where Q is the quantity demanded of the good, P is the price of the good, M is income, and PR is the price of related good R.
The good is…
Select one:
a. an inferior good since the coefficient on PR is negative
b. a normal good since the coefficient on P is negative
c. a normal good since the coefficient on M is positive
d. an inferior good since the coefficient on M is less than one (1).
Question 33
The figure below, which shows the linear demand and constant cost conditions facing a firm with a high barrier to entry.
If the entry barrier is removed consumers will be better off because…
Select one:
a. competition will eliminate the shortage caused by the entry barrier
b. productive efficiency will be restored
c. consumers will enjoy greater consumer surplus
d. none of the above
Question 34
The figure shows the demand and cost curves facing a monopoly in the short run.
The firm will sell its output at a price of…
Select one:
a. $2
b. $3
c. $3.75
d. $5
e. $6
Question 35
The following graph shows the marginal and average product curves for labor, the firm’s only variable input. The monthly wage for labor is $2,000. Fixed cost is $120,000.
What is the AVC at its minimum?
Select one:
a. $15
b. $25
c. $40
d. $80
e. $100
Question 36
The following payoff matrix shows the various profit outcomes for 3 projects, A, B, and C, under 2 possible states of nature: the product price is $15 or the product price is $25.
Using the maximax rule, the decision maker would choose…
Select one:
a. Project A
b. Project B
c. Project C
d. Impossible to say from the information given
Question 37
The graph on the left shows long-run average and marginal cost for a typical firm in a perfectly competitive industry. The graph on the right shows demand and long-run supply for an increasing-cost industry.
If this were instead a constant cost industry, what would be the price when the industry get to long-run competitive equilibrium?
Select one:
a. $4
b. below $4
c. between $7 and $4
d. $7
e. above $7
Question 38
The graph shows marginal benefits (MB) and marginal cost (MC) of activity A.
If the decision maker is choosing 100 units of activity A,
Select one:
a. the level maximizes net benefits
b. the activity could be increased by one unit and net benefits will increase by $20
c. the activity could be increased by one unit and the net benefits will decrease by $20
d. the activity could be increased by one unit and the net benefits will increase by $30
e. the activity could be increased by one unit and the net benefits will decrease by $30
Question 39
The graph shows the demand and marginal revenue in two markets, 1 and 2, for a price discriminating firm along with total marginal revenue, MRT, and marginal cost.
What total output should the firm produce?
Select one:
a. 200 units
b. 300 units
c. 400 units
d. 450 units
e. 850 units
Question 40
The market demand for a monopoly firm is estimated to be:
Qd = 80,000 – 400P + 3M + 2000PR
Where Q is output, P is price, M is income, and PR is the price of a related good. The manager has forecasted the values of M and PR will be $60,000 and $15, respectively, in 2011.
For 2011, the marginal revenue function is…
Select one:
a. MR = 80 – 0.002P
b. MR = 800 – 0.008Q
c. MR = 725 – 0.0025Q
d. MR = 725 – 0.005Q
Question 41
The price of capital (r) is $50.
What combination of labor (L) and capital (K) can produce 3,000 units of output as the lowest cost?
Select one:
a. 10K, 110L
b. 42K, 52L
c. 60K, 20L
d. 90K, 60L
e. 110K, 10L
Question 42
The price of X is $30 and the price of Y is $60.
How many units of Y will the consumer choose if point A is the utility-maximizing choice?
Select one:
a. 8
b. 12
c. 16
d. 24
e. None of the above
Question 43
The principal-agent problem arises when…
Select one:
a. The principal and the agent have different objectives
b. The principal cannot decide whether the firm should seek to maximize the expected future profits of the firm or maximize the price for which the firm can be sold
c. The principal cannot enforce the contract with the agent or finds it too costly to monitor the agent.
d. Both A and C.
e. None of the above
Question 44
These are the cost curves for a perfectly competitive firm.
If market price is $50, how much output will the firm produce?
Select one:
a. 0 Units
b. 100 Units
c. 300 Units
d. 400 Units
Question 45
To maximize profit a price discriminating firm should …
Select one:
a. allocate the output so that marginal revenue is the same in each market.
b. allocate the optimal output so the elasticity is the same in each market
c. produce the ouput at which total marginal revenue equals marginal cost
d. both A and C
e. both B and C
Question 46
Using the following marginal benefit and marginal cost functions for activity A:
MB = 100 – 0.05A
MC = 80 + 0.05A
The optimal level of A is…
Select one:
a. 1000
b. 2000
c. 600
d. 200
e. 100
Question 47
When there is negative externality in production,
Select one:
a. Marginal social benefit exceeds marginal private benefit
b. Marginal social cost exceeds marginal private cost
c. Marginal private cost exceeds marginal social cost
d. Marginal private benefit exceeds marginal social benefit
Question 48
Which of the following is a characteristic of a perfectly-competitive market?
Select one:
a. The firms are price-setters
b. All firms produce and sell a standardized or undifferentiated product
c. It is difficult for new firms to enter the market due to barriers to entry
d. The output sold by a particular firm may be quite different from the output sold by the other firms in the market
Question 49
Which of the following would decrease the supply of wheat?
Select one:
a. A decrease in the price of pesticides
b. An increase in the demand for wheat.
c. A rise in the price of wheat
d. An increase in the price of corn
e. None of the above
Question 50
Which of the following would lead to an INCREASE in the demand for golf balls?
Select one:
a. A decrease in the price of golf balls
b. An increase in the price of golf clubs
c. A decrease in the cost of producing golf balls
d. An increase in average household income when golf balls are a normal good
e. None of the above
Leadership MCQ – 100 questions
1. Which of the following statements regarding leaders and managers is NOT true?
a. A manager always has the ability to influence others; a leader may not.
b. A manager has a formal title and authority.
c. A leader may either be a manager or a nonmanager.
d. All managers perform four major functions: planning, organizing, leading, and
controlling.
