ECO 550 Midterm exam Part 2 Question list (100% Correct)

1. For studying demand relationships for a proposed new product that no one has ever used before, what would be the best method to use
2. The forecasting technique which attempts to forecast short-run changes and makes use of economic indicators known as leading, coincident or lagging indicators is known as
3. The type of economic indicator that can best be used for business forecasting is the
4. Time-series forecasting models
5. The use of quarterly data to develop the forecasting model Yt = a +bYt−1 is an example of which forecasting technique
6. The variation in an economic time-series which is caused by major expansions or contractions usually of greater than a year in duration is known as
7. In a recession, the trade balance often improves because
8. In Chinese coastal provinces, brick housing for a fast expanding middle class is very comparable in size to housing in the U.S. for a family with median income of $51,000 because
9. Purchasing power parity or PPP says the ratios composed of
10. The import of Apple iPads assembled in Shanghai at a $295 wholesale price ($213 cost and $82 profit margin) adds more than it should to the U.S. trade deficit with China because
11. If Ben Bernanke, Chair of the Federal Reserve Board, begins to tighten monetary policy by raising US interest rates next year, what is the likely impact on the value of the dollar?
12. If the British pound (₤) appreciates by 10% against the dollar
13. Companies that reduce their margins on export products in the face of appreciation of their home currency may be motivated by a desire to
14. The marginal product is defined as
15. In a relationship among total, average and marginal products, where TP is maximized:
16. Given a Cobb-Douglas production function estimate of Q = 1.19L.72K.18 for a given industry, this industry would have:
17. If the marginal product of labor is 100 and the price of labor is 10, while the marginal product of capital is 200 and the price of capital is $30, then what should the firm?
18. The marginal rate of technical substitution may be defined as all of the following except
19. Marginal revenue product is defined as the amount that an additional unit of the variable input adds to ____.
20. The cost function is
21. According to the theory of cost, specialization in the use of variable resources in the short-run results initially in
22. The existence of diseconomies of scale (size) for the firm is hypothesized to result from
23. Economies of scale exist whenever long-run average costs
24. Economies of Scope refers to situations where per unit costs are
25. For a short-run cost function which of the following statements is (are) not true