Scribd
Upload
412 views5 pages

Quiz 1

This document contains a 20 question multiple choice quiz on principles of microeconomics. The questions cover topics such as causes of shifts in demand and supply, opportunity cost, the law of demand, equilibrium price and quantity, and how price adjustments eliminate shortages and surpluses.

Uploaded by

aishabadar
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
412 views5 pages

Quiz 1

This document contains a 20 question multiple choice quiz on principles of microeconomics. The questions cover topics such as causes of shifts in demand and supply, opportunity cost, the law of demand, equilibrium price and quantity, and how price adjustments eliminate shortages and surpluses.

Uploaded by

aishabadar
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
You are on page 1/ 5

PRINCIPLES OF MICROECONOMICS

Quiz 1 Time: 30 minutes


Marks: 20

Attempt ALL questions. There is only ONE correct response to each question. All questions
carry equal marks.

1. The following are causes of shift in demand EXCEPT the one:


A. Change in income
B. Change in price
C. Change in fashion
D. Change in prices of substitutes

2. The opportunity cost of good A in terms of good B is equal to the


A. ratio of the price of good B to the price of good A.
B. ratio of the price of good A to the price of good B.
C. price of good A minus the price of good B.
D. price of good B minus the price of good A.

3. Wants, as opposed to demands,


A. depend on the price.
B. are the goods the consumer plans to acquire.
C. are the unlimited desires of the consumer
D. are the goods the consumer has acquired.

4. Scarcity guarantees that


A. wants will exceed demands.
B. demands will be equal to wants.
C. demands will exceed wants.
D. most demands will be satisfied.

5. The law of demand states that the quantity of a good demanded varies
A. inversely with its price.
B. directly with population.
C. directly with income.
D. inversely with the price of substitute goods.

6. Each point on the demand curve reflects


A. the highest price consumers are willing and able to pay for that particular unit of a
good.
B. the highest price sellers will accept for all units they are producing.
C. the lowest-cost technology available to produce a good.
D. all the wants of a given household.

1
7. The quantity supplied of a good or service is the quantity that a producer
A. actually sells at a particular price during a given time period.
B. should sell at a particular price during a given time period.
C. is willing to sell at a particular price during a given time period.
D. needs to sell at a particular price during a given time period.

8. Which of the following is NOT held constant while moving along a supply curve?
A. prices of resources used in production
B. expected future prices
C. the number of sellers
D. the price of the good itself

9. Which of the following correctly describes how price adjustments eliminate a


shortage?
A. As the price falls, the quantity demanded increases while the quantity supplied
decreases.
B. As the price rises, the quantity demanded decreases while the quantity supplied
increases.
C. As the price falls, the quantity demanded decreases while the quantity supplied
increases.
D. As the price rises, the quantity demanded increases while the quantity supplied
decreases.

10. The price of a good will fall if


A. the price of a complement falls.
B. there is a surplus at the current price.
C. the quantity demanded exceeds the quantity supplied.
D. the current price is less than the equilibrium price.

11. Which of the following definitely causes a fall in the equilibrium price?
A. a decrease in both demand and supply
B. an increase in demand combined with a decrease in supply
C. a decrease in demand combined with an increase in supply
D. an increase in both demand and supply

12. You observe that the price of a good rises and the quantity decreases. These
observations can be the result of
A. the supply curve shifting rightward.
B. the demand curve shifting rightward.
C. the demand curve shifting leftward.
D. the supply curve shifting leftward.

2
13. In the above figure, a change in quantity demanded with unchanged demand is
represented by a movement from
A. point a to point c.
B. point a to point e.
C. point a to point b.
D. None of the above represent a change in the quantity demanded with an
unchanged demand.

14. In the above figure, a change in quantity supplied with unchanged supply is
represented by a movement from
A. point b to point e.
B. point b to point a.
C. point e to point c.
D. point a to point e

15. In the above figure, if D2 is the demand curve, then a price of P3 would result in
A. a surplus of Q3 - Q1.
B. a shortage of Q4 - Q3.
C. a surplus of Q4 - Q0.
D. a shortage of Q3 - Q1.

16. In the above figure, if D2 is the original demand curve and the price of a substitute in
consumption rises, which price and quantity may result?
A. point c, with price P3 and quantity Q3
B. point d, with price P1 and quantity Q3
C. point a, with price P2 and quantity Q2
D. point b, with price P1 and quantity Q1

3
17. In the figure, the equilibrium price is initially $3 per bushel of wheat. If suppliers
come to expect that the price of a bushel of wheat will rise in the future, but buyers
do not, the current equilibrium price will
A. not change.
B. fall.
C. rise.
D. perhaps rise, fall, or stay the same, depending on whether there are more
demanders or suppliers in the market.

18. In the figure, the equilibrium price is initially $3 per bushel of wheat. If buyers come
to expect that the price of a bushel of wheat will rise in the future, but sellers do not,
the current equilibrium price will
A. rise.
B. fall.
C. not change.
D. perhaps rise, fall, or stay the same, depending on whether there are more
demanders or suppliers in the market.

19. Let Qd stand for the quantity demanded, Qs stand for the quantity supplied, and P
stand for price.
If Qd = 20 - 2P and Qs = 5 + 3P, then the equilibrium price is

A. $2.
B. $3.
C. $4.
D. $1.

4
20. Let Qd stand for the quantity demanded, Qs stand for the quantity supplied, and P
stand for price. If Qd = 20 - 2P and Qs = 5 + 3P, then the equilibrium quantity is
A. 14.
B. 5.
C. 20.
D. 3

Question Answer
1.
2.
3.
4.
5.
6.
7.
8.
9.
10.
11.
12.
13.
14.
15.
16.
17.
18.
19.
20.

You might also like