2. Which of the following leadership theories attempts to explain distinctive characteristics for
leadership effectiveness?
a. interpersonal
b. trait
c. integrative
d. behavioral
3. Which of the following is NOT one of Mintzberg’s interpersonal leadership roles?
a. figurehead
b. entrepreneur
c. leader
d. liaison
4. In your position, you serve on committees with people from outside of your organizational
units and attend professional meetings. These are expectations for Mintzberg’s interpersonal
role of ___________.
a. disseminator
b. figurehead
c. liaison
d. resource-allocator
5. Your leader has asked you to design a new performance evaluation system. Designing the
system is an example of which of Mintzberg’s managerial roles?
a. entrepreneur
b. interpersonal
c. disturbance-handler
d. negotiator
6. The three levels of analysis of leadership theory are ___________.
a. individual, group, and organizational
b. team, group, and organizational
c. leader, group, and organizational
d. interpersonal, leader, and group
7. The individual level of analysis which focuses on the leader’s relationship with individual
followers is also called the ___________ process.
a. group
b. dyadic
c. organizational
d. conceptual
8. Early leadership studies were based on the assumption that leaders are ___________.
a. autocratic
b. primarily male
c. born, not made
d. also managers
9. Which of the following statements regarding personality is true?
a. Personality is developed based on genetics and environmental factors.
b. Personality predicts behavior and job performance.
c. Personality affects behavior as well as perceptions and attitudes.
d. All of the above.
10. The _________ personality dimension includes traits related to self-control and how well one
remains under pressure.
a. agreeableness
b. conscientiousness
c. surgency
d. adjustment
11. Of the Big Five personality dimensions, the highest correlation with leadership is _________.
a. conscientiousness
b. openness to experience
c. surgency
d. adjustment
12. Which of the following is NOT a trait of an effective leader?
a. dominance
b. high energy
c. intelligence
d. talent
13. Which of the following is NOT a belief of David McClelland?
a. Needs are based on personality.
b. All people possess the need for achievement, power, and affiliation, but to varying
degrees.
c. Our needs are motivated by our behavior.
d. Needs are developed as we interact with the environment.
14. The Leader Motive Profile (LMP) defines which motive as the highest need for leaders?
a. achievement
b. power
c. affiliation
d. enjoyment
15. ________ are positive or negative feelings about people, things, and issues.
a. Attitudes
b. Norms
c. Beliefs
d. Traits
16. A manager from a prestigious university believed that employees who were from “lesser
schools” lacked sufficient intelligence and motivation for the high-tech firm that she led.
She set goals for these employees low, and did not trust them with certain important tasks
or company information. The employees, in fact, tended to show dissatisfaction and low
performance. At length, many of them quit. This would be an example of ___________.
a. Theory Y
b. the Pygmalion effect
c. negative self-concept
d. None of the above.
17. The University of Iowa studies led to an era of ___________ research.
a. behavioral
b. trait
c. personality
d. participation
18. __________ is credited as being the first to identify the participative leadership style that is
commonly used today.
a. Maslow
b. Vroom
c. Herzberg
d. Likert
19. Based on extensive research, Blake and Mouton would expect the best performance from a
firm whose leadership ____________.
a. displays an ultimate priority of meeting employees’ needs
b. sets the highest priority on task completion
c. puts a balanced and moderate managerial effort between meeting employees’ needs
and task completion
d. puts the highest priority on both meeting employees’ needs and task completion
20. Which of the following is NOT one of the four major assumptions that Abraham Maslow
based his hierarchy of needs theory on?
a. People’s needs are arranged in order of importance going from basic to complex
needs.
b. People will not be motivated to satisfy a higher-level need unless the lower-level
need(s) has been at least minimally satisfied.
c. Both met and unmet needs motivate.
d. People have five classifications of needs.
21. To motivate his highest performers, a manager gives his highest performer each month an
“Employee of the Month” award and a parking space next to his. Of what motivational
theory is this an example?
a. goal-setting
b. equity
c. expectancy
d. Reinforcement theory
22. Which of the following is NOT a category of needs in the acquired needs theory?
a. success
b. power
c. achievement
d. affiliation
23. To motivate employees with a high n Pow, you should do all of the following EXCEPT:
a. Let them plan and control their jobs as much as possible.
b. Try to include them in decision making.
c. Try to assign them to a whole task rather than just a part of a task.
d. Let them work as part of a team.
24. The process motivation theories are alike in that all focus on ___________.
a. understanding how people choose behavior to fulfill their needs
b. explaining and predicting behavior based on people’s needs
c. reinforcement of positive behaviors
d. giving praise
25. Today, more companies are looking for graduates with ___________.
a. more collective responsibility
b. international openness and flexibility
c. more holistic concern for employees
d. longer periods of employment
26. Which of the following is NOT one of the variables that determine situational favorableness?
a. task structure
b. locus of control
c. position power
d. leader−member relations
27. Which of the following best represents a situation in which a relationship-oriented
leadership style should be used?
a. A leader with strong power has good relations with a nonrepetitive task worker.
b. A leader with strong power has poor relations with a repetitive task worker.
c. A leader with strong power has good relations with a repetitive task worker.
d. A leader with weak power has poor relations with a nonrepetitive task worker.
28. The leader who permits followers to make ongoing decisions within defined limits uses
which style on the leadership continuum model?
a. 4
b. 7
c. 6
d. 1
29. Authoritarianism is the degree to which employees ___________.
a. defer to others
b. want to be told what to do
c. want to be told how to do the job
d. All of the above.
30. ___________ leadership is appropriate when followers are open to autocratic leadership,
have external locus of control, and follower ability is high.
a. Directive
b. Supportive
c. Participative
d. Achievement-oriented
31. The normative leadership model uses decision trees that are ___________.
a. time-driven and developmental-driven
b. leader-driven and follower-driven
c. task-driven and people-driven
d. goal-driven and decision-driven
32. The normative leadership model includes all of the following leadership styles EXCEPT:
a. decide
b. consult group
c. facilitate
d. participative
33. As a manager, you can influence people to do things that they normally would not have done
through your use of ___________ power, which is derived from top management.
a. personal
b. position
c. political
d. coercive
34. The consultation influencing tactic is also known as ___________.
a. participative management
b. coalition building
c. group influencing
d. consultant power
35. When you develop a rational persuasion, you should do all of the following EXCEPT:
a. focus on how you and the organization benefit by achieving the objective
b. offer a detailed step-by-step plan
c. explain how potential problems and concerns will be handled
d. demonstrate how to do a task, when possible
36. To increase your reward power, __________.
a. exercise your authority regularly
b. develop your people skills
c. let people know you control rewards
d. use rewards for personal benefit
37. __________ power is based on the user’s relationship with influential people.
a. Reward
b. Legitimate
c. Referent
d. Connection
38. Politics __________.
a. is a medium of exchange
b. has a negative connotation
c. is inherently neither good nor bad
d. All of the above.
39. Money and power have a similar use in that both are used ___________.
a. to obtain desires
b. as a medium of exchange
c. to accomplish objectives
d. to exert control
40. Which of the following is a guideline for developing political skills?
a. learn the organizational culture
b. gain recognition
c. tune out the grapevine
d. secretly pursue your self-interests
41. The manager of a manufacturing plant is inaugurating a major quality initiative and is
planning the announcement to the employees. She has considered the goal and mode of
the message. What other issue should be considered in this planning?
a. who should receive the message
b. the timing of the message
c. whether to solicit feedback
d. All of the above.
42. The value of stating the objectives of communication is to ________.
a. establish rapport
b. get buy-in from the recipient
c. elicit feedback before continuing the communication
d. help the receiver put the details into context
43. To check for the receiver’s understanding in oral communication, you ask him or her:
a. “ Do you have any questions?”
b. direct questions
c. indirect questions
d. to paraphrase the message
44. All of the following are components of listening EXCEPT:
a. paying attention
b. asking questions
c. not assuming and interrupting
d. watching and attending to only verbal cues
45. Which of the following is a component of checking understanding?
a. asking questions
b. conveying meaning
c. watching nonverbal cues
d. paying attention
46. An employee has mismanaged a client relationship and lost the client. As the manager, you
want to use a self-evaluation type of coaching feedback. Which of the following might
apply?
a. “I told you to be careful with that relationship.”
b. “I guess that this just shows why we emphasize training.”
c. “When you lose clients, that makes me frustrated.”
d. “Why do you suppose that client dropped us and went to our competitor?”
47. Which of the following is used to explain the process managers go through in determining
the reasons for effective or ineffective performance and deciding what to do about it?
a. attribution theory
b. psychological contract
c. performance formula
d. BCF model
48. In the performance formula, John and his team are not performing as well as other teams.
Based on your assessment of the situation, you believe that John and his team have the
ability to perform well and seem to be motivated to do the work. What should you do next?
a. Get John’s commitment to change.
b. Have John and his team sign a psychological contract.
c. Check to see what resources they may be lacking.
d. Send them to training.
49. Which of the following statements best describes the vertical dyadic linkage theory?
a. The focus is on the quality of each dyad.
b. Leaders aspire to build positive relationships with all followers.
c. Linkages among peers are disavowed.
d. Leader−follower interactions create in-groups and out-groups.
50. Leaders mostly use all of the following types of power to influence out-group members
EXCEPT:
a. legitimate power
b. referent power
c. reward power
d. coercive power
51. Which of the following statements regarding in-groups and out-groups is NOT true?
a. In-group followers routinely receive higher performance ratings than out-group
followers.
b. In-group followers do not require as much attention as out-group followers.
c. In-group followers give more positive ratings when evaluating organizational climate
than out-group followers.
d. Out-group followers routinely show higher levels of turnover than in-group followers.
52. All of the following are factors that determine LMX quality EXCEPT:
a. follower attributes
b. situational factors
c. organizational culture
d. leader and follower perceptions of each other
53. As Jim’s leader, you have noticed that he is low on involvement and high on critical
thinking, and you have concluded that Jim is a(n) __________ follower.
a. alienated
b. conformist
c. passive
d. pragmatic
54. The __________ follower is someone who is high on critical thinking and involvement.
a. alienated
b. conformist
c. effective
d. pragmatic
55. When challenging a leader’s flawed plans and proposals, it is important for the follower to
___________.
a. pinpoint specifics
b. personalize the critique
c. provide both positive and negative feedback
d. ask for suggestions
56. People with a(n) ___________ locus of control believe that they are “masters of their own
destiny” and can influence people and events in their workplace.
a. internal
b. external
c. neutral
d. optimal
57. Which of the following describes a team vs. a group?
a. A group implies a sense of collective responsibility.
b. A team tends to have shared responsibilities.
c. A team implies a sense of shared mission.
d. b and c only
58. Shirking of individual responsibility is also known as ___________.
a. groupthink
b. synergy
c. social loafing
d. task facilitation
59. Which of the following statements regarding team diversity is NOT true?
a. A disadvantage of team diversity is the increased likelihood of groupthink.
b. Team diversity brings diverse points of view to bear on problems.
c. Teams that do not manage diversity well have a good chance for intrateam conflicts.
d. Not all diverse teams perform well.
60. One of the prescriptions for success in using the leader-centered decision-making model is
that the leader should ___________.
a. discourage members from expressing their feelings
b. relinquish control to the team and allow it to make the final choice in all appropriate
kinds of decisions
c. listen attentively and observe nonverbal cues to be aware of member needs, feelings,
interactions, and conflict
d. All of the above.
61. Before calling a meeting, the leader should do all of the following EXCEPT:
a. decide who should attend the meeting.
b. identify the activities that will take place during the meeting.
c. set aside at least 3−4 hours to prepare for the meeting.
d. clearly define the purpose and set objectives to be accomplished during the meeting.
