vu eco402 Final Term - Quiz No.7
vu eco402 Microeconomics Quiz
This quiz belongs to book/course code vu eco402 Microeconomics of vu organization. We have 8 quizzes available related to the book/course Microeconomics. This quiz has a total of 10 multiple choice questions (MCQs) to prepare and belongs to topic Final Term. NVAEducation wants its users to help them learn in an easy way. For that purpose, you are free to prepare online MCQs and quizzes.
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Question 1: The ratio of the wage rate to rental cost of capital is called
Slope of isoquant
Slope of indifference curve
Slope of isocost
Slope of production function
Question 2: If the percentage change in quantity demand for milk is same as the percentage change in price of milk then the price elasticity of demand for milk is:
Elastic
Inelastic
Unitary elastic
Perfectly elastic
Question 3: If a change in the price of one good has no effect on the quantity demanded of another good, then both goods are __________.
Complement of each other
Substitute of each other
inferior
Independent
Question 4: Which of the following is included in economic depreciation to make it equal to the user cost of capital?
Interest Rate * Vlue of Capital
Interest Rate − Vlue of Capital
Interest Rate / Vlue of Capital
Interest Rate + Vlue of Capital
Question 5: Which of the following is correct mathematical formula of marginal cost?
∆TC+∆Q
∆TC−∆Q
∆TC*∆Q
∆TC/∆Q
Question 6: The cost associated with opportunities that are foregone when a firm's resources are not put to their highest value use is called
Opportunity cost
Accounting cost
Marginal cost
Economic cost
Question 7: If gasoline sales were taxed, the price of gasoline would rise. Consequently, the quantity demanded of gasoline would decline. As a result of the higher gasoline prices, the demand for fuel-efficient automobiles would increase. This statement is
essentially correct.
incorrect; the high gasoline prices would cause the demand for gasoline, not the quantity demanded, to fall.
incorrect; the statement confuses a change in demand with a shift in supply.
incorrect; demand and quantity demanded are confused for both gasoline and fuel efficient cars.
Question 8: As the price of gasoline rose, consumers decreased their quantity demanded. In addition, the demand for compact cars increased, causing their price to rise. This statement
is essentially correct.
contains one error the quantity demanded, not the demand for compact cars, increased.
contains two errors demand and quantity demanded are confused twice.
contains one error demand, not quantity demanded, for gasoline decreased.
Question 9: The invisible hand principle indicates that competitive markets can help promote the efficient use of resources
only if buyers and sellers really care, personally, about economic efficiency.
even when each market participant cares only about getting a "bigger slice of the pie" rather than about the overall efficiency of resource use.
even if business firms fail to produce goods efficiently.
if, and only if, businesses recognize their social obligation to keep costs low and use resources wisely.
Question 10: Does voluntary exchange create wealth (value)?
No, exchange does not expand output.
No, if one person gains, the other party must lose an equal amount.
Uncertain, it does when it results in the creation of additional goods and services; otherwise it does not.
Yes, trade generally permits the trading partners to gain more of what they value; this is why they agree to the terms of the exchange.
