ECS1500 MOCK EXAM 1
QUESTIONS AND
ANSWERS 2022/2023
ANSWERS AT THE END OF THE PAPER
ECS1500 Mock Paper 1
2
Write the answers for each question on the answer sheet provided at the end.
1 A normal good is one for which the income elasticity is greater than one.
1 True
2 False
2 The demand f...
ECS1500 MOCK EXAM 1
QUESTIONS AND
ANSWERS 2022/2023
ANSWERS AT THE END OF THE PAPER
, ECS1500 Mock Paper 1
Write the answers for each question on the answer sheet provided at the end.
1 A normal good is one for which the income elasticity is greater than one.
1 True
2 False
2 The demand for a good, perceived by the consumer to be a necessity, will
tend to be elastic.
1 True
2 False
3 Macroeconomics is concerned with the study of how households and firms
make decisions and how they interact in specific markets
1 True
2 False
4 Price and quantity demanded for most goods are positively related
1 True
2 False
5 If three variables are related, one of them must be held constant when
plotting the other two in the xy-coordinate system
1 True
2 False
6 A 50% increase in price, which results in a 90% decrease in the quantity
demanded, indicates that demand is elastic in this p rice range
1 True
2 False
7 Absolute advantage is a comparison based on productivity
1 True
2 False
8 A decrease m the price of soft drinks will increase their demand (will shrift the
curve to the right).
1 True
2 False
2
, ECS1500 Mock Paper 1
9 If pizza and hamburgers are substitutes, a decrease in the price of pizza
would i n crease the demand for hamburgers.
1 True
2 False
10 Voluntary unemployment occurs when individuals choose not to be employed
because they are not willing to work for the current wage rate.
1 True
2 False
11 Cyclical unemployment is the result of a downturn in economic activity.
1 True
2 False
12 An increase in the price level is the same as a decrease in the value of
money.
1 True
2 False
13 If the nominal interest rate is 7% and the inflation rate is 5%, the real interest
rate is 12%.
1 True
2 False
14 A changes in prices of a good indicate that the market for that good is in
equilibrium.
1 True
2 False
15 The impact lag is shorter for monetary policy than for fiscal policy.
1 True
2 False
16 We have observed that both the price and the quantity sold of golf balls are
raising over time. This is due to …..
1 continual improvements in the technology used to produce
golf balls.
2 increases in the price of golf clubs over time.
3 decreases in membership fees for country clubs with golf
facilities.
4 an increase in the number of country clubs with golf facilities.
3
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