KIIT University 2008 micro-economics - exam paper

1. The assumption that all other markets remain equal is called _________________.

2. Which statement best characterizes the economic problem?
a. We have limited wants, but unlimited resources with which to satisfy them.
b. We have unlimited wants, but limited resources with which to satisfy them.
c. We have unlimited wants and resources but we do not have enough money
d. There is no issue.
e. None of the above

3. A rise in the general price level is measured by ______________.

4. The Unemployment Rate is:
a. A fee paid to the government for not working
b. The percentage of people who are unemployed
c. The percentage of people involuntarily unemployed
d. The percentage of people voluntarily unemployed
e. None of the above

5. Which 1 of these statements is a normative statement?
a. An increase in the price of pencils will affect the sale of erasers.
b. Lowering taxes is better than getting a higher wage .
c. The inflation rate has increased in the last three months.
d. All the above
e. None of the above.

6. Points inside a production possibility curve are:
a. not being used to their full capacity
b. being used beyond their full capacity
c. being used at their full capacity.
d. useless because they don’t tell us anything.
e. None of the above

7. To compute modifications in Canada's total output is an example of _____________.
a. Microeconomics
b. Macroeconomics

8. To analyze the modifications in the price of watermelons is an example of __________.
a. Microeconomics
b. Macroeconomics



9. What is the opportunity cost of a product?
a. How much it costs to make a product.
b. How much money is needed to purchase a product.
c. The amount of utility you would have to sacrifice in order to gain 1 more unit of utility from a different product.
d. The utility that could have been gained from choosing the products best option.
e. c and d

10. The invisible hand theory of competition was proposed by the economist named _____________.

11. According the legal regulations of supply:
a. All resources are scarce and we must use them as efficiently as possible.
b. All producers have a supply curve with which they price their goods and services.
c. Supply will is always less then consumers’ demand.
d. No producer is allowed to produce more than anyone else.
e. Price and volume are positively related.

12. Which is an example of the legal regulations of demand?
a. As the price of pencils falls, volume of pencils purchased falls.

Earning:   Approval pending.