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WGU Global-Economics-for-Managers Exam Syllabus Topics:

Section	Weight	Objectives
Foreign Direct Investment and Global Strategy	20%	- Foreign Direct Investment (FDI) 1. Location advantages and entry modes 2. Theories of FDI, costs and benefits - Global Business Strategy 1. Strategic positions: Defender, Extender, Contender, Dodger 2. Porter's Diamond model
Foundations of Global Economics	20%	- Views on Globalization 1. New view, Evolutionary view, Pendulum view 2. Drivers and consequences of globalization - Economic Systems and Institutions 1. Market, command, and mixed economies 2. Political, legal, and cultural frameworks
Macroeconomics for Managers	10%	- Economic Indicators and Policies 1. Fiscal and monetary policy impacts 2. GDP, inflation, unemployment, business cycles
Global Finance and Monetary Systems	25%	- Balance of Payments and International Monetary System 1. Fixed vs floating exchange rates, IMF, World Bank 2. Current account, capital account, official reserves - Foreign Exchange Markets 1. Exchange rate determination, currency regimes 2. Hedging and risk management
International Trade Theory and Policy	25%	- Trade Policies and Barriers 1. Economic integration: EU, USMCA, ASEAN 2. Tariffs, quotas, subsidies, embargoes - Classical and Modern Trade Theories 1. Heckscher-Ohlin, Product life-cycle, Strategic trade theory 2. Absolute advantage, Comparative advantage

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WGU Global Economics for Managers (C211, UZC2) Sample Questions (Q117-Q122):

NEW QUESTION # 117
What is true about tariffs?

A. They lower domestic prices below world prices
B. They eliminate deadweight loss
C. They increase consumer surplus
D. They allow the government to raise revenue

Answer: D

Explanation:
InGlobal Economics for Managers, tariffs are recognized as a policy tool thatallows governments to raise revenue, making option C correct.
Tariffs generate revenue by taxing imported goods. While domestic producers may benefit and governments gain revenue, consumers lose due to higher prices and reduced choices. Tariffs also create deadweight loss, reducing overall economic efficiency.
Options A, B, and D contradict standard trade theory.
Therefore, option C is correct.

NEW QUESTION # 118
What is the Nash equilibrium?

A. A group of firms illegally acting in unison to improve profits or dominate a market
B. A situation in which economic actors interacting with one another each choose their best strategy from among all available strategies currently being used by said actors
C. A particular situation between two entities that illustrates why cooperation is difficult to maintain even when it is mutually beneficial
D. An agreement among firms in a market over production and price

Answer: B

Explanation:
A Nash equilibrium occurs when each participant in a strategic interaction chooses the best available strategy given the strategies chosen by others. Option C is correct because no actor has an incentive to change its strategy unilaterally once the equilibrium is reached. This concept is central to game theory and is especially useful in oligopoly analysis, where firms must consider how rivals will respond to pricing, output, advertising, or product decisions. Option A describes the prisoner's dilemma more specifically, which can produce a Nash equilibrium but is not the definition itself. Option B describes collusion or cartel behavior. Option D describes illegal coordinated action by firms. Managers use Nash equilibrium logic to anticipate competitor behavior and understand why mutually beneficial cooperation can be unstable.

NEW QUESTION # 119
Which statement about consumer surplus is true?

A. It measures total production efficiency
B. It is a good measure of economic well-being if policymakers want to satisfy buyers' preferences
C. It measures the well-being of sellers
D. It represents government revenue

Answer: B

Explanation:
InGlobal Economics for Managers,consumer surplusis a key measure ofbuyer welfare, making option B correct.
Consumer surplus equals the difference between what consumers are willing to pay and what they actually pay. Policymakers often use it to assess how market outcomes or policies affect consumers.
Options A and C describe producer surplus and tax revenue. Option D refers to total surplus, not consumer surplus alone.
Thus, option B is correct.

NEW QUESTION # 120
Barriers to entry in a market are the main cause of monopolies. Which statement is accurate when the barrier to entry has its source in government regulation?

A. A key resource required for production is owned by a single firm.
B. A single firm has the exclusive legal right to produce some good or service.
C. Economies of scale allow a firm to create output at a lower cost than other competitors.
D. A single firm can supply a good or service to an entire market at a lower cost than two or more firms could.

Answer: B

Explanation:
A monopoly created by government regulation exists when a single firm receives the exclusive legal right to produce or sell a good or service. Option B is correct because legal exclusivity prevents competitors from entering the market. This may occur through patents, copyrights, licenses, public franchises, or other government-granted rights. Option A describes a natural monopoly, where one firm can serve the entire market at lower cost due to cost structure. Option C describes a resource monopoly, where one firm controls a key input. Option D describes economies of scale, another source of natural monopoly power. Government- created monopoly power differs because entry is restricted by law rather than resource control or production efficiency. Managers must recognize this because legal rights can create strong market power.

NEW QUESTION # 121
What is the definition of marginal cost?

A. The increase in cost that arises from producing an additional unit of output
B. The total cost divided by total output
C. The fixed cost of production
D. The opportunity cost of capital

Answer: A

Explanation:
InGlobal Economics for Managers,marginal cost (MC)is defined asthe increase in total cost that arises from producing one additional unit of output, making option B correct. Marginal cost plays a central role in production and pricing decisions because it reflects the incremental cost of expanding output.
Marginal cost typically includes additional labor, materials, and variable inputs required for one more unit.
Fixed costs do not affect marginal cost in the short run because they do not change with output. As production increases, marginal cost may initially decline due to specialization and efficiency gains, but it often rises later because of diminishing marginal returns.
Managers rely on marginal cost to determine optimal output levels. Producing beyond the point where marginal cost exceeds marginal revenue reduces profit. Therefore, understanding marginal cost is essential for profit maximization, cost control, and operational planning.
Thus, option B correctly defines marginal cost.

NEW QUESTION # 122
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