Principles of Microeconomics (ECON2101)
Faculty of Economics and Management Science (FEMS)
Semester: Resit
Level: 200
Year: 2015
Instructions: Answer All Questions, Any Cancellation Is Considered a Wrong Answer
Duration: 3hours
1. In positive economics, the subject matter of analysis is on:
a) What ought to be instead of what is
b) What ought to be and what is
c) What will be
d) What is instead of what ought to be
2. In normative economics, the center of the discussion revolves around:
a) What will be
b) What is instead of what ought to be
c) What ought to be and what is
d) What ought to be instead of what is
3. The fundamental economic problem to be answered by every economy include the
questions of:
a) Where are we, where do we go and do we reach there?
b) How much to produce, hoe to sell and where to produce?
c) How to survive, what to produce and when to produce?
d) What to produce, how to produce and for whom to produce?
4. Market equilibrium is:
a) A point where the market forces of a given phenomenon agree at a given time
b) An interval within which the demand and supply of a given phenomenon agree at a
given time.
c) A frame work within which the market is at peak period
d) A position where the market forces of a given phenomenon agree at a given time
5. The factor of production-land refers to:
a) The piece of plot on which an economic activity can be run.
b) The physical assets that enable the undertaking of an economic activity
c) None of the above
d) The area on the surface of the earth on which an economic activity can be run
6. A diagram that best illustrates the economic concept of choice, scarcity and opportunity
cost is:
a) The demand curve.
b) The supply curve
c) The market equilibrium
d) The production possibility curve
7. Risk describes is a situation where:
a) The outcome of an event is known, but the probability of alternative outcomes
unknown
b) The probabilities of different outcomes are known
c) The probabilities of different outcomes are unknown
d) The outcome of an event is unknown, but the probability of alternative outcomes
known
THE UNIVERSITY OF BAMENDA
FACULTY OF ECONOMICS AND MANAGEMENT SCIENCES
1st Semester Resit Course le:Principles of Microeconomics
Course Code: ECON201
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8. Uncertainty depicts a situation where:
a) The probabilities of different outcomes are known
b) The outcome of an event is known, but the probability of alternative outcomes
unknown
c) The outcome of an event is unknown, but the probability of alternative outcomes
known
d) The probabilities of different outcomes are unknown
9. The inductive method of reasoning heavily depends on data collected and proceeds from:
a) General to details
b) Mathematical expression to conceptual expression
c) Conceptual expression to mathematical expression
d) Details to general
10. The deductive method of reasoning heavily depends on established principles and
proceeds from:
a) Details to general
b) Mathematical expression to conceptual expression
c) Conceptual expression to mathematical expression
d) General to details
11. A model is often regarded as:
a) Generalization about a real world phenomenon.
b) A detailed representation of a real world phenomenon
c) An inquiry about the global picture of a real world phenomenon
d) An abstract from a real world phenomenon
12. Which of the following approaches uses qualitative measures of utility?
a) Cardinal approach only
b) Cardinal and ordinal approaches
c) Ordinal approach only
d) None
13. If income elasticity of demand is less than one, what is the nature of the good?
a) Inferior good
b) Normal good
c) Luxury good
d) Substitution good
14. If cross-elasticity of demand is equal to 0, what is the nature of the good?
a) Complementary good
b) Substitution good
c) Independent good
d) None
15. From the graph below, how can you best describe S
4
S
4
?
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a) Relative inelastic supply
b) Perfectly elastic supply
c) Perfectly inelastic supply
d) Relatively elastic supply
1) Stage two of production is characterized by?
a) The variable input is being used with increasing output per unit
b) Output increases at a decreasing rate
c) Variable inputs are over-utilized
d) All
2) The backbone of the market economy is?
a) The production of goods and services
b) The consumption of goods and services (utility)
c) Demand and supply of goods and services
d) The choice of goods and services
3) In the short run analysis of the firm, which cost is most important?
a) Total cost
b) Marginal cost
c) Average cost
d) None of the three
4) Why does the demand curve slopes downward from left to right?
a) Because of the prices of goods and services
b) Because of the quantity of goods and services bought
c) Because of the law of diminishing marginal utility
d) Because of the law of diminishing marginal consumption
5) Where do you classify the market structure for private school in Cameroon?
a) Monopoly market
b) Monopolistic market
c) Oligopoly market
d) Perfect market
6) In the short run, why are the unitary cost curves having a U-shaped?
a) Because there exist only TFC
b) Because of the law of diminishing marginal returns
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c) Because of internal economics of scale
d) Because of internal diseconomies of scale
7) In an industry, when MR>MC, what will the firm di to increase profits?
a) Increase productivity
b) Decrease productivity
c) Increase expenditure
d) Decrease expenditure
8) Considering a long-run situation, what is the nature of the market structure? AC<P=MR=MC=AR
a) Monopoly
b) Perfect market
c) Inequality market
d) None
9) At what quantity are profits maximized in an enterprise?
a) When MR=MC
b) When TR=TC
c) When AR=AC
d) All
10) Where do you classify the market structure of MTN, Orange, CAMTEL, Nextel companies in
Cameroon?
a) Monopoly market
b) Monopolistic market
c) Oligopoly market
d) Perfect market
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