DEPARTMENT OF ECONOMICS
College of Business Administration
PAMANTASAN NG LUNGSOD NG MAYNILA
MANAGERIAL ECONOMICS Prof. Ricardo B. Deri
ST
Midterm Examination 1 Semester, SY 2022-2023
General Direction: Read each statement carefully. Choose the best answer from the choices provided
after each question. Write the answer being described in each sentence by shading the letter that
corresponds to the answer of your choice.
1. It is the condition that results from the imbalance between relatively unlimited wants and the
relatively limited resources available for satisfying those wants.
a. abundance d. scarcity
b. economics e. surplus
c. shortage
2. It is the study of how societies utilize its scarce resources to satisfy unlimited human wants and needs.
a. Sociology d. Science
b. Economics e. Demography
c. Management
3. These are people who combine labor, natural resources and capital to produce goods and services
and the one who face risks in their quest for profits.
a. entrepreneurs d. laborers
b. economists e. consumers
c. managers
4. It is defined as a schedule of different quantities of a resource, goods/services that consumers are
willing to buy at any given time at various possible prices.
a. Supply schedule d. Demand schedule
b. Goods e. services
c. curve
5. It is the amount of goods that the producers are willing to produce at various possible prices.
a. supply c. demand
b. goods e. services
c. price
6. It is considered to be both the reward and the motive of the business.
a. Profit c. Income
b. Sales d. bonus
7. Individual or organizational unit that either makes a purchase decision and/or consumes the goods.
a. households d. government
b. firm e. financial institution
c. market
8. Group of buyers and sellers interacting with each other.
a. inflow d. outflow
b. market e. economy
c. agreement
9. Law that claims “the qty the producers would like to produce increases when the price of good rises”.
a. law of demand c. law of supply
b. law of supply and demand d. law of goods and services
10. Law that claims “the quantity the consumers would like to buy increases when the price of good
decreases”.
a. law of demand c. law of supply
b. law of supply and demand d. law of goods and services
11. Excess demand for produced goods.
a. Shortage d. Breakeven
b. Surplus e. Savings
c. scarcity
12. Excess supply for produced goods.
a. Shortage d. breakeven
b. surplus e. savings
c. abundance
13. A group of firms producing and/or offering the same type of goods/services.
a. Financial institution c. gov’t owned & controlled corporations
b. industry d. market
14. What do you get when total number of goods sold is multiplied with its selling price equals
a. Total Revenue d. production cost
b. product cost e. profit
c. loss
15. Maximum amount that a product can be sold during shortage
a. Floor price c. ceiling price
b. selling price d. discounted price
16. Minimum amount that a product can be sold during surplus.
a. Floor price c. ceiling price
b. selling price d. discounted price
17. Pertains to personal likes or dislikes of consumers for certain goods and services.
a. Tastes/preferences c. changing incomes
b. seasonal product d. population change
18. Market Failure is a situation in which a market left on its own fails to allocate resources
efficiently.
a. market power c. market actor
b. market failure d. market equilibrium
19. It is the quantity of goods and services produced from each unit of labor input.
a. Productivity d. Incentive
b. Equality e. Efficiency
c. Effectivity
20. Market Equilibrium means
a. Qs=Qd c. Qs=Qd and Ps=Pd
b. Ps=Pd d. Qs > Qd
PART II PROBLEM SOLVING. Below are the hypothetical supply and demand functions for the
cellular phone manufacturing companies. Solve for the following values of Equilibrium Price.
Apple
21. QS= 110+12P
QD= 310-8P a. 10 b. 20 c. 30 d. none of the above
Nokia
22. QS= 480+32P
QD= 1680-8P a. 10 b. 20 c. 30 d. none of the above
Samsung
23. QS= 535+15P
QD= 1,135-45P a. 10 b. 20 c. 30 d. none of the above
Ericsson
24. QS= 40+5P
QD= 160-3P a. 5 b. 15 c. 25 d. none of the above
Motorola
25. QS= 1,110+112P
QD= 3,360-38P a. 5 b. 15 c. 25 d. none of the above
PART III. GRAPHICAL ANALYSIS OF SUPPLY AND DEMAND.
