Microeconomics Core Concepts Exam
Exam info
- Subject
- Microeconomics
- Exam type
- University
- Questions
- 20
- Duration
- 60 min
- Answers
- ✓ With explanations
- School
- Đại học Mở TP.HCM (HCMCOU)
Questions (20)
- Q 1.
A country can produce either 100 units of food or 50 units of machinery, or some combination of both. A production combination located inside the PPF indicates that the economy is:
- A.
Using its resources efficiently
- B.
Experiencing resource underutilization or inefficiency
- C.
Producing beyond its current production capacity
- D.
Unable to produce more food without producing less machinery
- A.
- Q 2.
Which statement is positive rather than normative?
- A.
The government should reduce household energy consumption.
- B.
A minimum-wage policy is preferable to a tax on labor income.
- C.
Household energy consumption fell by 8 percent after the price increase.
- D.
Consumers should purchase more environmentally friendly products.
- A.
- Q 3.
The price of coffee rises while the price of tea, tastes, consumer income, and the number of buyers remain unchanged. What will happen to the demand for tea?
- A.
It will shift to the right because coffee and tea are substitutes.
- B.
It will shift to the left because coffee and tea are complements.
- C.
There will be a movement upward along the existing demand curve for tea.
- D.
It will remain unchanged because only the good's own price can affect its demand.
- A.
- Q 4.
A binding price ceiling is imposed on a market whose equilibrium price is . Which result must occur?
- A.
Quantity supplied equals quantity demanded at the ceiling price
- B.
Quantity demanded is greater than quantity supplied
- C.
Quantity supplied is greater than quantity demanded
- D.
The market automatically reaches a new long-run equilibrium at the ceiling
- A.
- Q 5.
Using the midpoint method, a product's price changes from to and quantity demanded changes from to . What is the absolute value of the price elasticity of demand?
- A.
- B.
- C.
- D.
- A.
- Q 6.
A household has income of and faces prices of and . Which bundle lies on its budget line?
- A.
- B.
- C.
- D.
- A.
- Q 7.
In a competitive market, sellers are less able to reduce their quantity supplied when price rises than buyers are to reduce quantity demanded. The tax burden will therefore:
- A.
Fall more heavily on sellers
- B.
Fall equally on buyers and sellers
- C.
Fall more heavily on buyers
- D.
Disappear entirely because tax incidence is set by legislation
- A.
- Q 8.
A firm's total product is units when it employs units of labor. Its average product of labor is:
- A.
units of output per unit of labor
- B.
units of output per unit of labor
- C.
units of output per unit of labor
- D.
units of output per unit of labor
- A.
- Q 9.
A business has total revenue of . Its explicit costs are , and its implicit costs are . What is its economic profit?
- A.
- B.
- C.
- D.
- A.
- Q 10.
In long-run equilibrium for a perfectly competitive industry with free entry and exit, which relationship must hold?
- A.
- B.
- C.
- D.
- A.
- Q 11.
A student chooses between paying tuition for a course or using the same money for a part-time job. Which statement best describes the opportunity cost of attending the course?
- A.
The tuition payment itself
- B.
The wages and other benefits forgone by working part-time
- C.
The total tuition paid over the student’s lifetime
- D.
The course materials required by the instructor
- A.
- Q 12.
The price of bus tickets rises, while the price of train tickets, consumer preferences, incomes, and the number of travelers remain unchanged. What is the most likely effect on demand for train tickets?
- A.
Demand for train tickets shifts to the right because consumers expect train prices to rise as well.
- B.
Demand for train tickets shifts to the left because buses and train travel are complementary goods.
- C.
Demand for train tickets shifts to the right because buses and train travel are substitutes.
- D.
Quantity demanded of train tickets decreases because consumers generally buy less of every service when travel becomes more expensive.
- A.
- Q 13.
In a competitive market, the market price is temporarily above the equilibrium price. Which sequence is most likely?
- A.
Quantity supplied exceeds quantity demanded, and sellers tend to reduce the price.
- B.
Quantity demanded exceeds quantity supplied, and sellers tend to raise the price.
- C.
Quantity supplied equals quantity demanded immediately, with no further price adjustment.
- D.
Consumers must purchase a fixed quota, and the market immediately returns to equilibrium.
- A.
- Q 14.
A product’s income elasticity of demand is negative. What does this indicate?
- A.
The product is a normal good.
- B.
The product is an inferior good.
- C.
The product is a substitute for another good.
- D.
The product has perfectly inelastic demand.
- A.
- Q 15.
A firm faces demand that is unit elastic over a particular price range. What happens to total revenue if the firm raises its price slightly within that range?
- A.
Total revenue decreases substantially.
- B.
Total revenue increases substantially.
- C.
Total revenue remains approximately unchanged.
- D.
Total revenue becomes zero.
- A.
- Q 16.
As a person consumes more units of a snack while holding preferences and other factors constant, marginal utility generally declines. This pattern is known as
- A.
Diminishing marginal utility
- B.
Increasing opportunity cost
- C.
Diminishing marginal returns
- D.
Price elasticity of supply
- A.
- Q 17.
A buyer is willing to pay $80 for a concert ticket but buys it for $60. What is the buyer’s consumer surplus?
- A.
$20
- B.
$60
- C.
$80
- D.
$140
- A.
- Q 18.
A producer receives a market price of $50 per unit and incurs a marginal cost of $42 for the last unit produced. What is the producer surplus on that unit?
- A.
$8
- B.
$42
- C.
$50
- D.
$92
- A.
- Q 19.
A firm can produce the same output using labor and capital. It chooses the cost-minimizing input combination where an isoquant is tangent to an isocost line. At that combination, which condition must hold?
- A.
- B.
- C.
- D.
- A.
- Q 20.
A competitive firm is considering whether to produce in the short run. It should shut down temporarily if
- A.
- B.
- C.
- D.
- A.
Answers and explanations are in mode.