Economics quiz part 1

Total Questions : 25

Scoring System:
Correct Answer    : +1 points
Incorrect Answer  : -1 point
Not Answered      :  0 point


The final result will appear at the end. All The Best.
  

1. The Opportunity Cost Of Something Is
What you have to give up by not putting the resources necessary to acquire it to their next best alternative use
The price you paid for it
Any cost that cannot be recovered
2. Which Of The Following Best Describes A Technology With Increasing Returns To Scale?
Q(2L, 2K) = 4Q(L, K)
Q(2L, K) = Q(L, 2K)
Q(2L, 2K) = Q(L, K)
3. In Which Of The Following Circumstances A Natural Monopoly Would Likely Arise?
Unit production costs are very high at relatively low output levels
Entrance of a second firm to the industry would result in losses for the entrant
Both
4. The Market Demand Curve Is
Derived by horizontally summing the individual demand curves at each price.
Derived by vertically summing the individual demand curves at each price.
Derived by horizontally summing the individual demand curves at each quantity.
5. Which Of The Following Is True For A Long-Run Equilibrium In A Competitive Industry?
min(ATC) = P
min(MC) = P
min(AVC) = P
6. For A Demand Curve To Slope Upward,
The good must be an inferior good with an income effect that dominates the substitution effect
Consumers are irrational
The good must be a normal good with a substitution effect that dominates the income effect
7. Which Of The Following Combinations Is More Likely To Have Straight-Line Indifference Curve?
Lukoil gasoline and Rosneft gasoline
Pizza and beer
Gasoline and automobiles
8. Which Of The Following Is A Necessary Condition For A Monopoly To Arise?
None
Superior technology or scale economies
Production-specific patents
9. A Monopolist's Marginal Revenue Curve Lies Below Average Revenue, Because:
A monopolist has to decrease price of all goods sold if it wants to expand output
Marginal magnitudes consider smaller increments than average ones
Price elasticity of demand decreases as quantity rises
10. The Market Demand Curve For A Luxury Good:
Is downward sloping
Is upward sloping
Has price elasticity greater than unity
11. Along A Country’s Production Possibilities Curve
There are no idle resources
The costs of production of the goods that are produced are identical
Resources are equally well equipped for the production of any good
12. Which Of The Following Is True For A Long-Run Equilibrium In A Competitive Industry?
min(ATC) = P
min(MC) = P
min(AVC) = P
13. Which Of The Following Is An Example Of A Normative Economic Statement?
The Russian budget deficit has reached alarming levels due to crisis.
10% of the population in Russia lives below poverty level.
Moscow had a budget surplus in 2007.
14. By The Term “Demand Curve” Economists Mean The Curve Describing The Relationship Between Price And Quantity Demanded. The Focus On Price Means That
Economists are assuming that other influences on quantity demanded are constant so that the effect of price can be isolated.
The model's predictive power is of little value.
Economists believe price is the only factor that influences quantity demanded.
15. A Firm Increases The Number Of Hours Its Workers Are Employed From 7,000 To 8,000, And Output Increases From 140,000 Bushels To 155,000 Bushels. The Marginal Product Of An Extra Hour Is
15
10
20
16. Which Of The Following Is NOT A Defining Feature Of Perfect Competition?
Perfect information
No barriers to entry
Heterogeneous product
17. An Individual Competitive Firm's Short-Run Supply Function Is (Over The Relevant Range Of Prices):
Its MC schedule
Its AVC schedule
Its AFC schedule
18. Which Of The Following Best Describes A Technology With Increasing Returns To Scale?
Q(2L, K) = Q(L, 2K)
Q(2L, 2K) = Q(L, K)
Q(2L, 2K) = 4Q(L, K)
19. Which Of The Following Will NOT Entail An Outward Shift Of The Production Possibilities Curve?
An upgrading of the quality of a nation's human resources
The reduction of unemployment
An increase in the quantity of a society's labour force
20. Which Of The Following Is A Necessary Condition For A Monopoly To Arise?
Superior technology or scale economies
Production-specific patents
None
21. A Typical Shop In Bavaria Would Offer About A Hundred Brands Of Local Beer. The Local Beer Industry In Bavaria Would Likely Constitute:
An oligopoly
A monopolistic competition
A natural monopoly
22. Vasya Is An Accountant. He Receives $200 Per Hour Doing Tax Returns. He Can Type 12,000 Characters Per Hour Into Spreadsheets. He Can Hire An Assistant Who Types 3,000 Characters Per Hour Into Spreadsheets. Which Of The Following Statements Is True?
Vasya should hire the assistant as long as he pays the assistant less than $50 per hour.
Vasya should hire the assistant as long as he pays the assistant less than $100 per hour.
Vasya should hire the assistant as long as he pays the assistant less than $200 per hour.
23. Creation Of A Trade Union Will Typically Lead To:
A loss of jobs by insiders
An increase in labour market efficiency
A rise in economic rent of insiders
24. Consider A Small Town Build Around A Coal Mine Which Is Perfectly Competitive In Its Product Market And Is The Sole Employer In The Town. Suppose That Employment Is Controlled By A Trade Union Seeking To Maximize The Total Wage Bill Of Its Members. Then Wages Will Be Determined By:
MRPL = MCL
MVPL = MCL
None
25. Cournot Oligopoly Is Characterized By:
Easy adjustment of prices, thus strategic choice of output
Easy adjustment of output, thus strategic choice of prices
Sequential decision-making