Let's Have A Quiz

Assalammualaikum. How are you ? As i told you before, I will give a quiz . Remember to submit it to me on Monday, 13.February.2012.

Ready ?

  
 SECTION A

1. What is the “quantity demanded”?

• A. the amount of a good people desire
• B. the amount of a good people are able and willing to buy during a specific time period and at given price
• C. the amount of a good people are able and willing to buy at all possible prices    
• D. the maximum amount of a good that can be consumed during a specific time period

12.     The law of demand refers to how

• A. demand changes when people’s incomes change.
• B. demand changes when the prices of substitutes and complements change.
• C. the quantity demanded changes when the price of the good changes.
• D. the price of the good changes when people’s demand for the good changes.

13.     The law of demand says that when the price of a product rises, the quantity demanded decreases. 

          Why would people buy fewer CDs if the price of a CD rises?

• A.When the price rises, people get less pleasure from listening to music.
• B. If CDs become more expensive, people switch to relatively less expensive alternative  goods, like cassette tapes.
• C. Higher prices just turn people off.
• D. Because CDs are a normal good.

14.     In stores, it is common to find products marked as “On Sale” at a lower than usual price. What explains this behavior?

• A. The law of demand is being used to increase the quantity demanded.
• B.The store is trying to increase its customers’ demand for the product.
• C. The store manager must be trying to drive away customers by selling low quality products.
• D.  Economics cannot explain this phenomenon.

 

15.     The law of demand implies that, other things remaining the same,

• A. as the price of a cheeseburger rises, the quantity of cheeseburgers demanded will increase.
• B.as the price of a cheeseburger rises, the quantity of cheeseburgers demanded will decrease.
• C.as income increases, the quantity of cheeseburgers demanded will increase. 
• D.as the demand for cheeseburgers increases, the price of a cheeseburger will fall. 

SECTION B

1.      1. Differences between Microeconomics and Macroeconomics?

 2. What is the meaning of scarcity and oppurtunity costs?

 3.  List the internal factors and external factors of demand?

 4. Explain the difference between a change in demand and a change in quantity demanded. What leads to each of these changes?  

 5.  If the quantity demand for chicken increases by 20% when the price of beef increases from RM0.40 to RM0.50, calculate the cross elasticity of demand between chicken and beef.