1.) The demand curve for Good X describes the amount of Good X that:
A. buyers can but are not willing to purchase at different prices
B. buyers are both willing and able to purchase at one particular price
C. will be supplied at different prices
D. buyers are both willing and able to purchase at different prices
[1½]
2. Which one of the following accurately describes the opportunity cost of producing
Good X?
A. The cost of producing Good X in money terms.
B. The foregone output from the next best alternative use to which factors of
production used to produce Good X could be put.
C. The stream of services provided by Good X over its entire lifetime.
D. The production of Good X foregone in the previous year to enable Good X to
be produced this year.
[1½]
3.) The law of diminishing marginal utility applied to consumption of Good X implies
that the:
A . more one consumes of Good X, the less utility one derives from the first unit
of consumption of Good X
B. total utility derived from the consumption of Good X increases by smaller
amounts for each extra unit of Good X consumed
C. marginal utility derived from the consumption of an extra unit of Good X falls
, (business finance)2
if the price of Good X falls
D. marginal utility derived from the consumption of an extra unit of Good X falls
if the price of Good X rises
[1½]
4.) The price of Good X will not change following an increase in the demand for Good X
if the price elasticity of:
A. supply is zero
B. supply is infinite
C. demand is zero
D. demand is 1
[1½]
5.) Which one of the following will NOT shift the demand curve for a normal good to the
left?
A . A fall in consumers incomes.
B. A rise in the price of a complementary good.
C. A fall in the price of a substitute good.
D. A rise in the price of the normal good.
[1½]
6.) Which ONE of the following statements is NOT applicable to a Giffen good?
A. The demand curve has a positive slope.
B. The income effect on demand of a price change will affect demand in the
opposite direction to the substitution effect.
C. The substitution effect of a fall in price of the good will lead to a fall in
demand.
D. Demand falls if income increases, other things being equal.
[1½]
7.) A profit maximising monopolist that price discriminates is able to:
A. achieve a greater average revenue than if it charged a single price
B. achieve lower total production costs per unit of output
C. increase its profits and simultaneously lower its profit maximising output
D. increase its profits by reducing its production costs more than its total revenue
The benefits of buying summaries with Stuvia:
Guaranteed quality through customer reviews
Stuvia customers have reviewed more than 700,000 summaries. This how you know that you are buying the best documents.
Quick and easy check-out
You can quickly pay through credit card for the summaries. There is no membership needed.
Focus on what matters
Your fellow students write the study notes themselves, which is why the documents are always reliable and up-to-date. This ensures you quickly get to the core!
Frequently asked questions
What do I get when I buy this document?
You get a PDF, available immediately after your purchase. The purchased document is accessible anytime, anywhere and indefinitely through your profile.
Satisfaction guarantee: how does it work?
Our satisfaction guarantee ensures that you always find a study document that suits you well. You fill out a form, and our customer service team takes care of the rest.
Who am I buying these notes from?
Stuvia is a marketplace, so you are not buying this document from us, but from seller Acontent. Stuvia facilitates payment to the seller.
Will I be stuck with a subscription?
No, you only buy these notes for £12.99. You're not tied to anything after your purchase.
