Sophia Microeconomics Final Milestone.docx - Microeconomics...

Microeconomics – Final Milestone
22 questions were answered correctly .
3 questions were answered incorrectly .
1
Assuming ceteris paribus, which of the following is FALSE?

When the price of a good rises, the quantity supplied of that good rises.

When the price of a good falls, the quantity demanded of that good rises.

When the price of a good rises, the quantity demanded of that good rises.

When the price of a good falls, the quantity supplied of that good falls.
CONCEPT
Demand
Supply
2
Which of the following is a characteristic of monopolistic
competition?
CONCEPT
Monopolistic Competition
3
Which of the concepts below is a characteristic of a Veblen good?

As income increases, demand for less expensive goods decreases.

As price of the good increases, demand for it increases to establish prestige.

An increase in price of the good causes a decrease in quantity demanded.

A good that offers better quality and features that is consumed when income rises.
CONCEPT
Types of Goods
4
Which of the following is an example of moral hazard?
CONCEPT
Details on Regulatory Intervention and Market Failure
5
Which scenario corresponds with economies of scale?

A decrease in production will cause the next unit to cost the same.

A decrease in production will cause the next unit to first increase in cost, then decrease,
then increase again.

An increase in production will cause the cost of the next unit to increase.

An increase in production will cause the cost of the next unit to decrease.
CONCEPT
Economies, Constant and Diseconomies of Scale

6
This firm is currently producing at 25 units; which of the following
should it do in order to maximize profit?