ECON 201 MIDTERM EXAM QUESTIONS
ANSWERS LATEST UPDATE 2026
Section 1 (5 Questions, 1 point each)
Choose the BEST answer out of all the choices.
Record ONE choice as your answer in the blue book.
1. There are two tailors who can spend their day making either Shirts or Pants. The table below shows
the number of Shirts or Pants each of them can produce in an hour.
Shirts Pants
Thomas 30 20
Tina 25 15
If they trade with each other, should specialize in Shirts, and their opportunity cost of making a
shirt is Pants.
A) Thomas, 1.5
B) Thomas, 2/3
C) Tina, 5/3
D) Tina, 0.6
2. Phizzy Soda is an inferior good that is packaged in aluminum cans. Two market events happen
simultaneously:
1. Consumer incomes rise
2. Aluminum prices fall
What happens to equilibrium price and equilibrium quantity?
A) fall in price, uncertain effect on quantity
B) rise in price, uncertain effect on quantity
C) uncertain effect on price, fall in quantity
D) uncertain effect on price, rise in quantity
3. The government begins collecting a $4 tax from producers of vases. The tax incidence on buyers
will be higher when:
A) The government collects the tax from consumers instead of suppliers
B) Demand for vases is price-elastic, and supply of vases is price-inelastic
C) Demand for vases is price-inelastic, and supply of vases is price-elastic
D) The size of the tax is increased from $4 to $5
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ANSWERS LATEST UPDATE 2026
Section 1 (5 Questions, 1 point each)
Choose the BEST answer out of all the choices.
Record ONE choice as your answer in the blue book.
1. There are two tailors who can spend their day making either Shirts or Pants. The table below shows
the number of Shirts or Pants each of them can produce in an hour.
Shirts Pants
Thomas 30 20
Tina 25 15
If they trade with each other, should specialize in Shirts, and their opportunity cost of making a
shirt is Pants.
A) Thomas, 1.5
B) Thomas, 2/3
C) Tina, 5/3
D) Tina, 0.6
2. Phizzy Soda is an inferior good that is packaged in aluminum cans. Two market events happen
simultaneously:
1. Consumer incomes rise
2. Aluminum prices fall
What happens to equilibrium price and equilibrium quantity?
A) fall in price, uncertain effect on quantity
B) rise in price, uncertain effect on quantity
C) uncertain effect on price, fall in quantity
D) uncertain effect on price, rise in quantity
3. The government begins collecting a $4 tax from producers of vases. The tax incidence on buyers
will be higher when:
A) The government collects the tax from consumers instead of suppliers
B) Demand for vases is price-elastic, and supply of vases is price-inelastic
C) Demand for vases is price-inelastic, and supply of vases is price-elastic
D) The size of the tax is increased from $4 to $5
, 2