62. During meetings, the team leader should focus on all of the following EXCEPT:
a. group structure
b. group process
c. group development
d. group effectiveness
63. Which of the following does NOT describe a self-managed team?
a. fixed team design
b. team accountability
c. multiskilled skills
d. leadership within the team
64. A self-managed team ___________ is an advocate of the self-managed team concept whose
responsibility is to help the team obtain necessary resources, gain political support from
top management and other stakeholders of the organization, and defend it from enemy
attacks.
a. facilitator
b. leader
c. champion
d. director
65. Max Weber defined “charisma” as a form of influence based on ___________.
a. traditional authority systems
b. follower perceptions
c. leader−member exchange
d. legal−rational authority systems
66. Which of the following is NOT one of the behavior attributes that distinguish charismatic
from noncharismatic leaders?
a. use of unconventional strategies for achieving desired change
b. dissatisfaction with the status quo
c. compelling nature of the vision
d. use of rewards and incentives for motivating followers
67. The debate concerning the locus of charismatic leadership states that charisma could be the
result of all of the following EXCEPT:
a. the emotional involvement of the followers
b. the leader’s extraordinary qualities
c. the situation or social climate facing the leader
d. an interaction of the situation and the leader’s qualities
68. An effect of charismatic leadership on followers is to cause them to ___________.
a. assume greater risk
b. set or accept higher goals
c. have greater confidence in their ability to contribute to the achievement of goals
d. All of the above.
69. Socialized charismatic leaders __________.
a. pursue leader-driven goals
b. promote feelings of empowerment, personal growth, and equal participation in
followers
c. restrict information
d. All of the above.
70. In the four stage model of the transformation process, which of the following is the first
stage?
a. institutionalize change
b. challenge the status quo and make a convincing case for change
c. inspire a shared vision of the future
d. provide effective leadership during the change
71. Transactional leaders ___________.
a. appeal to higher ideals and moral values
b. get followers to act by giving them something that they desire in exchange for
compliance
c. attempt to think “outside of the box”
d. rely heavily on the articulation of a vision to inspire subordinates
72. The key to successful stewardship is based on all of the following values EXCEPT:
a. strong teamwork orientation
b. effective listening
c. equality assumption
d. reward assumption
73. Which of the following is a function of culture?
a. It keeps diversity from becoming extreme.
b. It results in strategic alignment.
c. It helps the organization adapt to the external environment.
d. All of the above.
74. Insular thinking is an attribute of a(n) __________ culture.
a. low-performance
b. high-performance
c. bureaucratic
d. adaptive
75. All of the following are substantive leadership actions for shaping culture EXCEPT:
a. matching HR practices to culture.
b. aligning reward/incentive system with culture.
c. developing a written values statement.
d. interacting face-to-face with rank-and-file.
76. A new CEO is appointed to Xex Corporation. Which of the following should occur for there to be successful outcomes in changing Xex’s organizational culture?
a. The CEO traits and values fit the organization’s values.
b. The CEO frequently attends both ceremonial and non-ceremonial events.
c. The CEO’s behaviors match his/her espoused values.
d. All of the above.
77. _________ culture represents a leadership belief in strong, mutually reinforcing exchanges
and linkages between employees and departments.
a. Cooperative
b. Adaptive
c. Competitive
d. Bureaucratic
78. Organizations with __________ cultures are highly structured and efficiency driven.
a. competitive
b. adaptive
c. bureaucratic
d. cooperative
79. An employee’s disclosure of illegal or unethical practices on the part of the organization is
called ___________.
a. ethical disclosure
b. whistle blowing
c. moral reasoning
d. individualism
80. ___________ has a high power-distance culture.
a. Germany
b. The United States
c. Ireland
d. France
81. Strategic ___________ is the process of providing the direction and inspiration necessary to
create and implement a firm’s vision, mission, and strategies to achieve organizational
objectives.
a. management
b. leadership
c. necessity
d. vision
82. The effective strategist must be capable of which of the following?
a. communicating effectively
b. deciding on appropriate goals and priorities
c. anticipating and forecasting events in the external environment
d. All of the above.
83. Strategic __________ is the set of decisions and actions used to formulate and implement
specific strategies that will achieve a competitively superior fit between the organization
and its environment so as to achieve organizational goals.
a. leadership
b. analysis
c. management
d. vision
84. Goal-setting theory asserts that people with __________ goals perform better than those with
__________ goals.
a. strategic; corporate
b. vague; strategic
c. specific; strategic
d. stretch; vague
85. Competitive advantage is improved when a firm’s __________.
a. core competencies match external environmental opportunities
b. vision is benchmarked from industry-best practices
c. strategic moves match those of its best competitors
d. All of the above.
86. __________ change is an alteration in an organization’s alignment with its external
environment.
a. Strategic
b. Organizational
c. Functional
d. None of the above.
87. Which of the following is a phase or stage of the change process?
a. unfreezing
b. changing
c. refreezing
d. All of the above.
88. Which of the following is/are stages in Lewin’s classic theory of change?
a. unfreezing
b. establishing a sense of urgency
c. changing, moving to a new, desired state
d. a and c only
89. In the three stage model of change, the __________ phase is also known as cognitive
restructuring because it is where the actual change takes place.
a. unfreezing
b. changing
c. refreezing
d. Sense of urgency
90. Effective leaders can create psychological safety for employees who fear change by
__________.
a. providing opportunities for training and education
b. slowing the pace of change as much as possible
c. downplaying any resistance
d. implementing incremental, rather than radical, change
91. Strategic crisis leadership requires all of the following EXCEPT:
a. integrating crisis management into the strategic management process so it remains a
regular part of the overall strategy−evaluation process
b. using environmental monitoring techniques to identify events that could trigger crises
in the future
c. identifying emerging patterns or trends in the regulatory environment, competitive
landscape, and social environment
d. establishing a culture that embraces crisis awareness and preparation as a way of
life
92. Emerging trends in the current business environment that make crisis management
especially important among the skills of leadership include ___________.
a. technological advances
b. the economic downturn
c. the overall desirability of learning about risk matrices
d. All of the above.
93. The primary duties of the crisis leader may include activities such as ___________.
a. coordinating the activities of the crisis management team to ensure that the members
work well together
b. requiring individuals or departments to keep logs of complaints or incidents
c. monitoring customer and employee complaints and behavior
d. All of the above.
94. Which of the following is NOT one of the steps in the risk assessment process?
a. risk reduction
b. risk identification
c. crisis management
d. risk analysis
95. The best gauge to determine an organization’s readiness to respond to a crisis is how it rates
according to which of the following factors?
a. awareness and access to crisis management information
b. readiness for a quick response
c. effective communication plan in place
d. All of the above.
