1.

Multiple choice questions

(2 points for each questions)

1.S1: Mercantilists believed in

laissez-faire

S2: For Adam Smith,

in a primitive economy

the labor used to produce

a commodity

exclusively determines its value

-

S1 is true, S2 is false

-

S1 is false, S2 is true

-

both statements are false

-

both statements are true

2.

Which of the above could be considered a

pioneering

contribution of

physiocratic school?

-

physiocrats were

among the first to support government intervention in the

economy

-

physiocrats considered economic laws and developed the theory of the

economy as a whole

-

physiocrats were the pioneers of microeconomic analysis

-

physiocrats developed labor theory of value

3.

Division of labor, according to Smith, increases output through three

mechanisms. Which of the mechanisms does

not

belong to the list?

-

specialization that drives skill improvement

-

time

-

saving techniques while not switching between the tasks

-

specialization that drives international competitiveness

-

innovation at the workplace

4.

Which of the following economists did not support the belief in a long

-

run

subsistence wage

?

-

Malthus

-

Ricardo

-

Smith

-

All of the above support it

5.

Which pair of concepts a

nd assumptions best characterizes the economic

ideas of Carl Menger?

-

supply

-

based theory of prices; increasing returns to scale in production

-

supply

-

based theory of prices; decreasing marginal utility

-

demand

-

based theory of prices; decreasing

marginal utility

-

demand

-

based theory of prices; increasing marginal utility

6.

Which of the following does

not

belong to the long

-

term phenomena of

capitalist development, according to Marx?

-

falling rate of profit

-

immiserization of the proletariat

-

centralization of capital

-

equilibrium on markets for labor and capital

7.

Choose an economist who was holding socialist views

-

David Ricardo

-

Thomas Malthus

-

Oscar Lange

-

Carl Menger

8.

What was the objective of economic policy, according to

Bentham?

-

GDP growth

-

sustainable development

-

freedom and democracy for everyone

-

the greatest happiness for the greatest number of people

9.

Which of these concepts is associated with Alfred Marshall?

-

Consumer surplus

-

General equilibrium

-

Comparative advantage

-

Division of labor

10.

According to the classical school,

money neutrality

means that

-

Money could belong to anyone,

we should not get involved into the issues of

unequal distribution

-

Changes in the amount of money do not influence the real parameters in the

economy, we should not care about these changes

-

Changes in

technology do not influence the production of new mone

y, we

should not care about these changes

-

Money could be invested anywhere, we should not get involved into the issues

of right or wrong investment

11.

According to Hume, the increase of domestic exports

-

makes domestic goods relatively cheaper

-

makes dom

estic goods relatively more expensive

-

does not influence the relative price of domestic goods

-

decreases domestic wages

12.

What was Ricardo's suggestion to postpone the stationary state?

-

Expropriate the capital from capitalists and distribute it

among workers

-

Abolish Corn laws

-

Abolish Poor laws

-

Expropriate the capital from capitalists and distribute it among landowners

13.

Marx's idea of alienation implies that

-

The more productive the workers, the more powerful they become

-

Less

productive workers get less of their fair share

-

The more productive the workers, the more powerful the capitalists become

-

Less productive workers feel less comfortable at work

14.

The notion of Pareto

-

efficiency is problematic, because

-

It ignores interna

tional trade

-

It does not consider the idea of free competition in goods and services

-

It misses the long

-

term outcomes of policies

that are

inefficient in the short

-

run

-

All of the above

15.

Which school/stream of economic thought was an element of Marshall

's

synthesis?

-

mercantilism

-

physiocracy

-

socialism

-

classical school