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WGU Global Economics for Managers (C211, UZC2) Sample Questions:

1. The marginal revenue from producing a smartphone is $200, and the marginal cost is $150. What is the best action for the firm?

A) Exit the market altogether
B) Increase production
C) Decrease production
D) Pause production

2. What is one characteristic of a market shortage?

A) There is downward pressure on price.
B) Quantity supplied is less than equilibrium quantity.
C) Price is greater than the equilibrium price.
D) Quantity demanded is less than equilibrium quantity.

3. What is the profit maximization condition for a monopoly?

A) When total revenue is maximized
B) When price equals marginal cost
C) When marginal revenue equals marginal cost
D) When marginal cost is minimized

4. The formula "fixed costs (FC) + variable costs (VC)" represents which quantity?

A) Marginal cost
B) Average cost
C) Total cost
D) Implicit cost

5. The marginal cost of producing a computer is $600, but the marginal revenue is $1,000. What is the best action for the respective firm?

A) Increase production
B) Exit the market
C) Decrease production
D) Pause production

Solutions: