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2. micro econ mock exam.pdf

8 Pages

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ECON 1000
Nick Rowe

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PASS MOCK EXAM SECTIONS A/V PASS MOCK EXAM – FOR PRACTICE ONLY Course: ECON 1000 A/V Facilitator: Jay Carter Dates and locations of mock exam take-up: 4:00-5:30 Tuesday October 16 SP 412 4:00-5:30 Wednesday October 17 ML 402 IMPORTANT: It is most beneficial to you to write this mock exam UNDER EXAM CONDITIONS. This means: • Complete the exam in _1.5_ hour(s). • Work on your own. • Keep your notes and textbook closed. • Attempt every question. After the time limit, go back over your work with a different colour or on a separate piece of paper and try to do the questions you are unsure of. Record your ideas in the margins to remind yourself of what you were thinking when you take it up at PASS. The purpose of this mock exam is to give you practice answering questions in a timed setting and to help you to gauge which aspects of the course content you know well and which are in need of further development and review. Use this mock exam as a learning tool in preparing for the actual exam. Please note:  Come to the PASS mock exam with a completed copy of the exam. We will spend 1.5 hours on take- up and review.  Often, there is not enough time to review the entire exam in the PASS session. Decide which questions you most want to review – the facilitator may ask students to vote on which questions they want to discuss.  Facilitators do not bring copies of the mock exam to the session. Please print out and complete the exam before you attend.  Facilitators do not produce or distribute an answer key for mock exams. Facilitators help students to work together to compare and assess the answers they have. If you are not able to attend the PASS session, you can work alone or with others in the class. GOOD LUCK! PASS MOCK EXAM SECTIONS A/V Multiple Choice Questions - 40 total (2 marks each) 1. After calculating the elasticity of a demand curve as 0.68, you deem that this curve is: a) Perfectly Elastic b) Perfectly Inelastic c) Elastic d) Inelastic 2. The four variables that will cause a supply curve to shift are: a) Technology, Input Prices, Expectations and Government Interference b) Input Prices, Output Prices, Market Changes and Government Interference c) Input Prices, Technology, Expectations and Number of Sellers 3. Suppose that a tax is placed on DVDs. If the seller ends up paying the majority of the tax, we know the a) demand curve is more inelastic than the supply curve b) supply curve is more inelastic than the demand curve c) government has placed the tax on the seller d) government has placed the tax on the buyer 4. If muffins and coffee are complements in consumption, then should the price of muffins increase: a) there would be an increase in the quantity of coffee demanded b) there would be an increase in the demand for coffee c) there would be a decrease in the quantity of coffee demanded d) there would be a decrease in the demand of coffee 5. There are several close substitutes for Greco Pizza but fewer substitutes for Pizza in general. Therefore, you would expect the relative demand for: a) both to be equally elastic b) both to be equally inelastic c) pizza to be more elastic d) pizza to be more inelastic e) Greco Pizza to be more inelastic 6. When a consumer's income increases and they then proceed to buy less of a good, this good can be termed as: a) inferior b) substitute c) regular d) normal 7. Suppose that that the number of buyers in a market increases and there is a technological advancement. What would we expect to happen in the market? a) The equilibrium price would increase, but the impact on the amount sold in the market would be ambiguous b) The equilibrium price would decrease, but the impact on the amount sold in the market would be ambiguous c) Both equilibrium price and equilibrium quantity would increase d) Equilibrium quantity would increase, but the impact on equilibrium price would be ambiguous 8. A Binding Price Ceiling is set: a) below the supply curve b) above the demand curve c) below the equilibrium point d) equal to the equilibrium point PASS MOCK EXAM SECTIONS A/V 9. If your local swimming pool decreases membership fees and demand for the pool is relatively elastic, you would expect: a) a decrease in total revenue received by the pool b) a decrease in the amount of memberships purchased c) a increase in the memberships purchased d) an increase in total revenue received by the pool e) both c and d Use the following table to answer next two problems: Hours needed to make 1 unit Computers Boats Sweden 10 8 Zambia 24 12 10. The opportunity cost of 1 Computer for Zambia is: a) 0.5 boats b) 2 boats c) 24 labour hours d) 2.4 computers 11. Sweden has a comparative advantage in: a) Computers b) Boats c) Both d) Neither good 12. A market produces too little of a good when: a) it is efficient b) supply and demand are equal c) supply price is less than demand price d) demand price is less than supply price 13.The "invisible hand" directs economic activity through a) advertising. b. prices. c. central planning. d. government regulations. PASS MOCK EXAM SECTIONS A/V Figure 2-8 14. Refer to Figure 2-8.. What is the opportunity cost of moving from point A to point B? a) 8 bathtubs b) 20 barrels c) the difference between the 8 bathtubs you get and the 20 barrels you give up d) the difference between the 20 barrels you get and the 8 bathtubs you give up 15. Trade a) allows a person to consume at a point outside his or her production possibilities frontier. b) limits a person’s ability to produce goods and services on her own. c) must benefit both traders equally. d) is based on absolute advantage. 16. Which of the following would cause both the equilibrium price and equilibrium quantity of number two grade potatoes (an inferior good) to increase? a) an increase in consumer income b) a decrease in consumer income c) greater government restrictions on agricultural chemicals d) fewer government restrictions on agricultural chemicals 17. Efficiency means that a) Society is conserving resources in order to save them for the future. b) Society’s goods and services are distributed fairly among society’s members. c) Society is getting the most it can from its scarce resources. d) Society has lessened its dependence on energy sources. PASS MOCK EXAM SECTIONS A/V Figure 6-2 18. Refer to Figure 6-2. If the government imposes a binding price floor of $14.00 in this market, the result would be a a) excess supply of 20. b) excess supply of 40. c) excess demand of 20. d) excess demand of 40. 19. Refer to Figure 6-2. If price is $14, quantity demanded would be: a) 40 b) 50 c) 60 d) 70 20. If a market is allowed to move freely to its equilibrium price and quantity,
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