Question

Sellers would offer _____ for sale as prices decreases and thus the supply curve is ____ sloping.

Select one:

a. less; upward

b. more; upwards

c. more; downwards

d. less; downwards

You should decide to go to a movie:

Select one:

a. If the marginal benefit of the movie exceeds its marginal cost..

b. If your income will allow you to buy a ticket

c. because movies are enjoyable

d. If the marginal cost of the movie exceeds its marginal benefit.

Factors of production can freely move in and out of the industry in a perfect competition market.

Select one:

True

False

The consumer price index increased from 124.0 in year 2015 to 130.7 in year 2016. The economy experienced:

Select one:

a. inflation of 6.7%

b. deflation of 6.7%

c. deflation of 5.4%

d. inflation of 5.4%

In the short run, a firm which produces 100 units of output has an average total cost of RM200 and average variable cost of RM150. The firm's total fixed cost is:

Select one:

a. RM0.50

b. RM5,000

c. RM500

d. RM50

If as a person's income increases, the quantity demanded of a good decreases, the good is called:

Select one:

a. A normal good

b. An inferior good

c. A substitute

d. A complementary good

A producer can change his product line in the short run.

Select one:

True

False

Monopoly is against public interest as its limits customer choices.

Select one:

True

False

Discounts given to senior citizens on railway tickets would be an example of third degree of price discrimination.

Select one:

True

False

Which of the following is a microeconomics statement?

Select one:

a. The price of personal computers declined last year

b. The general price level increased by 4% last year

c. The real domestic output increased by 2.5% last year

d. Unemployment was 6.8% of the labor force last year

The phase of a business cycle in which real output is at the minimum is a:

Select one:

a. Recovery

b. Peak

c. Expansion

d. Trough

Oligopoly firms with kinked demand curve continuously encourage price wars.

Select one:

True

False

The long-run average cost curve has a prolonged downward slope when a firm has early economies of scale.

Select one:

True

False

A price index reduces all the distinct prices for a class of goods to a single number.

Select one:

True

False

Seasonal unemployment occurs due to changes in the phases of business cycles.

Select one:

True

False

Answer 1

Ans) the correct option is a. less; upward. Supply curve is upward slopping meaning there is a positive relationship between price and the quantity supplied.

Ans) the correct option is a) If the marginal benefit of the movie exceeds its marginal cost. Marginal benefit of watching the movie should be greater than the marginal cost of watching the movie.

Ans) False. In perfect competition there is free entry of new firms but factors of production remain constant.

Ans) the correct option is d. inflation of 5.4%

inflation rate =( 130.7 - 124)/124 = 0.054 or 5.4%

Ans)the correct option is b. RM5,000

average fixed cost = average total cost - average variable cost

=RM200-RM150 = 50

Total fixed cost = average fixed cost *quantity

=50*100=RM5000

Ans) b. An inferior good. There is a negative relationship between income and the quantity demanded when the good is inferior.