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Posted by admin on January 8, 2018 in Articles

ECO 550 Mid-Term Quiz 1 and 2

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MIDTERM QUIZ 1This midterm exam consist of 32 multiple choice questions and covers the material in Chapters 1 through 8. There are four questions from each chapter.1The flat-screen plasma TVs are selling extremely well. The originators of this technology are earning higher profits. What theory of profit best reflects the performance of the plasma screen makers

2To reduce Agency Problems, executive compensation should be designed to:Correct Answer: create incentives so that managers act like owners of the firm.3Economic profit is defined as the difference between revenue and ____.4Which of the following will increase (V0), the shareholder wealth maximization model of the firm:V0•(shares outstanding) = ??t=1 (? t ) / (1+ke)t + Real Option Value.5A change in the level of an economic activity is desirable and should be undertaken as long as the marginal benefits exceed the ____.6The closest example of a risk-free security is7The primary difference(s) between the standard deviation and the coefficient of variation as measures of risk are:8The ____ is the ratio of ____ to the ____.9If demand were inelastic, then we should immediately:10Producers’ goods are:11Marginal revenue (MR) is ____ when total revenue is maximized.12Suppose we estimate that the demand elasticity for fine leather jackets is ?.7 at their current prices. Then we know that:13The method which can give some information in estimating demand of a product that hasn’t yet come to market is:14The standard deviation of the error terms in an estimated regression equation is known as:15All of the following are reasons why an association relationship may not imply a causal relationship except:16Demand functions in the…

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