Practice Quiz For Economics Honors Students
I created this quiz to practice for my economics honors final. Pretty lame i know.
- 1.A market:
- A.
Entails the exchange of goods, but not services.
- B.
Is an institution that brings together buyers and sellers.
- C.
Reflects upsloping demand and downsloping supply curves.
- D.
Always requires face-to-face contact between buyer and seller.
- 2.Graphically, the market demand curve is:
- A.
Greater than the sum of the individual demand curves.
- B.
Steeper than any individual demand curve that is part of it.
- C.
The horizontal sum of individual demand curves.
- D.
The vertical sum of individual demand curves.
- 3.The demand curve shows the relationship between:
- A.
Money income and quantity demanded.
- B.
Price and production costs.
- C.
Price and quantity demanded.
- D.
Consumer tastes and the quantity demanded.
- 4.
A decrease in demand is depicted by a:- A.
Move from point x to point y.
- B.
Shift from D1 to D2
- C.
Shift from D2 to D1
- D.
Move from point y to point x
- 5.
A decrease in quantity demanded (as distinct from a decrease in demand) is depicted by a:
- A.
Move from point x to point y.
- B.
Shift from D1 to D2.
- C.
Shift from D2 to D1.
- D.
Move from point y to point x.
- 6.A recent study found that an increase in the Federal tax on beer (and thus an increase in the price of beer) would reduce the demand for marijuana. We can conclude that:
- A.
Beer & marijuana are substitute goods.
- B.
Beer & marijuana are complimentary goods.
- C.
Beer is an inferior good.
- D.
Marijuana is an inferior good.
- 7.Which of the following will not cause the demand for the product K to change?
- A.
A change in the price of close-substitute product J
- B.
An increase in consumer income
- C.
A change in the price of K
- D.
A change in consumer tastes
- 8.Which of the following would not shift the demand curve for beef?
- A.
A widely publicized study that indicates beef increases one's cholesterol
- B.
A reduction in the price of cattle feed
- C.
An effective advertising campaign by pork producers
- D.
A change in the incomes of beef consumers
- 9.In 2003 the price of oil increased, which in turn caused the demand of natural gas to rise. This can best be explained by saying that oil and natural gas are:
- A.
Complementary goods and the higher price for oil increased the demand for natural gas.
- B.
Substitute goods and the higher price for oil increased the demand for natural gas.
- C.
Complementary goods and the higher price for oil increased the demand for natural gas.
- D.
Substitute goods and the higher price for oil decreased the supply of natural gas.
- 10.An economist for a bicycle company predicts that, other things equal, a rise in consumer incomes will increase the demand for bicycles. This prediction is based on the assumption that:
- A.
There are many goods that are substitutes for bicycles.
- B.
There are many goods that are complimentary to bicycles.
- C.
There are few goods that are substitutes for bicycles.
- D.
Bicycles are normal goods.
- 11.A rightward shift in the demand curve for product C might be caused by:
- A.
An increase in income if C is an inferior good.
- B.
A decrease in income if C is a normal good.
- C.
A decrease in the price of a product that is a close substitute for C.
- D.
A decrease in the price of a product that is complimentary to C.
- 12.If the two goods are complements:
- A.
They are consumed independently.
- B.
An increase in the price of one will increase the demand for the other.
- C.
A decrease in the price of one will increase the demand for the other.
- D.
They are necessarily inferior goods.
- 13.DVD players and DVDs are:
- A.
Complimentary goods.
- B.
Substitute goods.
- C.
Independent goods.
- D.
Inferior goods.
- 14.If the demand curve for product B shifts to the right as the price of product A declines, then:
- A.
Both A and B are inferior goods.
- B.
A is a superior good and B is an inferior good.
- C.
A is an inferior good and B is a superior good.
- D.
A and B are complementary goods.
- 15.If the price of product L increases, the demand curve for close-substitute product J will:
- A.
Shift downward toward the horizontal axis.
- B.
Shift to the left.
- C.
Shift to the right.
- D.
Remain unchanged.
- 16.Which of the following is most likely to be an inferior good?
- A.
Fur coats
- B.
Ocean cruises
- C.
Used clothing
- D.
Steak
- 17.Cameras and film are:
- A.
Substitute goods.
- B.
Complementary goods.
- C.
Independent goods.
- D.
Inferior goods.
- 18.A decrease in the price of cameras will:
- A.
Cause the demand curve for film to become vertical.
- B.
Shift the demand curve for film to the right.
- C.
Shift the demand curve for film to the left.
- D.
Not affect the demand for film.
- 19.A normal good is one:
- A.
Whose amount demanded will increase if its price decreases.
- B.
Whose amount demanded will increase if its price increases.
- C.
Whose demand curve will shirt leftward as incomes rise.
- D.
The consumption of which varies directly with incomes.
- 20.Assume the demand curve for product X shifts to the right. This might be caused by:
- A.
A decline in income if X is an inferior good.
- B.
A decline in the price of Z if X and Z are substitute goods.
- C.
A change in consumer tastes that is unfavorable to X.
- D.
An increase in the price of Y if X and Y are complimentary goods.
- 21.A PPC might be shifted outward by each of the following EXCEPT:
- A.
Increase in immigration
- B.
Advancements made in Information Management Systems
- C.
Decrease in unemployment
- D.
Increase in educational levels of the general population
- 22.A production possibility frontier that is represented by a straight line rather than the usual bowed shape would indicate:
- A.
Increasing opportunity cost
- B.
Decreasing opportunity cost
- C.
Constant opportunity cost
- D.
Absolute and comparative advantage
- E.
Comparative but not absolute advantage
- 23.What is the fundamental problem of economics?
- A.
Scarcity
- B.
Capital
- C.
The factors of production
- D.
Labor
- 24.Suppose you are eating a steak at a restaurant. What is the opportunity cost to you of the steak meal?
- A.
The price of the steak, drinks & tip.
- B.
The cost of dressing up and transportation to the restaurant
- C.
The lost opportunity to have chicken instead.
- D.
All the above are opportunity costs of the steak dinner
- E.
None of the above is an opportunity cost of the steak dinner
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