CLEP Microeconomics chapter practice4 questions

01 How the CLEP Microeconomics Exam Thinks

These questions come directly from the chapter practice in the book. Choose the best answer, check your reasoning, and use the explanation to correct any gap.

Question 1

Question 1 of 4

A bakery is deciding whether to produce one additional tray of rolls. Which comparison directly answers the decision?

The decision concerns one added tray, so the relevant rule compares its marginal revenue with its marginal cost. Average and total measures answer different questions.
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B. Marginal revenue from the tray with the marginal cost of producing it

The decision concerns one added tray, so the relevant rule compares its marginal revenue with its marginal cost. Average and total measures answer different questions.

Question 2

Question 2 of 4

A city report states, “The bus-fare increase reduced weekday ridership by 8 percent.” This statement is best classified as

The claim describes an observable relationship and can be checked against ridership data. Government involvement does not make a statement normative.
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D. positive because evidence can confirm or reject the claimed change

The claim describes an observable relationship and can be checked against ridership data. Government involvement does not make a statement normative.

Question 3

Question 3 of 4

A student concludes that a minimum wage caused restaurant employment to fall. Which additional evidence would most strengthen that conclusion?

A comparison area helps separate the wage change from broader trends affecting restaurants everywhere. Before-and-after evidence alone cannot do that.
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A. Nearby areas without the wage change had no similar employment decline

A comparison area helps separate the wage change from broader trends affecting restaurants everywhere. Before-and-after evidence alone cannot do that.

Question 4

Question 4 of 4

A firm has spent 40,000 developing a device. Completing it would cost 12,000, and the completed device could be sold for $15,000. If the development spending cannot be recovered, the firm should

The 40,000 is sunk. From the current decision point, spending 12,000 to obtain 15,000 adds 3,000.
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E. complete it because the remaining benefit exceeds the remaining cost

The 40,000 is sunk. From the current decision point, spending 12,000 to obtain 15,000 adds 3,000.

Quiz complete