WGU C211 GLOBAL ECONOMICS FOR MANAGERS
EXAM QUESTIONS AND CORRECT DETAILED
ANSWERS WITH FREQUENTLY TESTED QUESTIONS
AND RATIONALE ALREADY GRADED A FOR
GUARANTEED PASS LATEST UPDATE 2025.
What is the change in total cost equal to in the
marginal cost equation? - CORRECT ANSWER Marginal cost multiplied by change
in quantity.
Fixed costs equal: - CORRECT ANSWER Total costs minus variable costs
Economic profit is distinct from accounting
profit because: - CORRECT ANSWER Economic profit incorporates both
explicit and implicit costs.
Which statement is true? - CORRECT ANSWER Total surplus is the sum of
consumer and producer surplus and is graphically represented as the
area between the supply and demand curves up to the
equilibrium quantity.
Suppose that Bob lives in the United States,
but has been working in Mexico for the last 5 years. Where is the value of Bob's
production counted during the last 5 years? - CORRECT ANSWER U.S. GNP and
Mexico's GDP.
Which of the following statements describes
gross domestic product (GDP)? - CORRECT ANSWER GDP is the most used
measure of a country's economic wellbeing.
Which of the following is an investment
included in the gross domestic product
(GDP)
measure? - CORRECT ANSWER Spending on new
residential construction.
Gross Domestic Product (GDP) measures
which of the following? - CORRECT ANSWER Market value of final goods and
services produced within a country in a given period of time.
Which item is NOT part of GDP? - CORRECT ANSWER Purchasing a used hairdryer.
What is the key distinction between real and
nominal GDP? - CORRECT ANSWER Real GDP measures production not
affected by changes in prices while nominal GDP
measures production measured at current prices.
, WGU C211 GLOBAL ECONOMICS FOR MANAGERS
EXAM QUESTIONS AND CORRECT DETAILED
ANSWERS WITH FREQUENTLY TESTED QUESTIONS
AND RATIONALE ALREADY GRADED A FOR
GUARANTEED PASS LATEST UPDATE 2025.
Total costs include: - CORRECT ANSWER Variable costs plus fixed costs.
Marginal costs consider: - CORRECT ANSWER The increase in total cost arising
from an extra unit of production.
What response best describes the relationship
between marginal costs and total costs? - CORRECT ANSWER Whenever marginal
cost is less than
average total cost, average total cost is falling.
Which statement is true about productivity? - CORRECT ANSWER The value of
marginal product of labor
equals wage in a competitive firm.
A production function expresses the
relationship between: - CORRECT ANSWER Quantity of resource inputs and
product/service outputs.
Opportunity costs include: - CORRECT ANSWER The income the entrepreneur
could have earned working for an employer.
Economists and decision makers study
and then make decisions or judgments
based on
(select best answer): - CORRECT ANSWER Marginal analysis.
The primary reason that the marginal cost
curve declines and then increases is: - CORRECT ANSWER Firms experience
increasing marginal
product, then diminishing marginal product.
Which of the following statements is
accurate? - CORRECT ANSWER Marginal costs eventually rise with
the quantity of output.
Consider the following example: A
perfectly competitive firm finds that at
current production levels marginal cost is
greater than marginal revenue. What
action should this firm take in order to
pursue the
maximization of profit? - CORRECT ANSWER Decrease the target output.
A competitive firm is characterized by: - CORRECT ANSWER Trading of identical products.
Competitive firms experience marginal
revenue that is: - CORRECT ANSWER Equal to price.
, WGU C211 GLOBAL ECONOMICS FOR MANAGERS
EXAM QUESTIONS AND CORRECT DETAILED
ANSWERS WITH FREQUENTLY TESTED QUESTIONS
AND RATIONALE ALREADY GRADED A FOR
GUARANTEED PASS LATEST UPDATE 2025.
In the short-run, a competitive firm would
continue to produce under the following
circumstance: - CORRECT ANSWER Total revenue exceeds total
variable costs.
What fundamental shape does a demand
curve take in a competitive market? - CORRECT ANSWER Horizontal.
For a perfectly competitive firm which
condition is true? - CORRECT ANSWER The demand curve is the same
as the marginal revenue curve.
Which condition is true for perfectly
competitive firms in the long-run? - CORRECT ANSWER They will exit the market if
total revenue is less than total costs.
Which statement is true concerning marginal
costs? - CORRECT ANSWER Marginal costs typically decline
and then increase with the quantity of output.
What rule is used by perfectly competitive
firms to determine shut-down in the shortrun? - CORRECT ANSWER Price is less than
average variable
costs.
What is true of perfectly competitive firms in
the long-run? - CORRECT ANSWER Economic profits will not be achievable.
What two market structures have common
profit characteristics in the long run? - CORRECT ANSWER Perfect competition and
monopolistic
competition.
Consider the structure/shape of the
demand curve for the various firm types.
In what way does a monopoly's demand
curve differ from a
perfectly competitive firm's demand curve? - CORRECT ANSWER The monopoly's
demand curve is
downward sloping and the competitive firm's demand
curve is horizontal.
Monopolistic firms seek to maximize profit.
What condition allows them to achieve this
goal? - CORRECT ANSWER When marginal revenue equals
marginal cost.
, WGU C211 GLOBAL ECONOMICS FOR MANAGERS
EXAM QUESTIONS AND CORRECT DETAILED
ANSWERS WITH FREQUENTLY TESTED QUESTIONS
AND RATIONALE ALREADY GRADED A FOR
GUARANTEED PASS LATEST UPDATE 2025.
In pursuing the maximization of profit,
monopolies set price at a point that is: - CORRECT ANSWER Above marginal cost.
Consider demand for the various firm
types. How does a monopoly's demand
curve compare to the demand curve for a
perfectly
competitive firm? - CORRECT ANSWER It is less elastic.
A monopoly's demand curve is: - CORRECT ANSWER The same as the market demand
curve.
Suppose that the United States imposes
a tariff on avocados imported from
Mexico.
What impact will this have on the price paid
for avocados by United States citizens? - CORRECT ANSWER The price will increase.
Which of the following is a consequence of a
country imposing a tariff on imported goods? - CORRECT ANSWER The demand for foreign
produced goods
decreases.
Suppose that the United States imposes
a tariff on salt. What impact might this
tariff
have on the price for domestic consumers? - CORRECT ANSWER Consumers will
pay a higher price.
Applying a tariff to coconuts will have the
following effect: - CORRECT ANSWER Increase the domestic price of
coconuts.
Which of the following is NOT a restriction
to trade? - CORRECT ANSWER Free trade
areas.
What is the significant difference between an
import quota and a tariff? - CORRECT ANSWER A tariff raises revenue for
the government and an import quota creates surplus for
those who obtain licenses to import.
Suppose that the price of a good
increases (all else held constant). Which
of the following
would happen along with the change in price? - CORRECT ANSWER Consumer surplus
would decrease.
EXAM QUESTIONS AND CORRECT DETAILED
ANSWERS WITH FREQUENTLY TESTED QUESTIONS
AND RATIONALE ALREADY GRADED A FOR
GUARANTEED PASS LATEST UPDATE 2025.
What is the change in total cost equal to in the
marginal cost equation? - CORRECT ANSWER Marginal cost multiplied by change
in quantity.
Fixed costs equal: - CORRECT ANSWER Total costs minus variable costs
Economic profit is distinct from accounting
profit because: - CORRECT ANSWER Economic profit incorporates both
explicit and implicit costs.
Which statement is true? - CORRECT ANSWER Total surplus is the sum of
consumer and producer surplus and is graphically represented as the
area between the supply and demand curves up to the
equilibrium quantity.
Suppose that Bob lives in the United States,
but has been working in Mexico for the last 5 years. Where is the value of Bob's
production counted during the last 5 years? - CORRECT ANSWER U.S. GNP and
Mexico's GDP.
Which of the following statements describes
gross domestic product (GDP)? - CORRECT ANSWER GDP is the most used
measure of a country's economic wellbeing.
Which of the following is an investment
included in the gross domestic product
(GDP)
measure? - CORRECT ANSWER Spending on new
residential construction.
Gross Domestic Product (GDP) measures
which of the following? - CORRECT ANSWER Market value of final goods and
services produced within a country in a given period of time.
Which item is NOT part of GDP? - CORRECT ANSWER Purchasing a used hairdryer.
What is the key distinction between real and
nominal GDP? - CORRECT ANSWER Real GDP measures production not
affected by changes in prices while nominal GDP
measures production measured at current prices.
, WGU C211 GLOBAL ECONOMICS FOR MANAGERS
EXAM QUESTIONS AND CORRECT DETAILED
ANSWERS WITH FREQUENTLY TESTED QUESTIONS
AND RATIONALE ALREADY GRADED A FOR
GUARANTEED PASS LATEST UPDATE 2025.
Total costs include: - CORRECT ANSWER Variable costs plus fixed costs.
Marginal costs consider: - CORRECT ANSWER The increase in total cost arising
from an extra unit of production.
What response best describes the relationship
between marginal costs and total costs? - CORRECT ANSWER Whenever marginal
cost is less than
average total cost, average total cost is falling.