96. A __________ is a printed statement that describes how an organization is responding to a
crisis and who is in charge.
a. press release
b. crisis bulletin
c. press kit
d. crisis release
97. Which of the following is a characteristic of a traditional organization?
a. flat horizontal structure
b. personal and group networks of free, open exchanges with no filters
c. centralized decision making
d. loose, flexible, and adaptive roles
98. All of the following are characteristics of traditional organizations EXCEPT:
a. adaptive culture that encourages continuous improvement and change
b. stable environment
c. vertical structure
d. rigid culture that is not responsive to change
99. ___________ change occurs when anticipated or expected changes bear no resemblance to
the present or the past.
a. Acquisitional
b. Radical
c. Organizational
d. Discontinuous
100. The encouragement of systems thinking __________.
a. is a task of leaders who seek to enhance organizational learning
b. has the best results in traditional organizations
c. was a driving force in the 1980s, but has been largely discarded in favor of
specialized thinking
d. increases efficiency, but appears to deter creativity
a. A manager always has the ability to influence others; a leader may not.
b. A manager has a formal title and authority.
c. A leader may either be a manager or a nonmanager.
d. All managers perform four major functions: planning, organizing, leading, and
controlling.
2. Which of the following leadership theories attempts to explain distinctive characteristics for
leadership effectiveness?
a. interpersonal
b. trait
c. integrative
d. behavioral
3. Which of the following is NOT one of Mintzberg’s interpersonal leadership roles?
a. figurehead
b. entrepreneur
c. leader
d. liaison
4. In your position, you serve on committees with people from outside of your organizational
units and attend professional meetings. These are expectations for Mintzberg’s interpersonal
role of ___________.
a. disseminator
b. figurehead
c. liaison
d. resource-allocator
5. Your leader has asked you to design a new performance evaluation system. Designing the
system is an example of which of Mintzberg’s managerial roles?
a. entrepreneur
b. interpersonal
c. disturbance-handler
d. negotiator
6. The three levels of analysis of leadership theory are ___________.
a. individual, group, and organizational
b. team, group, and organizational
c. leader, group, and organizational
d. interpersonal, leader, and group
7. The individual level of analysis which focuses on the leader’s relationship with individual
followers is also called the ___________ process.
a. group
b. dyadic
c. organizational
d. conceptual
8. Early leadership studies were based on the assumption that leaders are ___________.
a. autocratic
b. primarily male
c. born, not made
d. also managers
9. Which of the following statements regarding personality is true?
a. Personality is developed based on genetics and environmental factors.
b. Personality predicts behavior and job performance.
c. Personality affects behavior as well as perceptions and attitudes.
d. All of the above.
10. The _________ personality dimension includes traits related to self-control and how well one
remains under pressure.
a. agreeableness
b. conscientiousness
c. surgency
d. adjustment
11. Of the Big Five personality dimensions, the highest correlation with leadership is _________.
a. conscientiousness
b. openness to experience
c. surgency
d. adjustment
12. Which of the following is NOT a trait of an effective leader?
a. dominance
b. high energy
c. intelligence
d. talent
13. Which of the following is NOT a belief of David McClelland?
a. Needs are based on personality.
b. All people possess the need for achievement, power, and affiliation, but to varying
degrees.
c. Our needs are motivated by our behavior.
d. Needs are developed as we interact with the environment.
14. The Leader Motive Profile (LMP) defines which motive as the highest need for leaders?
a. achievement
b. power
c. affiliation
d. enjoyment
15. ________ are positive or negative feelings about people, things, and issues.
a. Attitudes
b. Norms
c. Beliefs
d. Traits
16. A manager from a prestigious university believed that employees who were from “lesser
schools” lacked sufficient intelligence and motivation for the high-tech firm that she led.
She set goals for these employees low, and did not trust them with certain important tasks
or company information. The employees, in fact, tended to show dissatisfaction and low
performance. At length, many of them quit. This would be an example of ___________.
a. Theory Y
b. the Pygmalion effect
c. negative self-concept
d. None of the above.
17. The University of Iowa studies led to an era of ___________ research.
a. behavioral
b. trait
c. personality
d. participation
18. __________ is credited as being the first to identify the participative leadership style that is
commonly used today.
a. Maslow
b. Vroom
c. Herzberg
d. Likert
19. Based on extensive research, Blake and Mouton would expect the best performance from a
firm whose leadership ____________.
a. displays an ultimate priority of meeting employees’ needs
b. sets the highest priority on task completion
c. puts a balanced and moderate managerial effort between meeting employees’ needs
and task completion
d. puts the highest priority on both meeting employees’ needs and task completion
20. Which of the following is NOT one of the four major assumptions that Abraham Maslow
based his hierarchy of needs theory on?
a. People’s needs are arranged in order of importance going from basic to complex
needs.
b. People will not be motivated to satisfy a higher-level need unless the lower-level
need(s) has been at least minimally satisfied.
c. Both met and unmet needs motivate.
d. People have five classifications of needs.
21. To motivate his highest performers, a manager gives his highest performer each month an
“Employee of the Month” award and a parking space next to his. Of what motivational
theory is this an example?
a. goal-setting
b. equity
c. expectancy
d. Reinforcement theory
22. Which of the following is NOT a category of needs in the acquired needs theory?
a. success
b. power
c. achievement
d. affiliation
23. To motivate employees with a high n Pow, you should do all of the following EXCEPT:
a. Let them plan and control their jobs as much as possible.
b. Try to include them in decision making.
c. Try to assign them to a whole task rather than just a part of a task.
d. Let them work as part of a team.
