Introduction to Microeconomics Test

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Introduction to Microeconomics Test - 4

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Weekly Quiz Competition

Question 1
1 / -0.25

An economy always produces on, but not inside a PPC.

A
True

B
False

C
Occasionally

D
Can ’t say

Solution

The statement is refuted because it is not essential that an economy always produces on PPC. It is bound to produce inside a PPC when its resources work inefficiently or resources are underemployed.
Question 2
1 / -0.25

The study of jute industry is a macroeconomic study. This statement is

A
False

B
True

C
Can ’t say

D
Conditional

Solution

Macroeconomic deals with the problem related to economy as a whole and this is the problem of one particular industry which comes under the study of microeconomics.
Question 3
1 / -0.25

Price determination of a commodity is a subject matter of microeconomics.

A
False

B
True

C
Can ’t say

D
Conditional

Solution

The market price of a commodity is determined (or reaches its competitive equilibrium) where the demand curve and the supply curve intersect —where the forces of demand and supply (also known as the impersonal market forces) are just in balance.
Microeconomics is a branch of economics that studies the behaviour of individuals and firms in making decisions regarding the allocation of scarce resources and the interactions among these individuals and firms. Price determination is related to individuals that is why it is a subject matter of microeconomics.
Question 4
1 / -0.25

The study of general price level is a macroeconomic study. This statement is

A
True

B
Can ’t say

C
False

D
Conditional

Solution

There are two sides to the study of economics: macroeconomics and microeconomics. As the term implies, macroeconomics looks at the overall, big-picture scenario of the economy. It focuses on the way the economy performs as a whole and then analyzes how different sectors of the economy relate to one another to understand how the aggregate functions.
Therefore, general price level is a part of macroeconomics.
Question 5
1 / -0.25

In which economy do consumers and producers make choices based on market forces of supply and demand?

A
Market economy

B
Open economy

C
Controlled economy

D
Command economy

Solution

Correct option is A. Market Economy
Question 6
1 / -0.25

Any allocation of resources result in

A
Consumption of goods

B
Inefficient utilization

C
Wastage of resources

D
Production of goods and services

Solution

Any product or service can be emerged only on the sacrifice made by the activity which drives the output factor. When an activity is sacrificed it amounts to consumption of resources.
Question 7
1 / -0.25

Under the Industrial policy of 1991:

A
The mandatory convertible clause is applicable to all term loans.

B
The mandatory convertible clause is applicable to term loans of more than 10 years.

C
The mandatory convertible clause is applicable to term loans of less than 10 years.

D
The mandatory convertible clause is no longer applicable.

Solution

A mandatory convertible is a security that automatically converts to common equity on or before a predetermined date. This hybrid security guarantees a certain return up to the conversion date, after which there is no guaranteed return but the possibility of a much higher return.
Question 8
1 / -0.25

The positive economic analysis deals with the variables

A
As they seem to be

B
As they are expected

C
As they should be

D
As they are

Solution

POSITIVE ECONOMICS is often called "WHAT IS "economics , it deals with the variables as they are.
Positive Economics uses WHAT IS and WHAT HAS BEEN OCCURRING in an economy as the basis for any statement about the future.
An EXAMPLE of a positive economic is, "increasing the INTEREST RATE will encourage people to save."
Another EXAMPLE of a positive economics is, "how government impacts INFLATION by printing more MONEY."
Question 9
1 / -0.25

If the demand for a good is inelastic, an increase in its price will cause the total expenditure of the consumers of the good to:

A
Increase

B
Decrease

C
Remain the same

D
Become zero

Solution

Since,the demand of the good is inelastic. So,even if the price will increase the consumer will not decrease the consumption of that good.They will continue to purchase that goods. Due to this the production will go on.And so,the expenditure will increase.
Question 10
1 / -0.25

The horizontal demand curve parallel to x-axis implies that the elasticity of demand is:

A
Zero

B
Infinite

C
Equal to one

D
Greater than zero but less than infinity

Solution

Infinite as demand can go on increasing even when the price is constant

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Re-Attempt Weekly Quiz Competition

Introduction to Microeconomics Test - 4

Result

Introduction to Microeconomics Test - 4

Score

-

Rank

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SHARING IS CARING

Question 1

True

False

Occasionally

Can ’t say

Solution

Question 2

False

True

Can ’t say

Conditional

Solution

Question 3

False

True

Can ’t say

Conditional

Solution

Question 4

True

Can ’t say

False

Conditional

Solution

Question 5

Market economy

Open economy

Controlled economy

Command economy

Solution

Question 6

Consumption of goods

Inefficient utilization

Wastage of resources

Production of goods and services

Solution

Question 7

The mandatory convertible clause is applicable to all term loans.

The mandatory convertible clause is applicable to term loans of more than 10 years.

The mandatory convertible clause is applicable to term loans of less than 10 years.

The mandatory convertible clause is no longer applicable.

Solution

Question 8

As they seem to be

As they are expected

As they should be

As they are

Solution

Question 9

Increase

Decrease

Remain the same

Become zero

Solution

Question 10

Zero

Infinite

Equal to one

Greater than zero but less than infinity

Solution

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