Page 1 of 47
ECO 211 MIDTERM EXAM MICROECONOMICS
ALL QUESTIONS AND CORRECT ANSWERS
LATEST UPDATE THIS YEAR
ECO 211 MIDTERM EXAM
Which of the following statements describes microeconomics?
a. Inflation in the US increased by 5% in May 2021.
b. The price of beef increased by 15% last month due to a cyber attack on a major beef
processing firm.
c. The federal government lowered corporate tax rates in 2019.
d. The size of the U.S. economy shrunk by 7% in 2020 due to the COVID crisis.
b. The price of beef increased by 15% last month due to a cyber attack on a major beef
processing firm.
In market economies, most decisions are made by ___, while in command economies, most
economic decisions are made by ___.
a. Private citizens and firms; the government
b. Households; local leaders
c. Families, private businesses
d. The government; households and firms
a. Private citizens and firms; the government
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A good economic theory ....
a. A set of mathematical equations representing economic behavior.
b. Must contain a complete representation of real economic events to be useful.
c. is a detailed representation of reality used to explain past economic events.
d. captures the essence of the economic concepts and facilitates their understanding.
d. captures the essence of the economic concepts and facilitates their understanding.
Irfan has the budget constraint described in the graph below. If Irfan purchases 1 hour of
tutoring per month and decides to increase his purchases to 2 hours per month, what is the
opportunity cost of the 2nd tutoring hour?
a.
1 hour of tutoring
b.
2 restaurant meals
c.
6 restaurant meals
d.
4 restaurant meals
b.
2 restaurant meals
Alex has a budget of $100 a month for movie tickets and restaurant meals. A movie ticket will
cost $10 and a restaurant meal costs $20. Which of the following combinations is part of
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Alex's budget constraint?
a. 2 movie tickets and 1 restaurant meal
b. 2 movie tickets and 4 restaurant meals
c. 2 movie tickets and 5 restaurant meals
d. 4 movie tickets and 4 restaurant meals
b. 2 movie tickets and 4 restaurant meals
According to the circular flow diagram, households...
Are sellers in the labor market and buyers in the goods and services market.
The circular flow diagram describes...
How firms and households carry out economic activities through the market for input or factors
of production and the market for goods and services.
Which of the following elements demonstrate the degree of globalization?:
a. Large underground economies.
b. High levels of trade and exchange between countries.
c. A low export to Gross Domestic Product ratio for a country.
d. Rapidly growing Gross Domestic Product for several countries.
B- High levels of trade and exchange between countries.
Which of the following examples represents the relationship between division of labor and
production?-
a. A company assigns different parts of the production process to various workers, which
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complicates the process and results in waste
b. A hospital hires more qualified nurses to ensure better quality of care for patients
c. A nurse takes patients' vital signs while the doctor focuses on diagnosis so that more
patients can receive care
d. A primary care office hires more doctors to ensure that more patients receive care.
c. A nurse takes patients' vital signs while the doctor focuses on diagnosis so that more patients
can receive care
Gross Domestic Product represents...
. The value of the total production in a country
b. The ratio of exports relative to the total production in a country
c. The sum of imports and exports of a country
d. The degree of globalization
a. The value of the total production in a country
Someone criticizes the government for increasing interest rates but approving the increase in
government spending. They are criticizing the government's ____policy and praising the
government ___ policy.
a. Microeconomic, Macroeconomic
b. Fiscal, Monetary
c. Macroeconomic, Microeconomic
d. Monetary, Fiscal
d. Monetary, Fiscal
4
ECO 211 MIDTERM EXAM MICROECONOMICS
ALL QUESTIONS AND CORRECT ANSWERS
LATEST UPDATE THIS YEAR
ECO 211 MIDTERM EXAM
Which of the following statements describes microeconomics?
a. Inflation in the US increased by 5% in May 2021.
b. The price of beef increased by 15% last month due to a cyber attack on a major beef
processing firm.
c. The federal government lowered corporate tax rates in 2019.
d. The size of the U.S. economy shrunk by 7% in 2020 due to the COVID crisis.
b. The price of beef increased by 15% last month due to a cyber attack on a major beef
processing firm.
In market economies, most decisions are made by ___, while in command economies, most
economic decisions are made by ___.
a. Private citizens and firms; the government
b. Households; local leaders
c. Families, private businesses
d. The government; households and firms
a. Private citizens and firms; the government
1
, Page 2 of 47
A good economic theory ....
a. A set of mathematical equations representing economic behavior.
b. Must contain a complete representation of real economic events to be useful.
c. is a detailed representation of reality used to explain past economic events.
d. captures the essence of the economic concepts and facilitates their understanding.
d. captures the essence of the economic concepts and facilitates their understanding.
Irfan has the budget constraint described in the graph below. If Irfan purchases 1 hour of
tutoring per month and decides to increase his purchases to 2 hours per month, what is the
opportunity cost of the 2nd tutoring hour?
a.
1 hour of tutoring
b.
2 restaurant meals
c.
6 restaurant meals
d.
4 restaurant meals
b.
2 restaurant meals
Alex has a budget of $100 a month for movie tickets and restaurant meals. A movie ticket will
cost $10 and a restaurant meal costs $20. Which of the following combinations is part of
2
, Page 3 of 47
Alex's budget constraint?
a. 2 movie tickets and 1 restaurant meal
b. 2 movie tickets and 4 restaurant meals
c. 2 movie tickets and 5 restaurant meals
d. 4 movie tickets and 4 restaurant meals
b. 2 movie tickets and 4 restaurant meals
According to the circular flow diagram, households...
Are sellers in the labor market and buyers in the goods and services market.
The circular flow diagram describes...
How firms and households carry out economic activities through the market for input or factors
of production and the market for goods and services.
Which of the following elements demonstrate the degree of globalization?:
a. Large underground economies.
b. High levels of trade and exchange between countries.
c. A low export to Gross Domestic Product ratio for a country.
d. Rapidly growing Gross Domestic Product for several countries.
B- High levels of trade and exchange between countries.
Which of the following examples represents the relationship between division of labor and
production?-
a. A company assigns different parts of the production process to various workers, which
3
, Page 4 of 47
complicates the process and results in waste
b. A hospital hires more qualified nurses to ensure better quality of care for patients
c. A nurse takes patients' vital signs while the doctor focuses on diagnosis so that more
patients can receive care
d. A primary care office hires more doctors to ensure that more patients receive care.
c. A nurse takes patients' vital signs while the doctor focuses on diagnosis so that more patients
can receive care
Gross Domestic Product represents...
. The value of the total production in a country
b. The ratio of exports relative to the total production in a country
c. The sum of imports and exports of a country
d. The degree of globalization
a. The value of the total production in a country
Someone criticizes the government for increasing interest rates but approving the increase in
government spending. They are criticizing the government's ____policy and praising the
government ___ policy.
a. Microeconomic, Macroeconomic
b. Fiscal, Monetary
c. Macroeconomic, Microeconomic
d. Monetary, Fiscal
d. Monetary, Fiscal
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