24. The process motivation theories are alike in that all focus on ___________.
a. understanding how people choose behavior to fulfill their needs
b. explaining and predicting behavior based on people’s needs
c. reinforcement of positive behaviors
d. giving praise
25. Today, more companies are looking for graduates with ___________.
a. more collective responsibility
b. international openness and flexibility
c. more holistic concern for employees
d. longer periods of employment
26. Which of the following is NOT one of the variables that determine situational favorableness?
a. task structure
b. locus of control
c. position power
d. leader−member relations
27. Which of the following best represents a situation in which a relationship-oriented
leadership style should be used?
a. A leader with strong power has good relations with a nonrepetitive task worker.
b. A leader with strong power has poor relations with a repetitive task worker.
c. A leader with strong power has good relations with a repetitive task worker.
d. A leader with weak power has poor relations with a nonrepetitive task worker.
28. The leader who permits followers to make ongoing decisions within defined limits uses
which style on the leadership continuum model?
a. 4
b. 7
c. 6
d. 1
29. Authoritarianism is the degree to which employees ___________.
a. defer to others
b. want to be told what to do
c. want to be told how to do the job
d. All of the above.
30. ___________ leadership is appropriate when followers are open to autocratic leadership,
have external locus of control, and follower ability is high.
a. Directive
b. Supportive
c. Participative
d. Achievement-oriented
31. The normative leadership model uses decision trees that are ___________.
a. time-driven and developmental-driven
b. leader-driven and follower-driven
c. task-driven and people-driven
d. goal-driven and decision-driven
32. The normative leadership model includes all of the following leadership styles EXCEPT:
a. decide
b. consult group
c. facilitate
d. participative
33. As a manager, you can influence people to do things that they normally would not have done
through your use of ___________ power, which is derived from top management.
a. personal
b. position
c. political
d. coercive
34. The consultation influencing tactic is also known as ___________.
a. participative management
b. coalition building
c. group influencing
d. consultant power
35. When you develop a rational persuasion, you should do all of the following EXCEPT:
a. focus on how you and the organization benefit by achieving the objective
b. offer a detailed step-by-step plan
c. explain how potential problems and concerns will be handled
d. demonstrate how to do a task, when possible
36. To increase your reward power, __________.
a. exercise your authority regularly
b. develop your people skills
c. let people know you control rewards
d. use rewards for personal benefit
37. __________ power is based on the user’s relationship with influential people.
a. Reward
b. Legitimate
c. Referent
d. Connection
38. Politics __________.
a. is a medium of exchange
b. has a negative connotation
c. is inherently neither good nor bad
d. All of the above.
39. Money and power have a similar use in that both are used ___________.
a. to obtain desires
b. as a medium of exchange
c. to accomplish objectives
d. to exert control
40. Which of the following is a guideline for developing political skills?
a. learn the organizational culture
b. gain recognition
c. tune out the grapevine
d. secretly pursue your self-interests
41. The manager of a manufacturing plant is inaugurating a major quality initiative and is
planning the announcement to the employees. She has considered the goal and mode of
the message. What other issue should be considered in this planning?
a. who should receive the message
b. the timing of the message
c. whether to solicit feedback
d. All of the above.
42. The value of stating the objectives of communication is to ________.
a. establish rapport
b. get buy-in from the recipient
c. elicit feedback before continuing the communication
d. help the receiver put the details into context
43. To check for the receiver’s understanding in oral communication, you ask him or her:
a. “ Do you have any questions?”
b. direct questions
c. indirect questions
d. to paraphrase the message
44. All of the following are components of listening EXCEPT:
a. paying attention
b. asking questions
c. not assuming and interrupting
d. watching and attending to only verbal cues
45. Which of the following is a component of checking understanding?
a. asking questions
b. conveying meaning
c. watching nonverbal cues
d. paying attention
46. An employee has mismanaged a client relationship and lost the client. As the manager, you
want to use a self-evaluation type of coaching feedback. Which of the following might
apply?
a. “I told you to be careful with that relationship.”
b. “I guess that this just shows why we emphasize training.”
c. “When you lose clients, that makes me frustrated.”
d. “Why do you suppose that client dropped us and went to our competitor?”
47. Which of the following is used to explain the process managers go through in determining
the reasons for effective or ineffective performance and deciding what to do about it?
a. attribution theory
b. psychological contract
c. performance formula
d. BCF model
48. In the performance formula, John and his team are not performing as well as other teams.
Based on your assessment of the situation, you believe that John and his team have the
ability to perform well and seem to be motivated to do the work. What should you do next?
a. Get John’s commitment to change.
b. Have John and his team sign a psychological contract.
c. Check to see what resources they may be lacking.
d. Send them to training.
49. Which of the following statements best describes the vertical dyadic linkage theory?
a. The focus is on the quality of each dyad.
b. Leaders aspire to build positive relationships with all followers.
c. Linkages among peers are disavowed.
d. Leader−follower interactions create in-groups and out-groups.
50. Leaders mostly use all of the following types of power to influence out-group members
EXCEPT:
a. legitimate power
b. referent power
c. reward power
d. coercive power
51. Which of the following statements regarding in-groups and out-groups is NOT true?
a. In-group followers routinely receive higher performance ratings than out-group
followers.
b. In-group followers do not require as much attention as out-group followers.
c. In-group followers give more positive ratings when evaluating organizational climate
than out-group followers.
d. Out-group followers routinely show higher levels of turnover than in-group followers.
52. All of the following are factors that determine LMX quality EXCEPT:
a. follower attributes
b. situational factors
c. organizational culture
d. leader and follower perceptions of each other
53. As Jim’s leader, you have noticed that he is low on involvement and high on critical
thinking, and you have concluded that Jim is a(n) __________ follower.
a. alienated
b. conformist
c. passive
d. pragmatic
54. The __________ follower is someone who is high on critical thinking and involvement.
a. alienated
b. conformist
c. effective
d. pragmatic
55. When challenging a leader’s flawed plans and proposals, it is important for the follower to
___________.
a. pinpoint specifics
b. personalize the critique
c. provide both positive and negative feedback
d. ask for suggestions
56. People with a(n) ___________ locus of control believe that they are “masters of their own
destiny” and can influence people and events in their workplace.
a. internal
b. external
c. neutral
d. optimal
57. Which of the following describes a team vs. a group?
a. A group implies a sense of collective responsibility.
b. A team tends to have shared responsibilities.
c. A team implies a sense of shared mission.
d. b and c only
58. Shirking of individual responsibility is also known as ___________.
a. groupthink
b. synergy
c. social loafing
d. task facilitation
59. Which of the following statements regarding team diversity is NOT true?
a. A disadvantage of team diversity is the increased likelihood of groupthink.
b. Team diversity brings diverse points of view to bear on problems.
c. Teams that do not manage diversity well have a good chance for intrateam conflicts.
d. Not all diverse teams perform well.