For numbers 26 to 35 kindly refer to the figure below
Price
A
C
Qty
26. C to D
A. increase in supply, increase in qty demanded C. decrease in supply, increase in qty demanded
B. increase in supply, decrease in qty demanded D. decrease in supply, decrease in qty demanded
27. B to C
A. increase in demand, increase in qty supplied C. decrease in demand, increase in qty supplied
B. increase in demand, decrease in qty supplied D. decrease in demand, decrease in qty supplied
28. D to A
A. increase in demand, increase in qty supplied C. decrease in demand, increase in qty supplied
B. increase in demand, decrease in qty supplied D. decrease in demand, decrease in qty supplied
29. B to A
A. increase in supply, increase in qty demanded C. decrease in supply, increase in qty demanded
B. increase in supply, decrease in qty demanded D. decrease in supply, decrease in qty demanded
30. A to D
A. increase in demand, increase in qty supplied C. decrease in demand, increase in qty supplied
B. increase in demand, decrease in qty supplied D. decrease in demand, decrease in qty supplied
31. D to B
A. increase in demand, increase in supply C. decrease demand, decrease in supply
B. increase in demand, decrease in supply D. decrease demand, increase in supply,
32. A to C
A. increase in demand, increase in supply C. decrease demand, decrease in supply
B. increase in demand, decrease in supply D. decrease demand, increase in supply,
33. C to B
A. increase in demand, increase in qty supplied C. decrease in demand, increase in qty supplied
B. increase in demand, decrease in qty supplied D. decrease in demand, decrease in qty supplied
34. B to D
A. increase in demand, increase in supply C. decrease demand, decrease in supply
B. increase in demand, decrease in supply D. decrease demand, increase in supply,
35. C to A
A. increase in demand, increase in supply C. decrease demand, decrease in supply
B. increase in demand, decrease in supply D. decrease demand, increase in supply,
VIII. Identification of a graph. For
numbers 36 to 45 kindly refer to
the figure below.
37
38 39 36
36-40
a. Equilibrium point
-------------------
b. surplus 40
c. price
d. floor price
e. supply
44 -----------------------
41-45
a. zero 41
b. shortage 42 43 45
c. quantity
d. ceiling price
e. demand
C. SOLVE FOR THE FF. VALUES OF THE PERCENTAGE CHANGE IN QUANTITY AND CHANGE IN PRICE
A B C D E F
Quantity 120 113 101 94 83 83
Price 60 60 69 77 89 96
46. A to B
a. a 5.83% increase in price will lead to 100% increase in quantity demanded
b. a 5.83% increase in price will lead to 100% decrease in quantity demanded
c. a 5.83% decrease in price will lead to 100% increase in quantity demanded
d. a5.83 % decrease in price will lead to 100% decrease in quantity demanded
e. even if there is no change in price an infinite change in the level of quantity demanded will happen
47. B to C
a. a 15% increase in price will lead to 10.6% increase in quantity demanded
b. a 15% increase in price will lead to 10.6% decrease in quantity demanded
c. a 15% decrease in price will lead to 10.6% increase in quantity demanded
d. a 15% decrease in price will lead to 10.6% decrease in quantity demanded
e. none of the above
48. C to D
a. an 11% increase in price will lead to 6.9% increase in quantity demanded
b. an 11% increase in price will lead to 6.9% decrease in quantity demanded
c. an 11% decrease in price will lead to 6.9% increase in quantity demanded
d. an 11% decrease in price will lead to 6.9% decrease in quantity demanded
e. none of the above
49. D to E
a. a 15.5% increase in price will lead to 11.7% increase in quantity demanded
b. a 15.5% increase in price will lead to 11.7% decrease in quantity demanded
c. a 15.5% decrease in price will lead to 11.7% increase in quantity demanded
d. a 15.5% decrease in price will lead to 11.7% decrease in quantity demanded
e. none of the above
50. E to F
a. a 7.8% increase in price will lead to 100% increase in quantity demanded
b. a 7.8% increase in price will lead to 100% decrease in quantity demanded
c. a 7.8% decrease in price will lead to 100% increase in quantity demanded
d. a 7.8% decrease in price will lead to 100% decrease in quantity demanded
e. any change in price does not affect the level of quantity demanded for the product
F. ANALYZING ELASTICITY OF DEMAND AND SUPPLY
51. It is a measure of the degree of responsiveness of quantity demanded of a product to a given change in one of
the variables which affect demand for that product.
a. Demand elasticity
b. supply elasticity
c. price elasticity
d. income elasticity
52. It is the responsiveness of consumer’s demand to change in price of goods sold.
a. Demand elasticity
b. supply elasticity
c. price elasticity of demand
d. income elasticity of demand
53. It is the responsiveness of consumer’s demand to change in their income.
a. Demand elasticity c. price elasticity of demand
b. supply elasticity d. income elasticity of demand
54. If consumers will pay almost any price for the product, then the demand for that product is said to be
a. elastic c. inelastic
b. unitary d. either a or c
55. Although prices may increase for these products, customers will not hesitate to engage in a transaction.
This is especially true with products like insulin which is literally a matter of life and death.
The only reason why production companies like this don't increase prices of insulin is because of fear of
government regulation. Products like Tobacco or Insulin are examples of
a. inelastic goods c. perfectly inelastic goods
b. elastic goods d. perfectly elastic goods
THAT IN ALL THINGS, GOD MAY BE GLORIFIED.
