Introduction to Microeconomics quiz

Which of the following is studied in microeconomics?

The PPF is concave to the origin because of:

A point inside the PPF shows:

The problem of for whom to produce relates to:

Opportunity cost is the value of:

Which statement is normative?

A rightward shift of the PPF can be caused by:

In a centrally planned economy, the central problems are solved by:

If MRT is constant, the PPF is:

Choice of labour-intensive or capital-intensive technique is the problem of:

Why does an economic problem arise? (2 marks)

What is meant by the problem of what to produce? (2 marks)

Distinguish between a market economy and a centrally planned economy. (2 marks)

Why is a point outside the PPF unattainable? (2 marks)

Give two reasons for a leftward shift of the PPF. (2 marks)

Explain the relationship between opportunity cost and MRT. (2 marks)

What is a mixed economy? Give one example. (2 marks)

Will the opening of new schools in a country shift its PPF? Explain. (2 marks)

Why is microeconomics also called price theory? (2 marks)

Can the PPF be convex to the origin? Explain. (2 marks)

An economy can produce (X, Y) = (0, 100), (10, 90), (20, 70), (30, 40). Calculate the MRT of X for Y at each step and comment on the trend. (3 marks)

Neha leaves a job paying Rs 3 lakh per year to study full time for two years. She also has another job offer of Rs 2.5 lakh per year. Calculate the opportunity cost of her studies in terms of earnings forgone. (3 marks)

A PPF passes through (X, Y) = (0, 50), (5, 45), (10, 35), (15, 20), (20, 0). Classify the points (10, 30), (15, 25) and (5, 45) as efficient, inefficient or unattainable. (3 marks)

An economy is producing (4 units of X, 5 units of Y), while its PPF passes through (4, 11). Calculate the extra output of Y possible and the percentage by which Y output could rise. (3 marks)

An economy can produce a maximum of 50 units of X or 100 units of Y, with constant MRT. Calculate the MRT and the maximum output of Y when 20 units of X are produced. (3 marks)

Read the passage and answer the questions. A village has 100 hectares of land suitable for wheat or sugarcane. Some land is better suited to wheat, some to sugarcane. As more land is shifted to sugarcane, more and more wheat has to be given up for each extra tonne of sugarcane. (i) Name the concept shown. (ii) What will be the shape of the PPF? (iii) Why does the sacrifice of wheat rise? (5 marks)

Read the passage and answer the questions. During the COVID-19 lockdown, many factories in India shut down and millions of workers became unemployed, though machines and land remained intact. (i) Where will the economy operate relative to its PPF? (ii) Did the PPF shift? Give reason. (iii) Draw a diagram to show the situation. (5 marks)

Read the passage and answer the questions. A new technology doubled the productivity of solar panel factories in a country, but had no effect on other industries. (i) How will the PPF of solar panels and other goods change? (ii) Draw a diagram. (iii) Is this a shift or a rotation? (5 marks)

Read the passage and answer the questions. In India, the government runs railways and defence, while most shops, farms and IT firms are privately owned and sell at market prices. (i) Identify the type of economy. (ii) Who solves the central problems for railways and for IT services? (iii) State one merit of this system. (5 marks)

Read the passage and answer the questions. An economist said: Unemployment in India rose last quarter. Another said: The government should guarantee jobs to all graduates. (i) Classify each statement as positive or normative. (ii) Give the reason for each. (iii) Which can be tested with data? (5 marks)

Explain the central problems of an economy in detail and how they are solved in different economic systems. (6 marks)

Explain the PPF with a schedule and diagram. Why is it concave to the origin? (6 marks)

Explain the conditions under which the PPF shifts to the right, shifts to the left or rotates, with diagrams. (6 marks)

Distinguish between microeconomics and macroeconomics, and between positive and normative economics, with examples. (6 marks)

Explain opportunity cost and MRT with numerical examples and a diagram, showing how they relate to the slope of the PPF. (6 marks)