practice multiple choice questions

practice multiple choice questions - ECOS2001 Intermediate...

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1 ECOS2001 – Intermediate Microeconomics Practice multiple choice questions For Mid-Semester Exam 1. If you have an income of $18 to spend, if commodity X costs $2 per unit, and if commodity Y costs $16 per unit, then the equation for your budget line can be written as a. X/2 + Y/16 = 18. b. (X + Y)/18 =18. c. X + 8Y = 9. d. 2(X + Y) = 9. e. 2(X + 8Y) = 8. 2. Your budget is such that you could exactly afford either 3 units of X and 9 units of Y, or 4 units of X and 8 units of Y. How many units of Y could you buy if you spent all of your income on Y? a. 11. b. 12. c. 13. d. 14. e. 15. 3. If she spends her entire budget, Betsy can afford 24 peaches and 15 watermelons. She can also just afford 14 peaches and 17 watermelons. Each peach costs $1. What is the price of a watermelon? a. $5. b. $6. c. $7. d. $8. e. $9. 4. If all prices and income increase by 10%, then the budget line will: a. Rotate clockwise around the x axis intercept. b. Shift inward. c. Shift outward. d. Stay unchanged. e. Rotate clockwise around the y axis intercept 5. Preferences are said to be monotonic if a. all goods must be consumed in fixed proportions. b. all goods are perfect substitutes. c. more is always preferred to less. d. there is a diminishing marginal rate of substitution. e. None of the above. 6. Charlie has the utility function U(X, Y) = XY. His indifference curve passing through 6 apples and 8 bananas will also pass through the point where he consumes 2 apples and
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2 a. 6 bananas. b. 12 bananas c. 25 bananas d. 54 bananas e. 24 bananas. 7. Michelle is always willing to give up two units of apples to get a unit of oranges. Her indifference curves are: a. Strictly convex b. Strictly concave c. May cross d. Upward sloping straight lines e. Downward sloping straight lines 8. Charlie's utility function is U(X, Y) =4X+4Y – perfect substitutes. If Charlie's income is $60, the price of apples – good X, is $10, and the price of bananas – good Y, is $6, how many apples would
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This note was uploaded on 04/14/2010 for the course E&B 309013097 taught by Professor Oleksiibirulin during the Three '10 term at University of Sydney.

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practice multiple choice questions - ECOS2001 Intermediate...

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