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

1. When is it best for a firm to decrease production?

A) When marginal cost is greater than marginal revenue.
B) When the average variable cost is less than the price of a unit after a short-term stop.
C) When the price of a unit covers the average variable cost after a short-term stop.
D) When total revenue is greater than total cost.

2. Which characteristics are attributed to a democracy? (Choose THREE.)

A) It concentrates power in a single ruling party.
B) It prizes freedom of expression and organization.
C) It extends the right to organize economically to domestic and foreign firms.
D) It prohibits private ownership.
E) It contains political risk that is lower than in other political systems.

3. Which statement best summarizes the overall economic effect of tariffs?

A) They transfer surplus from consumers to producers and the government
B) They benefit consumers more than producers
C) They eliminate inefficiencies in global trade
D) They increase total economic surplus

4. When producing a piece of luggage, the marginal cost is $92 and the marginal revenue is $81. What is the best action for the firm?

A) Restart production
B) Enter the market
C) Increase production
D) Decrease production

5. Which transaction is included in the consumption component of GDP?

A) A person pays for a haircut
B) A government builds a highway
C) A company exports automobiles
D) A firm purchases new machinery

Solutions: