ECS1500_Exam_Pack_Revision_Q_and_A.pdf

ECS1500_Exam_Pack_Revision_Q_and_A.pdf Multiple Choice Questions (Section A): (A) 1. A normal good is one for which the income elasticity is greater than one. a. True b. False 2. The demand for a good, perceived by the consumer to be a necessity, will tend to be elastic. a. True b. False 3. Macroeconomics is concerned with the study of how households and firms make decisions and how they interact in specific markets a. True b. False 4. Price and quantity demanded for most goods are positively related a. True b. False 5. If three variables are related, one of them must be held constant when plotting the other two in the by-coordinate system a. True b. False 6. A 50% increase in price, which results in a 90% decrease in the quantity demanded, indicates that demand is elastic in this price range a. True b. False 7. Absolute advantage is a comparison based on productivity a. True b. False