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    Eco 162 - Quiz 1 FEB 2014

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    Luqman Latif
    The document contains a quiz with multiple choice and calculation questions about microeconomic concepts such as demand, supply, elasticity, production possibilities curve, and opportunity cost. It asks students to calculate price and income elasticity, draw demand curves, interpret production possibility frontiers, and identify assumptions of PPCs.

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    Eco 162 - Quiz 1 FEB 2014

    Uploaded by

    Luqman Latif
    334 views3 pages
    The document contains a quiz with multiple choice and calculation questions about microeconomic concepts such as demand, supply, elasticity, production possibilities curve, and opportunity cost. It asks students to calculate price and income elasticity, draw demand curves, interpret production possibility frontiers, and identify assumptions of PPCs.

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    Eco 162 -Quiz 1 FEB 2014

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    The document contains a quiz with multiple choice and calculation questions about microeconomic concepts such as demand, supply, elasticity, production possibilities curve, and opportunity cost. It asks students to calculate price and income elasticity, draw demand curves, interpret production possibility frontiers, and identify assumptions of PPCs.

    Copyright:

    © All Rights Reserved
    Download as DOC, PDF, TXT or read online from Scribd
    Download as doc, pdf, or txt
    334 views3 pages

    Eco 162 - Quiz 1 FEB 2014

    Uploaded by

    Luqman Latif
    The document contains a quiz with multiple choice and calculation questions about microeconomic concepts such as demand, supply, elasticity, production possibilities curve, and opportunity cost. It asks students to calculate price and income elasticity, draw demand curves, interpret production possibility frontiers, and identify assumptions of PPCs.

    Copyright:

    © All Rights Reserved
    Download as DOC, PDF, TXT or read online from Scribd
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    UiTM (KEDAH) / ALDi

    ECO 162 - MICROECONOMICS


    QUIZ 1
    Answer ALL Qes!i"ns
    SECTION A
    Tre (T) "r #$%se (#) &
    I' #$%se (#) ( w)* !)e s!$!e+en! is '$%se ,
    1.. A%-i , an economist by training and a young coconut $--i.! , says that he would buy one
    young coconut a day regardless of the price . If he is telling the truth , Aldis demand
    for young coconut is perfectly elastic .
    2 If Obama , an American basketball player decides to stay in university for his final
    year rather than sign an !A contract , the opportunity cost to him of his final year of
    university could be well over "# $ % million
    % . &conomics is an art ..
    '. (alaysia is a capitalist economy .
    ). *he +atin phrases ceteris paribus means , prices being e-ual , .
    .. *he price of a good and the -uantity demanded are inversely related .
    /. (icroeconomics focuses on issues such as economic growth , inflation 0 unemployment
    1. #upply curves are usually downward2sloping .
    3. *o measure how much demand responds to changes in its determinants , economists use
    the concept of revenue .
    14. 5emand curve tend to be more elastic in the short run .
    SECTION /
    1.
    6rice of 7ood A 89(: ;uantity 5emanded for 7ood A 8<g: ;uantity 5emanded for ! 8 <g:
    2 1. 14
    ' 1' 12
    . 12 1'
    1 14 1.
    a: =alculate the price elasticity of demand for good A if the price of good A increases
    from 9( 2 to 9( . per <g. . Is the demand price elastic > ?hy >
    b: =alculate the cross elasticity of demand of good ! when the price of A falls from 9(
    . to 9( 2 . #tate whether good A and good ! are complements or substitutes .
    c: #ketch a diagram to show what will happen to demand for good ! when the price of
    good A decreases 8 based on -uestion 28b: above :
    d: ?hen <u +ees allowance increases from 9( 1444 to 9( 2444 , his demand for
    good @ falls from 24 to 14 units . =alculate the income elasticity of demand for
    good @ and identify the type of good @ .
    e: +ist two 82: factors influencing the price elasticity of demand .
    2 *he following table shows the maAimum possible combination of good @ and good
    B in a country .
    =ombinati
    ons
    7ood B 7ood @ Opp. =ost 8 O= : O= 6er "nit of @
    A 1)4 4
    ! 1%4 144
    = 144 244
    5 .4 %44
    & 4 '44
    a: #ketch the 6roduction 6ossibilities =urve 8 66=: for this economy
    b: ?hat will happen if the country decides to produce the following combinations C
    8i: 144 units of good @ and .4 units of good B
    8ii: %)4 units of good @ and 124 units of good B
    c: =alculate the opportunity cost 8O=: and the O= per unit of good @ when moving
    down from point A to ! , = , 5 , and & .
    d: 5oes these combinations 8 66=: demonstrate increasing opportunity cost > ?hy >
    e: A straight line 66= shows a DDDDDDDDDDDDDDDDDDD opportunity cost .
    f: ?hat are the two 8 2 : assumptions for a given 66= >

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