On the production frontier curve in the graph, what would the output be at point C?

About 34 whiteboards and 39 computers

The law of demand states that:

the lower the price, the higher demand for the good/service

In short, what is SCARCITY?

Resources are finite, human needs and wants are infinite

If demand for Herald Sun is up 10% as a result of the price of The Age increase by 15%..

Cross-price elasticity of demand is high

If a cost of producing cricket bats increases, it means:

A higher market price, and a smaller quantity demanded

What two conditions must be met in order for the economy to produce maximum possible output?

All resources fully employed and productive efficiency

What happens when the price of a good changes, ceteris paribus?

A movement along the demand curve

With negative externalities present, which describes equlibrium price and quantity of output?

The price is too low and the output is too high

Given the scarcity, what are the three basic questions that every economy must answer?

What to produce, how and for whom to produce

If the government introduced rent controls to increase the affordability, the rental market....

...would experience a shortage of rental accomodation

If butter and margarine are substitute goods, and the price of butter falls, then.....

The demand curve for margarine will shift to the left

What is market failure?

The failure of the market to allocate resources efficiently

A downward movement along the supply curve for cigarettes is most likely to be cused by:

A media/health campaign about the negative effect of smoking

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IB Economics-Microeconomics Quiz

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Questions 24

Answers

1
On the production frontier curve in the graph, what would the output be at point C?
51 computers and 3 whiteboard
About 34 whiteboards and 39 computers
49 whiteboards and 1 computer
34 computers and 39 whiteboards
2
The law of demand states that:
the higher the price, the higher demand for the good/service
the lower the price, the higher demand for the good/service
the lower the price, the lower demand of the good/service
All of the above
3
In short, what is SCARCITY?
Resources are finite, human needs and wants are infinite
Underallocation of resources
Overallocation of resources
Human needs and wants are finite, resources are infinite
4
'The value of the next best alternative forgone to obtain something else', is...
Productive efficiency
Sustainability
Scarcity
Opportunity cost
5
If demand for Herald Sun is up 10% as a result of the price of The Age increase by 15%..
Cross-price elasticity of demand is high
Income elasticity of demand is high
Cross-price elasticity of demand is low
Price elasticity of supply is high
6
'The study concerned with the best possible use of scarce resources and unlimited wants'..is...
Scarcity
Opportunity cost
Economics
The factors of production
7
What is the reason for the demand curve being downward sloping?
Decreasing marginal benefits
Increasing marginal benefits
A lack of demand and supply for the good/service
Willingness to buy goods/services
8
If a cost of producing cricket bats increases, it means:
A higher market price, and a smaller quantity demanded
A lower market price and a smaller quantity supplied
A higher market price and a higher quantity demanded
A lower market price and a higher quantity supplied
9
Which of the following would be most likely to cause the supply curve to shift to the left?
An increase in staff wages
An increase in tax
An obsolete (primitive) technology
All of the above
10
What two conditions must be met in order for the economy to produce maximum possible output?
Achieving actual output of an economy
All resources fully employed and productive efficiency
None of the above
Some key resources employed and productive efficiency
11
'A positive causal relationship between the quantity of a good supplied and its price.'
The law of supply
The law of demand
None of the above
Price elasticity of suppy
12
What happens when the price of a good changes, ceteris paribus?
A reduction in demand of the good
A shift in the demand curve
None of the above
A movement along the demand curve
13
With negative externalities present, which describes equlibrium price and quantity of output?
Both price and output are too high
The price is too low and the output is too high
Both price and output are too low
The price is too high and the output is too low
14
Which of the following values reflects unit elastic supply?
0 < PES > 1
PES < 0
PES = 0
PES = 1
15
Given the scarcity, what are the three basic questions that every economy must answer?
What to produce, how and for whom to produce
What to produce, where to produce and how much to produce
What not to produce, where and when to produce
What is the population of a country, how and when to produce
16
'Ceteris paribus' is a Latin expression which means:
All else being equal
Unequal distribution of income
All else being unequal
Equal distribution of resources
17
If the government introduced rent controls to increase the affordability, the rental market....
...would experience a shortage of rental accomodation
...would see a contraction in demand for rental accomodation
..an increase in the construction in new rental dwellings
.would see an expansion in the supply of rental accomodation
18
If butter and margarine are substitute goods, and the price of butter falls, then.....
There wil be no change in the demand for margarine
The demand curve for margarine will shift to the left
The demand curve for butter will shift to the left
The demand curve for margarine will shift to the right
19
A measure of the responsiveness of the quantity of a good demanded to changes in its price' is:
Cross-price elasticity of supply
Cross-price elasticity of demand
Price elasticity of supply
Price elasticity of demand
20
If YED (Income Elasticity of Demand) is greater than 1, it is elastic, and goods are:
Luxuries
Inferior
Normal
Necessities
21
What is market failure?
None of the above
The failure of the market to allocate resources efficiently
A market where externalities do not exist
Allocative efficiency
22
Which of the following is NOT the non-price determinant of market demand?
Preferences and tastes
Producer (firm) expectations
Prices of complimentary goods
Prices of substitute goods
23
A downward movement along the supply curve for cigarettes is most likely to be cused by:
None of the above
Drought conditionbs in the tobacco growing region
An increase in the price of cigarettes
A media/health campaign about the negative effect of smoking
24
What is the most likely cause of the leftward shift in the demand curve, ceteris paribus?
A decrease in consumer income
All of the above
A change in tastes against the product
A decrease in the number of buyers

IB Economics-Microeconomics Quiz Flashcards | StudBud