60. One of the prescriptions for success in using the leader-centered decision-making model is
that the leader should ___________.
a. discourage members from expressing their feelings
b. relinquish control to the team and allow it to make the final choice in all appropriate
kinds of decisions
c. listen attentively and observe nonverbal cues to be aware of member needs, feelings,
interactions, and conflict
d. All of the above.
61. Before calling a meeting, the leader should do all of the following EXCEPT:
a. decide who should attend the meeting.
b. identify the activities that will take place during the meeting.
c. set aside at least 3−4 hours to prepare for the meeting.
d. clearly define the purpose and set objectives to be accomplished during the meeting.
62. During meetings, the team leader should focus on all of the following EXCEPT:
a. group structure
b. group process
c. group development
d. group effectiveness
63. Which of the following does NOT describe a self-managed team?
a. fixed team design
b. team accountability
c. multiskilled skills
d. leadership within the team
64. A self-managed team ___________ is an advocate of the self-managed team concept whose
responsibility is to help the team obtain necessary resources, gain political support from
top management and other stakeholders of the organization, and defend it from enemy
attacks.
a. facilitator
b. leader
c. champion
d. director
65. Max Weber defined “charisma” as a form of influence based on ___________.
a. traditional authority systems
b. follower perceptions
c. leader−member exchange
d. legal−rational authority systems
66. Which of the following is NOT one of the behavior attributes that distinguish charismatic
from noncharismatic leaders?
a. use of unconventional strategies for achieving desired change
b. dissatisfaction with the status quo
c. compelling nature of the vision
d. use of rewards and incentives for motivating followers
67. The debate concerning the locus of charismatic leadership states that charisma could be the
result of all of the following EXCEPT:
a. the emotional involvement of the followers
b. the leader’s extraordinary qualities
c. the situation or social climate facing the leader
d. an interaction of the situation and the leader’s qualities
68. An effect of charismatic leadership on followers is to cause them to ___________.
a. assume greater risk
b. set or accept higher goals
c. have greater confidence in their ability to contribute to the achievement of goals
d. All of the above.
69. Socialized charismatic leaders __________.
a. pursue leader-driven goals
b. promote feelings of empowerment, personal growth, and equal participation in
followers
c. restrict information
d. All of the above.
70. In the four stage model of the transformation process, which of the following is the first
stage?
a. institutionalize change
b. challenge the status quo and make a convincing case for change
c. inspire a shared vision of the future
d. provide effective leadership during the change
71. Transactional leaders ___________.
a. appeal to higher ideals and moral values
b. get followers to act by giving them something that they desire in exchange for
compliance
c. attempt to think “outside of the box”
d. rely heavily on the articulation of a vision to inspire subordinates
72. The key to successful stewardship is based on all of the following values EXCEPT:
a. strong teamwork orientation
b. effective listening
c. equality assumption
d. reward assumption
73. Which of the following is a function of culture?
a. It keeps diversity from becoming extreme.
b. It results in strategic alignment.
c. It helps the organization adapt to the external environment.
d. All of the above.
74. Insular thinking is an attribute of a(n) __________ culture.
a. low-performance
b. high-performance
c. bureaucratic
d. adaptive
75. All of the following are substantive leadership actions for shaping culture EXCEPT:
a. matching HR practices to culture.
b. aligning reward/incentive system with culture.
c. developing a written values statement.
d. interacting face-to-face with rank-and-file.
76. A new CEO is appointed to Xex Corporation. Which of the following should occur for there to be successful outcomes in changing Xex’s organizational culture?
a. The CEO traits and values fit the organization’s values.
b. The CEO frequently attends both ceremonial and non-ceremonial events.
c. The CEO’s behaviors match his/her espoused values.
d. All of the above.
77. _________ culture represents a leadership belief in strong, mutually reinforcing exchanges
and linkages between employees and departments.
a. Cooperative
b. Adaptive
c. Competitive
d. Bureaucratic
78. Organizations with __________ cultures are highly structured and efficiency driven.
a. competitive
b. adaptive
c. bureaucratic
d. cooperative
79. An employee’s disclosure of illegal or unethical practices on the part of the organization is
called ___________.
a. ethical disclosure
b. whistle blowing
c. moral reasoning
d. individualism
80. ___________ has a high power-distance culture.
a. Germany
b. The United States
c. Ireland
d. France
81. Strategic ___________ is the process of providing the direction and inspiration necessary to
create and implement a firm’s vision, mission, and strategies to achieve organizational
objectives.
a. management
b. leadership
c. necessity
d. vision
82. The effective strategist must be capable of which of the following?
a. communicating effectively
b. deciding on appropriate goals and priorities
c. anticipating and forecasting events in the external environment
d. All of the above.
83. Strategic __________ is the set of decisions and actions used to formulate and implement
specific strategies that will achieve a competitively superior fit between the organization
and its environment so as to achieve organizational goals.
a. leadership
b. analysis
c. management
d. vision
84. Goal-setting theory asserts that people with __________ goals perform better than those with
__________ goals.
a. strategic; corporate
b. vague; strategic
c. specific; strategic
d. stretch; vague
85. Competitive advantage is improved when a firm’s __________.
a. core competencies match external environmental opportunities
b. vision is benchmarked from industry-best practices
c. strategic moves match those of its best competitors
d. All of the above.
86. __________ change is an alteration in an organization’s alignment with its external
environment.
a. Strategic
b. Organizational
c. Functional
d. None of the above.
87. Which of the following is a phase or stage of the change process?
a. unfreezing
b. changing
c. refreezing
d. All of the above.