Which statement is true about productivity? - CORRECT ANSWER The value of
marginal product of labor
equals wage in a competitive firm.
A production function expresses the
relationship between: - CORRECT ANSWER Quantity of resource inputs and
product/service outputs.
Opportunity costs include: - CORRECT ANSWER The income the entrepreneur
could have earned working for an employer.
Economists and decision makers study
and then make decisions or judgments
based on
(select best answer): - CORRECT ANSWER Marginal analysis.
The primary reason that the marginal cost
curve declines and then increases is: - CORRECT ANSWER Firms experience
increasing marginal
product, then diminishing marginal product.
Which of the following statements is
accurate? - CORRECT ANSWER Marginal costs eventually rise with
the quantity of output.
Consider the following example: A
perfectly competitive firm finds that at
current production levels marginal cost is
greater than marginal revenue. What
action should this firm take in order to
pursue the
maximization of profit? - CORRECT ANSWER Decrease the target output.
A competitive firm is characterized by: - CORRECT ANSWER Trading of identical products.
Competitive firms experience marginal
revenue that is: - CORRECT ANSWER Equal to price.
, WGU C211 GLOBAL ECONOMICS FOR MANAGERS
EXAM QUESTIONS AND CORRECT DETAILED
ANSWERS WITH FREQUENTLY TESTED QUESTIONS
AND RATIONALE ALREADY GRADED A FOR
GUARANTEED PASS LATEST UPDATE 2025.
In the short-run, a competitive firm would
continue to produce under the following
circumstance: - CORRECT ANSWER Total revenue exceeds total
variable costs.
What fundamental shape does a demand
curve take in a competitive market? - CORRECT ANSWER Horizontal.
For a perfectly competitive firm which
condition is true? - CORRECT ANSWER The demand curve is the same
as the marginal revenue curve.
Which condition is true for perfectly
competitive firms in the long-run? - CORRECT ANSWER They will exit the market if
total revenue is less than total costs.
Which statement is true concerning marginal
costs? - CORRECT ANSWER Marginal costs typically decline
and then increase with the quantity of output.
What rule is used by perfectly competitive
firms to determine shut-down in the shortrun? - CORRECT ANSWER Price is less than
average variable
costs.
What is true of perfectly competitive firms in
the long-run? - CORRECT ANSWER Economic profits will not be achievable.
What two market structures have common
profit characteristics in the long run? - CORRECT ANSWER Perfect competition and
monopolistic
competition.
Consider the structure/shape of the
demand curve for the various firm types.
In what way does a monopoly's demand
curve differ from a
perfectly competitive firm's demand curve? - CORRECT ANSWER The monopoly's
demand curve is
downward sloping and the competitive firm's demand
curve is horizontal.
Monopolistic firms seek to maximize profit.
What condition allows them to achieve this
goal? - CORRECT ANSWER When marginal revenue equals
marginal cost.
, WGU C211 GLOBAL ECONOMICS FOR MANAGERS
EXAM QUESTIONS AND CORRECT DETAILED
ANSWERS WITH FREQUENTLY TESTED QUESTIONS
AND RATIONALE ALREADY GRADED A FOR
GUARANTEED PASS LATEST UPDATE 2025.
In pursuing the maximization of profit,
monopolies set price at a point that is: - CORRECT ANSWER Above marginal cost.
Consider demand for the various firm
types. How does a monopoly's demand
curve compare to the demand curve for a
perfectly
competitive firm? - CORRECT ANSWER It is less elastic.
A monopoly's demand curve is: - CORRECT ANSWER The same as the market demand
curve.
Suppose that the United States imposes
a tariff on avocados imported from
Mexico.
What impact will this have on the price paid
for avocados by United States citizens? - CORRECT ANSWER The price will increase.
Which of the following is a consequence of a
country imposing a tariff on imported goods? - CORRECT ANSWER The demand for foreign
produced goods
decreases.
Suppose that the United States imposes
a tariff on salt. What impact might this
tariff
have on the price for domestic consumers? - CORRECT ANSWER Consumers will
pay a higher price.
Applying a tariff to coconuts will have the
following effect: - CORRECT ANSWER Increase the domestic price of
coconuts.
Which of the following is NOT a restriction
to trade? - CORRECT ANSWER Free trade
areas.
What is the significant difference between an
import quota and a tariff? - CORRECT ANSWER A tariff raises revenue for
the government and an import quota creates surplus for
those who obtain licenses to import.
Suppose that the price of a good
increases (all else held constant). Which
of the following
would happen along with the change in price? - CORRECT ANSWER Consumer surplus
would decrease.
