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

1. If the demand for a good is elastic, what is true?

A) The quantity demanded responds only slightly to changes in the price.
B) The quantity demanded responds substantially to changes in the price.
C) Total revenue increases with a change in price in either direction.
D) Price and total revenue move in the same direction.

2. What is an example of goods that tend to have negative cross-price elasticities?

A) Inferior goods
B) Luxury goods
C) Complements
D) Substitutes

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

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

4. What does the Federal Reserve do to expand aggregate demand? (Choose TWO.)

A) Decrease the money supply
B) Raise mortgage rates
C) Increase the money supply
D) Lower the interest rate
E) Reduce the quantity of reserves
F) Increase the foreign exchange rate

5. What are costs to home countries of foreign direct investment (FDI)? (Choose TWO.)

A) Reduced standard of living
B) Loss of intellectual property
C) Job loss
D) Capital outflow
E) Cultural disintegration
F) Loss of sovereignty

Solutions: