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

2. What are examples of equity modes of entry? (Choose THREE.)

A) Franchising
B) Acquisitions
C) Strategic alliances
D) Greenfield investments
E) Licensing

3. What are weaknesses of the theory of mercantilism? (Choose TWO.)

A) The theory promotes free trade.
B) Application of the theory reduces national wealth in the long run.
C) The theory emphasizes comparative advantage.
D) The theory encourages specialization and productivity growth.
E) The theory leads to inefficient allocation of resources.

4. What is one benefit of small-scale entries into foreign markets?

A) They give complete equity and operational control.
B) They demonstrate a strategic commitment to certain markets.
C) They focus on learning by doing while limiting the downside risk.
D) They present easy opportunities to build market share.

5. What are features shared by monopolies and perfect competition? (Choose TWO.)

A) Price is greater than marginal cost.
B) The structure does not produce the welfare-maximizing level of output.
C) In the long run, new firms can easily enter the market.
D) Firms earn economic profits in the short run.
E) Maximum profit occurs when marginal revenue equals marginal cost.
F) In the long run, it is nearly impossible for new firms to enter.

Solutions: