:5'.\";:" 5L}? 1'" 'ltismw UNIVERSITI . TEKNOLOGI 6 MARA FINAL ASSESSMENT ECONOMICS (50041 5) (1 HOUR so MINUTES) You have 1 hour 30 minutes to answer all MCQ questions (Part A). upload answer sheet for case study (Part B) and submit accordingly. There are total 30 questions of multiple choice. please answer ALL questions and click submit at the end. Assignment will be auto submitted once time ended. Should you encounter any problem during the test. you are required to Contact your lecturer immediately. PART A 1. Which of the following will notcause the demand for product K to change? a change in the price of close-substitute product J an increase in incomes of buyers of product K a change in the price of product K a change in consumer tastes for product K 9-5717!\" 2. if the demand curve for product B shifts to the right as the price of product A declines. then both A and B are inferior goods. A is a superior good and Bis an inferior good. A is an inferior good and B is a superior good. A and B are complementary goods. PF'P'F' "It'll 3. An increase in the quantity demanded means that a. given supply, the price of the product can be expected to decline b. price has declined and consumers therefore want to purchase more of the product. c. the demand curve has shifted to the right. d. the demand curve has shifted to the left. 4. In which of the following statements are the terms 'demand" and \"quantity demanded' used correctly? a. When the price of ice cream rose, the demand for both ice cream and ice cream toppings fell. b. When the price of ice cream rose. the quantity demanded of ice cream fell, and the demand for ice cream toppings fell. (2. When the price of ice cream rose, the demand for ice cream fell. and the quantity demanded of ice cream toppings fell. d. None of these choices are correct. 5. In moving along a supply curve, which ofthe following is not held constant? a. the number of rms producing this good I). expectations about the future price of the product c. techniques used in producing this product d. the price of the product itself 5" Other things equal, if the price of a key resource used to produce product X falls, the supply curve of product X will shift to the right. demand curve of product it will shift to the right. supply curve of product X will shift to the left. supply curve of product X will not shift. sees :4 A government subsidy to the producers of a product reduces product supply. increases product supply. reduces product demand. increases product demand. 53-99"? F\" If there is a surplus of a product, its price is below the equilibrium level. is above the equilibrium level. will rise in the near future. is in equilibrium. 9-9 F!\" 5" At the current price, there is a shortage of a product. We would expect price to increase, quantity demanded to increase, and quantity supplied to decrease. increase, quantity demanded to decrease, and quantity supplied to increase. increase, quantity demanded to increase, and quantity supplied to increase. decrease. quantity demanded to increase. and quantity supplied to decrease. P-PF'P' 2H] 10. Assume that the graphs show a competitive market for the product stated in the question. Price Price O Quantity Quantity Graph A Graph B Price Price Pa O QF Q, Quantity Quantity Graph C Graph D Select the graph above that best shows the change in the market specified in the following situation: the market for chicken, when the price of a substitute, such as beef, decreases. a. Graph A b. Graph B Graph C d. Graph D 11. Suppose that as the price of Y falls from $2.00 to $1.90, the quantity of Y demanded increases from 110 to 118. Then the absolute value of the price elasticity (using the midpoint formula) is approximately a. 4. b. 2.09 C. 1.37. d. 3.94. 12. If a firm can sell 500 units of product A at $4 per unit and 800 at $3, then the price elasticity of demand is approximately 0.62. b. A is a complementary good. . the price elasticity of demand is approximately 1.62. d. A is an inferior good. 13. Suppose the price elasticity of supply for crude oil is 2.5. How much would price have to rise to increase production by 20 percent? a. 8 percent b. 12.5 percent c. 20 percent d. 45 percent 3/11l 14. 15. 16. 17. A price increase from 530 to $35 results in an increase in quantity Supplied from 400 units to 480 units. The price elasticity of supply in this price range is 0.7. 1 .1 B. 0.85. 1.42. ease A perfectly inelastic demand schedule rises upward and to the right but has a constant slope. can be represented by a line parallel to the vertical axis. cannot be shown on a two-dimensional graph. can be represented by a line parallel to the horizontal axis. eons Price elasticity of supply will increase when the number of producers selling a product decreases. producers are given less time to respond to price changes the number of consumers wanting to purchase a product increases. it becomes easier to substitute one factor of production for another in a manufacturing process. eons Assume that the only variable resource used to produce output Is labor. - mount of Labo Total Product Refer to the provided table. Diminishing marginal returns set in with the addition of the rst unit of labor. second unit of labor. third unit of labor. fourth unit of labor. ease I'II'II L 18. Assume that the only variable resource used to produce output is labor. Amount of Labor Total Product 1 6 16 24 ICT AWN 30 34 36 Refer to the provided table. When the firm hires four units of labor, the average product of labor is 5 units of output. b. 7.50 units of output. c. 8.50 units of output. d. 30 units of output. 19. Assume that in the short run a firm is producing 100 units of output, has average total costs of $200, and has average variable costs of $150. The firm's total fixed costs are. $5,000. b. $500. C. $0.50. d. $50. 20. Assume that in the short run a firm is producing 100 units of output, has average total costs of $200, and has average variable costs of $150. The firm's total variable costs are. $15,000. b. $20,000. C. $50. d. $5,000. 21. Answer the question on the basis of the following cost data. Output Total Cost ($) 0 $24 1 33 2 41 3 48 4 54 61 69 The total variable cost of producing 3 units of output is a. $8 b. $24. C. $16. d. $12. 5/11L 22. Answer the question on the basis of the following cost data. Output Total Cost ($) 0 24 33 2 41 3 48 4 54 61 69 The marginal cost of producing the sixth unit of output is a. $12. b. $8. c. $24. d. $45. 23. Inflation means that all prices are rising, but at different rates. b. all prices are rising at approximately the same rate. C. prices on average are rising, although some particular prices may be falling. d. real incomes are rising. 24. Unlike demand-pull inflation, cost-push inflation a. causes the supply of goods and services to decline. b. drives up the price level. C. increases nominal income. d. increases real income. 25. Tariffs a. may be imposed either to raise revenue (revenue tariffs) or to shield domestic producers from foreign competition (protective tariffs). b. are also called import quotas. are excise taxes on goods exported abroad. are per-unit subsidies designed to promote exports. 26. Country A limits other nation's exports to Country A to 1,000 tons of coal annually. This is an example of a(n) a. protective tariff. b. export subsidy. C. import quota. d. voluntary export restriction. 6/11J 27. As it relates to international trade, dumping is a form of price discrimination illegal under US. antitrust laws. is the practice of selling goods in a foreign market at less than cost. constitutes a general case for permanent tariffs. is dened as selling more goods than allowed by an import quota. 23-3757?" 28. The purchase and sale of government securities by the central bank is called a. the federal funds market. b. open-market operations. 0. money market transactions. d. term auction facility. 29. Contractionary scal policy is so named because it involves a contraction of the nation's money supply. necessarily reduces the size of government. is aimed at reducing aggregate demand and thus achieving price stability. is expressly designed to expand real GDP. 5199'!\" 30. "The nation needs to prevent foreign nations from selling their excess goods in our nation at a price below cost so we can save American rms." This quotation would be most closely associated with which protectionist argument? increase domestic employment protection against dumping strategic trade policy cheap foreign policy 53-957!\