Micro Test 3 (real test) Flashcards
According to the statistics, the distribution of money income:
c. has not changed greatly since 1947
The highest fifth of all families receive approximately ____ of the distribution of annual money income among families
d. 50 percent
The Lorenz curve shows the
d. actual cumulative percentage of income received compared to a perfectly equal cumulative percentages of income
Of the following demographic groups, which has the lowest poverty rate in the U.S.?
d. Families in which the “head of the household” has attained at least a bachelor’s degree form a college or university
Which of the following are NOT counted when we compare a family’s income to the poverty line?
a. In-kind transfer such as food stamps, Medicaid, and public housing
The social security tax is called FICA, which stands for:
d. Federal Insurance Contributions Act
Which of the following is an in-kind transfer payment?
a. Medicaid
Under a negative income tax program,
a. the government guarantees a minimum level of family income
Comparable worth is the principle that:
d. employees who perform comparable jobs should be paid the same wage
Starting in 1964, the U.S. government has defined the poverty line as income at or below ____ the amount of money needed to buy a minimum diet for all family members.
b. three times
Firms that place their assets in the custody of a board of trustees is called a(n):
c. trust
The practice of firms temporarily reducing prices in order to eliminate competition is called:
b. predatory pricing
Officers of five large building-materials companies meet and agree than none of them will submit bids on government contracts lower than an agreed-upon level. This is an example of:
a. price fixing
What act of Congress declared restraint of trade illegal and declared any attempt at monopolizing unlawful?
b. Sherman Antitrust Act
The primary purpose of antitrust legislating is to:
b. protect the competitiveness of U.S. businesses
The Clayton Act of 1914:
c. prohibited price discrimination that reduces competition and cannot be justified based on cost differences
Which of the following practices is prohibited by the Clayton Act?
- Price discrimination that substantially lessens competition
- Trying contacts that substantially lessen competition
- Exclusive dealing that substantially lessens competition
d. All of these
Campbell Soup agrees to sell its brand to a grocery chain only if the chain also agrees to buy a minimum number of cases of its V-8 juice. This is an example of:
d. price discrimination
Which of the following is NOT one of the four anti-competitive activities outlined in the Clayton Act?
d. Buying a competitor’s plants and equipment
Today, the Federal Trade Commission (FTC) is concerned with:
- enforcing consumer protection legislation
- prohibiting deceptive advertising
- preventing collusion
d. all of these
Which of the following antitrust laws broadened the list of illegal price discrimination practices and is often called the “Chain Store Act”?
c. The Robinson-Patman Act
If a firm engages in a merger that substantially reduces competition, then it would be in violation of the:
e. Celler-Kefauver Antimerger Act
When the court determines that a firm’s size alone is sufficient to find that it violated antitrust laws, this criterion is called:
c. per se
A merger between firms that compete in the same market is called a:
a. horizontal merger
A merger of firms with a supplier is a:
a. vertical merger
Which of the following BEST describes social benefits?
b. The sum of external benefits and private benefits
Economists view pollution as an economic problem that arises because:
d. firms that pollute do not pay the full social cost of producing their output
People are unlikely to choose to pay extra for a low-emissions automobile, because they:
b. are better off “free-riding” on others’ attempts to reduce emissions
Negative externalities impose MOST of their costs:
d. on individuals other than consumers of the polluting product
Which of the following is the environmental approach found in the Clean Air Act of 1990?
a. marketable pollution permits
When using the traditional command-and-control approach to environmental regulations, the government attempts to:
d. set standards that are applicable to all situations and does not recognize unique circumstances
According the Coase Theorem, the private sector can achieve social efficiency if the government:
a. establishes and enforces property rights
