Monopoly SAMPLE MCQ - UOL Intro to Econs Exam Tuition

UOL SAMPLE MCQ On MICRO ECONOMICS - Monopoly  

1) Unregulated monopolies

A) cannot change the market quantity.

B) can influence the market quantity and price.

C) cannot incorporate.

D) take the market price as given.

2) The following are key features of a monopoly EXCEPT

A) diseconomies of scale.

B) no close substitutes.

C) influence over price.

D) barriers to entry

3) A patent grants

A) a guarantee of quality to consumers.

B) an exclusive right to an inventor of a product.

C) the right to practice a profession.

D) control over a unique source or supply of raw materials.

4) Monopolists

A) face downward sloping demand curves.

B) are price takers.

C) have no short-run fixed costs.

D) maximize revenue, not profits.

5) If the price elasticity of demand is less than 1, a monopoly's

A) marginal revenue is undefined.

B) total revenue decreases when the firm lowers its price.

C) total revenue increases when the firm lowers its price.

D) marginal revenue is zero.

6) Which of the following statements is true?

A) A perfectly competitive industry produces more output and charges the same price as a single-price monopoly.

B) A perfectly competitive industry produces less output but charges a lower price than a single-price monopoly.

C) A perfectly competitive industry produces less output and charges the same price as a single-price monopoly.

D) A perfectly competitive industry produces more output and charges a lower price than a single-price monopoly.

7) When an increase in the range of goods produced brings a decrease in the average total cost of production, the firm is experiencing

A) diminishing returns.

B) economies of scale.

C) economies of scope.

D) diseconomies of scale

8) Which of the following is NOT a possible gain to society from a monopoly?

A) The monopoly may induce innovation.

B) The monopoly may achieve economies of scope.

C) The monopoly may create rent seeking.

D) The monopoly may achieve economies of scale

9) Which of the following statements regarding a marginal-cost pricing rule is incorrect?

A) It is efficient.

B) It allows the firm to earn a normal profit.

C) It maximizes total surplus in a regulated industry.

D) It sets price equal to marginal cost.

10) Which of the following may be a gain to society from monopoly?

A) Monopolies may be able to generate economies of scale.

B) Monopolies may earn an economic profit in the long run.

C) Monopolies may be able to price discriminate, thereby boosting consumer surplus.

D) Monopolists do not waste resources trying to innovate.

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UOL SAMPLE MCQ On MICRO ECONOMICS - COST & PRODUCTION for UOL Intro to Econs Exam Tuition

UOL SAMPLE MCQ On MICRO ECONOMICS - COST & PRODUCTION  

1. Increasing returns to scale for a firm are shown graphically by

A) returns to scale have nothing to do with the shape of the long-run average cost curve.
B) a horizontal long-run average cost curve.
C) a vertical long-run average cost curve.
D) an upward-sloping long-run average cost curve. 
E) a downward-sloping long-run average cost curve. 

2. When cost curves are drawn for a firm, all of the following are generally assumed EXCEPT 

A) average fixed costs are constant.
B) firm is too small to influence factor prices.
C) average variable cost initially declines, then rises at higher output levels.
D) total fixed costs are constant.
E) marginal product of the variable factor eventually declines. 

3. Consumer surplus
A) is the difference between what the consumer is willing to pay for all the units consumed and what he/she actually paid.
B) is the total value that a consumer receives from a purchase of a particular good.
C) is a measure of the gains a consumer receives in the market.
D) is the sum of the marginal values to the consumer.
E) is the consumption of a commodity above and beyond the amount required by the consumer.

4. The supply curve remains the same if there is a change in: 

A) the number of suppliers of the commodity
B) technology.
C) the price of the good
D) the price of a commodity that is a substitute or complement in production. 
E) factor costs. 

5. Short-run cost curves rise eventually because of the effects of 

A) the increasing price of variable inputs.
B) increasing marginal productivity of the variable inputs.
C) increasing fixed costs.
D) diminishing marginal product. 
E) decreasing average product. 

6.  A normal good is a good

A) that everyone normally consumes.
B) that normal people consume.
C) whose demand varies directly with household income. 
D) whose demand does not vary with household income. 
E) whose demand varies inversely with household income. 

7. In defining a long-run average cost curve,

A) factor prices are varied and the quantity of factors of production is held constant.
B) factor prices are held constant and technology is assumed to change.
C) the time period must be longer than one year.
D) factor prices are held constant and the quantity of factors of production used is varied. 
E) technology, factor prices, and the quantity of factors of production are all varied. 

8. In the short run, the firm's product curves show

A) TP is at its maximum when MP = O.
B) TP begins to decrease when AP begins to decrease.
C) when MP > AP, AP is decreasing.
D) when the MP curve cuts the AP curve from below, the AP curve begins to fall. 
E) AP is at its minimum when MP = AP. 

9. In the long run, decreasing returns can be caused by 

A) specialization.

B) management diseconomies.
C) a decrease in factor prices.
D) decreasing costs.
E) diminishing returns to the variable factor. 

10. The point of tangency between the short-run average total cost (SRATC) curve and the long-run average cost (LRAC) curve occurs

A) at the output level where the fixed factors are at the optimum quantity.
B) at the point of minimum SRATC.
C) at a point where average total cost is falling but the marginal cost is rising. 
D) at a point where both the average total cost and the marginal cost is rising. 
E) only when the LRAC curve is at its minimum. 