88. Which of the following is/are stages in Lewin’s classic theory of change?
a. unfreezing
b. establishing a sense of urgency
c. changing, moving to a new, desired state
d. a and c only
89. In the three stage model of change, the __________ phase is also known as cognitive
restructuring because it is where the actual change takes place.
a. unfreezing
b. changing
c. refreezing
d. Sense of urgency
90. Effective leaders can create psychological safety for employees who fear change by
__________.
a. providing opportunities for training and education
b. slowing the pace of change as much as possible
c. downplaying any resistance
d. implementing incremental, rather than radical, change
91. Strategic crisis leadership requires all of the following EXCEPT:
a. integrating crisis management into the strategic management process so it remains a
regular part of the overall strategy−evaluation process
b. using environmental monitoring techniques to identify events that could trigger crises
in the future
c. identifying emerging patterns or trends in the regulatory environment, competitive
landscape, and social environment
d. establishing a culture that embraces crisis awareness and preparation as a way of
life
92. Emerging trends in the current business environment that make crisis management
especially important among the skills of leadership include ___________.
a. technological advances
b. the economic downturn
c. the overall desirability of learning about risk matrices
d. All of the above.
93. The primary duties of the crisis leader may include activities such as ___________.
a. coordinating the activities of the crisis management team to ensure that the members
work well together
b. requiring individuals or departments to keep logs of complaints or incidents
c. monitoring customer and employee complaints and behavior
d. All of the above.
94. Which of the following is NOT one of the steps in the risk assessment process?
a. risk reduction
b. risk identification
c. crisis management
d. risk analysis
95. The best gauge to determine an organization’s readiness to respond to a crisis is how it rates
according to which of the following factors?
a. awareness and access to crisis management information
b. readiness for a quick response
c. effective communication plan in place
d. All of the above.
96. A __________ is a printed statement that describes how an organization is responding to a
crisis and who is in charge.
a. press release
b. crisis bulletin
c. press kit
d. crisis release
97. Which of the following is a characteristic of a traditional organization?
a. flat horizontal structure
b. personal and group networks of free, open exchanges with no filters
c. centralized decision making
d. loose, flexible, and adaptive roles
98. All of the following are characteristics of traditional organizations EXCEPT:
a. adaptive culture that encourages continuous improvement and change
b. stable environment
c. vertical structure
d. rigid culture that is not responsive to change
99. ___________ change occurs when anticipated or expected changes bear no resemblance to
the present or the past.
a. Acquisitional
b. Radical
c. Organizational
d. Discontinuous
100. The encouragement of systems thinking __________.
a. is a task of leaders who seek to enhance organizational learning
b. has the best results in traditional organizations
c. was a driving force in the 1980s, but has been largely discarded in favor of
specialized thinking
d. increases efficiency, but appears to deter creativity
Economics-1 Proctored Final Examination
Part A, answer in one to three paragraphs
Assuming no government intervention, describe the market behavior that should result if the price of a product is below its equilibrium price; then describe the behavior that should occur if the price is above its equilibrium price.
2. How does inflation affect people’s standards of living and savings?
3. Define stock, bond, and mutual fund. What are the benefits and risks associatied with each of these investments?
Part B, answer in one to four sentences
1. Suppose the economy is experiencing inflation. What would be the interpretation of how a ristrictive monetary policy would address this problem?
2. Describe two types of specialization in production. What are the economic advantages of specialization?
3. What are political business cycles, and how could the be created?
4. Why are financial institutions required to keep reserves?
5. What is a price ceiling, and what are its economic effects?
6. Define the concept of offshoring, and explain the economic reasons why businesses use offshoring?
7. What is meant by economies of scale, and what is the importance of this concept to economic growth?
8. Define and explain eacy of the following: frictional unemployment, structural unemployment, and cyclical unemployment.
9. What is the multiplier effect, and how does it affect the GDP?
10. Define the term business cycle, and list the four phases of the business cycle.
Get Answer From: http://homework.ecrater.com/p/20380754/hw-1285-economics-1-proctored-final-examination
Yield point, elastic limit, and rupture point
Explain the significance of the terms yield point, elastic limit, and rupture point as they relate to stress.
3 pages with 2 references.
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Option-2 Economic critique
Option 2: Economic Critique
Imagine that your Learning Team is a group of international reporters. You have been tasked with describing and critiquing the current state of the U.S. economy.
Describe the current state of the following economic factors:
• Unemployment
• Expectations
• Consumer Income
• Interest Rates
Identify the existing effect of the economic factors on aggregate demand and supply
Identify fiscal policies that are currently being recommended by government leadership.
Evaluate the effectiveness of those fiscal policy recommendations from the Keynesian and Classical model perspectives.
Write a 1,050- to 1,400-word newsletter that summarizes the results.
Get Answer From: http://homework.ecrater.com/p/20382334/hw-1286-option-2-economic-critique
Leadership in creating learning organization
Describe the role of leadership in creating a learning organization.
4 pages with 3 references.
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Charasmatic and transformational leader
Distinguish between charismatic and transformational leadership.
3 pages with 2 references. One from Lussier & Achua.
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International Business Expansion Plan in India
Over the past several weeks, you have been learning about the various issues surrounding the challenges and numerous situations that exist legally that differ from those of the United States. You have been placed in charge of the Business Development and Expansion committee for your company. You are charged with the task of researching and identifying a country to expand your company’s operations. At this phase, you will be submitting a rough draft of this international business expansion plan for review by your instructor. Take the feedback into consideration from the instructor, and make any additions or deletions as you deem necessary.
Your international business expansion plan should include the concepts and ideas that were covered over the past several weeks. You are to select a country that does not recognize all of the established legal guidelines reviewed previously, but the potential profit that could be realized warrants the risk. The following points need to be addressed in your international business expansion plan:
The issue of common and civil law systems internationally
Intellectual property, copyright infringements, and legal ramifications
Violation of human rights of employees and child labor law violations
Public perception of companies doing business with companies that engage in that kind of activity
What has been the impact of the European Union of the business environment?
Anything else that you deem important to support your international business expansion plan
The deliverable length is 1,250–1,600 words.
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Characteristics of behavioral management
List and describe the characteristics of behavioral management.
3 pages with 2 references.
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Homework Assignments and Papers 