Microeconomics MCQs Quiz Multiple Choice Questions & Answers

1. Normally, the natural economy is characterized by:

1. price formation through complex mechanisms
2. perfect competition
3. the preponderance of product exchange
4. the satisfaction of the individual and community needs of its own production

2. The profit maximization condition for a firm in a market with monopolistic competition is the following (MR is marginal revenue, MC is marginal cost, P is price, ATC is average total cost, TR is total revenue):

1. MR = MC
2. MC = P
3. MR = ATC
4. TR to be maximum

3. Which of the following can be considered as the basic features of public goods:

1. are state-owned
2. are characterized by non-excludability and non-rivalry
3. are characterized by excludability and rivalry
4. may be positive or negative

4. Which of the following conditions indicate that a good is produced under perfect competition:

1. producers profits are high
2. producers profits are small
3. total supply is inelastic
4. individual demand is perfectly elastic

5. Which of the following features define human needs:

1. are not concurrent
2. do not disappear momentarily if they are satisfied
3. are unlimited in capacity
4. are unlimited in number

6. Which of the following solutions are not part of the ways of internalizing externalities:

1. the imposition of fines on the producer of negative externalities
2. the introduction of taxes and duties that bring private costs to the level of social costs
3. closure of companies producing positive or negative externalities
4. the association of the negative externality manufacturer with the receptor of such an effect

7. Which of the following statements about monopoly is true:

1. there are several companies producing a specific product
2. there is only one producing company, but the product has close substitutes
3. there are no competitors on the relevant market
4. input barriers are low

8. An economic agent contracts a loan of 15.000 lei, which he will repay in three equal annual installments. What will be the total interest paid, knowing that the annual interest rate is 12% per year?

1. 3600 lei
2. 1800 lei
3. 5400 lei
4. 1500 lei

9. An economic agent makes a bank deposit of 10.000 lei with an interest rate of 5%. What will be the amount in the bank after 2 years, if the economic agent does not make withdrawals from the account created during this period?

1. 11000 lei
2. 1000 lei
3. 11025 lei
4. 500 lei

10. Calculate the average fixed cost (AFC), for a level of production Q = 20, knowing that the total cost function is: TC = 200 + 3Q + 2Q2

1. 1060
2. 200
3. 20
4. 10

11. Choose the false statement:

1. in general, the demand for necessity goods is less elastic than demand for luxury goods
2. if the price and the producers income are directly proportional, the demand is elastic
3. after a long period of time since the change in the price of the good A, supply becomes more elastic
4. for a company whose production process involves making two goods, one main and the other secondary, if the price of the main good increases, - caeteris paribus - the supply onthe secondary goods market will increase (and vice versa)

12. For a rational consumer who has to choose between two goods in the context of budget constraints, the price change of one of the goods, caeteris paribus, will determine:

1. a parallel shift of the budget line to the left
2. a change in the slope of the budget line
3. no change in the budget line
4. a parallel shift of budget line to the right

13. If the coefficient of income elasticity of demand is higher than 1 and the revenue increases, the share of expenditures for commodity X in total expenditure:

1. will increase
2. will decrease
3. will remain constant
4. can not be determined

14. If the demand curve for product A moves to the right, and the price of product B decreases, it can be concluded that

1. A and B are substitute goods
2. A and B are complementary goods
3. A is an inferior good, and B is a superior good
4. Both goods A and B are inferior

15. If the demand for agricultural products is inelastic:

1. as the prices decrease, the revenues earned by producers increase
2. as the prices decrease, the revenues earned by producers decrease
3. rising prices do not lead to differentiation in producers incomes
4. the percentage decrease in prices is lower than the percentage increase in demand

16. On the market with perfect competition

1. the firm is a price-taker, meaning, it takes over the market price
2. the firm is a price-maker, meaning, it determines the market price
3. the companies’ products are differentiated
4. input barriers are minimal, and exit barriers are maximal

17. Suppose the price of a good decreases by 10% and the quantity demanded for a certain period of time increases by 15%. In these conditions:

1. the revenues earned by producers decrease
2. the revenues earned by producers increase
3. the revenues are not influenced in any way
4. the companys expenses rise

18. Suppose the supply for product A is perfectly elastic. If the demand for this product increases:

1. the equilibrium price and quantity will increase
2. the equilibrium price and quantity will decrease
3. the equilibrium quantity will increase but the price will not change
4. the equilibrium price will increase but the quantity will not change

19. The following data is given for a company: material costs 89 mil; working capital 45 mil; indirect salaries 10 mil; fixed costs 90 mil.; variable costs 52 mil. Calculate fixed material costs and depreciation:

1. 60 and 64
2. 70 and 56
3. 80 and 44
4. 89 and 45

20. The indifference curve means:

1. equal consumption of two goods
2. equal utility from the consumption of two combinations of goods
3. equal consumer income
4. equal prices of the goods consumed

21. The points located at the intersection of the budget line with the coordinate axes mean:

1. the consumer does not spend all his income
2. the consumer spends all his income for only one good
3. the consumer spends absolutely nothing
4. these are points impossible to reach by the consumer

22. The price of the product A was reduced from 100 to 90 lei and, as a result, the quantity demanded has increased from 70 to 75 units. The demand is:

1. inelastic
2. elastic
3. unit elastic
4. can not be determined from the given information

23. The total utility coincides with the marginal utility:

1. for the first unit consumed
2. only for the irrational consumer
3. at the level of the last unit consumed
4. at the saturation point

24. There are differences between monopolistic and perfect competition regarding:

1. market entry
2. the number of sellers and buyers
3. the market power of competitors
4. homogeneity of products

25. Which of the following statements are false?

1. information, the entrepreneurs ability, technical progress are neo-factors of production
2. according to the stages of the circular flow of the companys capital, it takes three forms money, capital goods and commodity
3. fixed capital depreciation is only due to physical deterioration
4. the factors of production are resources attracted and used in economic activity

26. Which of the following statements is false:

1. perfect competition involves many sellers of standardized products
2. monopolistic competition involves many sellers of homogeneous products
3. the oligopoly involves several producers of standardized or differentiated products
4. monopoly involves a single product for which there are no close substitutes