ECON 304 FINAL PAPER 2025/2026 QUESTIONS WITH
ANSWERS GRADED A+
✔✔If Supply shifts to the left - ✔✔Price will increase and Quantity will decrease
✔✔Which of the following is not illustrated by the Production Possibilities Model -
✔✔Increasing Marginal Product
✔✔The Law of Demand says that - ✔✔An increase in price will result in a decrease in
quantity
✔✔Which of these is not a problem with the command economy? - ✔✔Freedom of
Enterprise
✔✔If A and B are subsitutes
An increase in the price of a subsitute (good B) will - ✔✔Shift the demand to the right for
good A
✔✔If A and B are complements
A decrease in the price of a complement (good B) will - ✔✔Shift the demand to the right
for good A
✔✔An Increase in Income will - ✔✔Shift the demand for an inferior good to the left
✔✔A decrease in Income will - ✔✔Shift the demand for an inferior good to the right
✔✔I the price of beer (PB) = $10 and the price of Apples (PA) = $10 and your income
(INC) = $100
and B= the number of beers that you buy and A=the number of Apples that you buy
If I put B on the verticle axis what is the equation for this budget without the values of
the parameters entered? - ✔✔B = -(PA/PB)(A) + INC/PB
✔✔I the price of beer (PB) = $10 and the price of Apples (PA) = $10 and your income
(INC) = $100
and B= the number of beers that you buy and A=the number of Apples that you buy
If I put B on the verticle axis what is the equation for this budget with the values of the
parameters entered? - ✔✔B = -A + 10
✔✔If the price of beer (PB) = $10 and the price of Apples (PA) = $20 and your income
(INC) = $100
and B= the number of beers that you buy and A=the number of Apples that you buy
What is the most amount of Apples that I can buy? - ✔✔5
, ✔✔If the price of beer (PB) = $10 and the price of Apples (PA) = $20 and your income
(INC) = $100
and B= the number of beers that you buy and A=the number of Apples that you buy
If you bought 3 apples how many beers could you buy? - ✔✔4
✔✔A market economy works best when there is no government intervention - ✔✔False
✔✔Which of the following has generally been considered historically to be the best
example of a market economy - ✔✔Hong Kong
✔✔What are the two problems with a command economy? - ✔✔Incentive and
Coordination
✔✔Which of the following will shift the demand to the right? - ✔✔An increase in price of
a substitute
✔✔If both demand and supply shift to the right the change in price will - ✔✔be
Ambiguous
✔✔Economics is a - ✔✔Social Science
✔✔Economists generally claim the they do - ✔✔Positive Economics
✔✔Microecoomics is concerned with - ✔✔Producers and Consumers
✔✔The Law of Supply says that - ✔✔An increase in price will result in an increase in
quantity
✔✔Opportunity Cost - ✔✔Is the cost of the next best thing you had to give up to do
something
✔✔Which of following will shift the supply to the left - ✔✔An increase in taxes
✔✔Rent Control is an example of a price floor - ✔✔False
✔✔Minimum wage is an example of a price ceiling. - ✔✔False
✔✔Which of the following is not a demand function - ✔✔P = 30 + Q
✔✔Left shoes and right shoes are complements - ✔✔true
✔✔Distribution can be a problem with the market economy. - ✔✔true
ANSWERS GRADED A+
✔✔If Supply shifts to the left - ✔✔Price will increase and Quantity will decrease
✔✔Which of the following is not illustrated by the Production Possibilities Model -
✔✔Increasing Marginal Product
✔✔The Law of Demand says that - ✔✔An increase in price will result in a decrease in
quantity
✔✔Which of these is not a problem with the command economy? - ✔✔Freedom of
Enterprise
✔✔If A and B are subsitutes
An increase in the price of a subsitute (good B) will - ✔✔Shift the demand to the right for
good A
✔✔If A and B are complements
A decrease in the price of a complement (good B) will - ✔✔Shift the demand to the right
for good A
✔✔An Increase in Income will - ✔✔Shift the demand for an inferior good to the left
✔✔A decrease in Income will - ✔✔Shift the demand for an inferior good to the right
✔✔I the price of beer (PB) = $10 and the price of Apples (PA) = $10 and your income
(INC) = $100
and B= the number of beers that you buy and A=the number of Apples that you buy
If I put B on the verticle axis what is the equation for this budget without the values of
the parameters entered? - ✔✔B = -(PA/PB)(A) + INC/PB
✔✔I the price of beer (PB) = $10 and the price of Apples (PA) = $10 and your income
(INC) = $100
and B= the number of beers that you buy and A=the number of Apples that you buy
If I put B on the verticle axis what is the equation for this budget with the values of the
parameters entered? - ✔✔B = -A + 10
✔✔If the price of beer (PB) = $10 and the price of Apples (PA) = $20 and your income
(INC) = $100
and B= the number of beers that you buy and A=the number of Apples that you buy
What is the most amount of Apples that I can buy? - ✔✔5
, ✔✔If the price of beer (PB) = $10 and the price of Apples (PA) = $20 and your income
(INC) = $100
and B= the number of beers that you buy and A=the number of Apples that you buy
If you bought 3 apples how many beers could you buy? - ✔✔4
✔✔A market economy works best when there is no government intervention - ✔✔False
✔✔Which of the following has generally been considered historically to be the best
example of a market economy - ✔✔Hong Kong
✔✔What are the two problems with a command economy? - ✔✔Incentive and
Coordination
✔✔Which of the following will shift the demand to the right? - ✔✔An increase in price of
a substitute
✔✔If both demand and supply shift to the right the change in price will - ✔✔be
Ambiguous
✔✔Economics is a - ✔✔Social Science
✔✔Economists generally claim the they do - ✔✔Positive Economics
✔✔Microecoomics is concerned with - ✔✔Producers and Consumers
✔✔The Law of Supply says that - ✔✔An increase in price will result in an increase in
quantity
✔✔Opportunity Cost - ✔✔Is the cost of the next best thing you had to give up to do
something
✔✔Which of following will shift the supply to the left - ✔✔An increase in taxes
✔✔Rent Control is an example of a price floor - ✔✔False
✔✔Minimum wage is an example of a price ceiling. - ✔✔False
✔✔Which of the following is not a demand function - ✔✔P = 30 + Q
✔✔Left shoes and right shoes are complements - ✔✔true
✔✔Distribution can be a problem with the market economy. - ✔✔true