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IS-LM Sample MCQ Questions for Macro Economics - UOL Introduction to Economics

UOL Introduction to Economics Sample MCQ Questions for Macro Economics 

1. What would happen to the IS-LM model when there is an increase in autonomous consumption and contractionary monetary policy was sought to prevent inflation?

A.     The IS curve would shift to the left and the LM curve would shift to the left

B.     The IS curve would shift to the right and the LM curve would shift to the left

C.     The IS curve would shift to the left and the LM curve would shift to the right

D.    The IS curve would shift to the right and the LM curve would shift to the right

2. If the multiplier effect in an economy is 5 times, what will happen to the national income when the government spending decrease by $200  

A.     income will increase by $1000

B.     income will increase by more than $1000 because a reduction in interest rates will increase investment spending

C.     income will increase by less than $1000 because an increase in interest rates will reduce investment spending

D.    income will increase by less than $1000 because an increase in inflation will reduce consumption spending

3. The expansionary policy in an economy cannot be fully experienced by the economy when

A.     money demand is not affected by interest rate changes

B.     the LM curve is vertical

C.     government spending changes do not affect output

D.    all of the above

4. When the government sells bond in the open market

A.     LM will shift to the right

B.     National income will return back to equilibrium when there is flexible prices and wages

C.     Interest rate will fall

D.    None of the above

5. Monetary policy is more effective when

A.     investment is less sensitive to the interest rate

B.     the IS curve is flatter

C.     the LM curve is flatter

D.    all of the above

6. In order for liquidity trap to happen,

A.     the LM curve is horizontal

B.     the LM curve is vertical

C.     monetary policy is very effective

D.    all of the above

7. The government aims to reduce interest rate and boost national income through policy. As a governor, you will choose to

A.     increase government expenditures

B.     increase government expenditures

C.     buy Treasury bonds.

D.    sell Treasury bonds

8. Consider two economies that are identical, except that one has a high marginal propensity to consume (MPC) and one has a low MPC. If the money supply is increased by the same amount in each economy, the high MPC economy will experience

A.     A larger increase in output and a smaller decrease in the interest rate.

B.     A smaller increase in output and a smaller decrease in the interest rate.

C.     A larger increase in output and a larger decrease in the interest rate.

D.    None of the above.

9. Suppose an economy is running a government budget surplus. Assume that C = c0 + c1(Y-tY). Which one of the following will cause this surplus to become larger?

A.     Expansionary monetary policy.

B.     An increase in exports.

C.     An increase in equilibrium GDP.

D.    A decrease in taxes.

10. If investment in the goods market is not interest sensitive,

A.     IS curve is a vertical line and monetary policy is very effective in raising output.

B.     IS curve is a horizontal line and monetary policy is very effective in raising output.

C.     The IS curve is a vertical line and monetary policy does not affect output in the IS-LM model.

D.    The IS curve is a horizontal line and monetary policy does not affect output in the IS-LM model.

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Perfect Competition MCQ for YOUR UPCOMING EXAM - UOL INTRODUCTION TO ECONOMICS

UOL INTRODUCTION TO ECONOMICS SAMPLE MCQ

1. Perfect competition is an industry with

A) a few firms selling differentiated goods

B) many firms selling goods that are different in product range.

C) a few firms selling goods that are different in quality.

D) many firms selling homogeneous  goods.

2. In a perfectly competitive industry, there are

A) many buyers and many sellers.

B) many sellers, but there might be only one or two buyers.

C) many buyers, but there might be only one or two sellers.

D) one firm that sets the price for the others to follow.

3) In perfectly competitive market, the product has

A) differentiated cost and same marginal price

B) many perfect complements produced by other firms.

C) many perfect substitutes produced by other firms.

D) different average price and marginal cost.

4) In perfect competition, restrictions on entry into an industry

A) do not exist.

B) apply to labor but not to capital.

C) apply to both capital and labor.

D) apply to capital but not to labor.

5) The price elasticity of demand for any particular perfectly competitive firm's output is

A) zero.

B) one.

C) infinite.

D) more than zero.

6) In perfect competition, the market demand

A) has a price elasticity of supply equal to one.

B) faces downward sloping curve.

C) has a price elasticity of supply equal to infinity.

D) faces horizontal curve.

7) In perfect competition, the price of the product is determined when the

A) elasticity of market demand equals to elasticity of market supply.

B) summation of marginal cost and industry demand curve intersect.

C) fixed cost is minimized.

D) average variable cost equals the industry average total cost

8) Perfectly competitive firms are

            A) Allocative inefficient

           

            B) Productive efficient

            C) Marginal cost inefficiency

            D) Economically efficient

9) In perfect competition, a firm that maximizes its economic profit will sell its good

A) below the market price.

B) above the market price.

C) below the market price if its supply curve is inelastic and above the market price if its supply curve is elastic.

D) at the market price.

10) For a perfectly competitive firm, it will make normal profit when

A) marginal revenue equals its minimum average fixed cost.

B) marginal revenue equals its minimum average cost.

C) total revenue equals its total opportunity cost.

D) marginal revenue exceeds its marginal cost.

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