Home CBT TEST ECN 205 CBT PRACTICE

CBT TEST

ECN 205 CBT PRACTICE

Phil

January 15, 2025

Take your time to read instructions before taking this test.

There are 40 questions which you are to answer in 15 minutes that gives you roughly 30 seconds per question.

If you can get at least 60%, you can be rest assured that you’ll ace ECN 205 exam

In a normal exam you will be asked between 40 – 60 questions but I only arranged 40 questions

Note

Do not be in a hurry to answer the questions

Do not waste time on a question you don’t know

Move as fast as possible and starting with questions that don’t have calculation first to save time

Always crosscheck

Don’t be in a hurry to submit, you are not in a competition

Don’t be scared. Getting an A is easy

Don’t be over confident, you can end up a D, E or F. Calm your blood, no be only you sabi book

Please do well to use our comment box incase there’s a message you want to pass to us

70 – 100 A

60 – 69 B

50 – 59 C

45 – 49 D

40 – 44 E

0 – 39 F

I wish you success

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ECN 205

1 / 50

1. Price floors result in:

A. Equilibrium prices

B. Shortages

C. Surpluses

D. Reduced supply

2 / 50

2. Producer surplus measures:

A. Losses below the demand curve

B. Gains above the supply curve up to the price

C. Revenue minus production costs

D. The total market surplus

3 / 50

3. The saving function shows:

A. The relationship between income and savings

B. The total demand for goods

C. Revenue trends in the economy

D. The cost of producing goods

4 / 50

4. A linear demand curve shows:

A. Constant elasticity

B. Varying elasticity

C. Inelastic demand only

D. Perfect elasticity

5 / 50

5. Consumer surplus is the area:

A. Above the supply curve

B. Above the equilibrium price

C. Outside the demand curve

D. Below the demand curve and above the price

6 / 50

6. In the Lagrange method, the multiplier represents:

A. The optimal quantity

B. Market equilibrium

C. The rate of change in the objective function

D. Total cost

7 / 50

7. The law of demand states that

A. Demand increases with price

B. Demand decreases as price increases

C. Demand is unrelated to price

D. Demand remains constant

8 / 50

8. Indifference curves are:

A. Downward sloping and convex to the origin

B. Upward sloping and concave

C. Constant for all preferences

D. Parallel to each other

9 / 50

9. The marginal utility of a good is the

A. Additional satisfaction from consuming one more unit

B. Revenue from selling additional units

C. Total satisfaction derived from all units consumed

D. Cost of producing one unit

10 / 50

10. A demand curve typically:

A. Shifts unpredictably

B. Remains constant

C. Slopes downwards

D. Slopes upwards

11 / 50

11. Substitution effect occurs when

A. Prices of substitutes remain unchanged

B. Buyers switch to cheaper alternatives

C. Demand remains unaffected by price

D. Sellers increase supply

12 / 50

12. Lagrange multipliers are used to:

A. Optimize under constraints

B. Measure consumer surplus

C. Analyze market equilibrium

D. Solve unconstrained problems

13 / 50

13. A linear demand curve shows

A. Perfect elasticity

B. Varying elasticity

C. Constant elasticity

D. Inelastic demand only

14 / 50

14. Taxation typically leads to:

A. An increase in equilibrium price

B. Higher demand for goods

C. A deadweight loss

D. Elimination of producer surplus

15 / 50

15. Marginal Propensity to Save (MPS) is defined as:

A. The total savings in the economy

B. Change in savings due to a change in income

C. Change in income due to a change in savings

D. Average savings per income

16 / 50

16. Returns to scale are constant if:

A. The sum of the exponents in the Cobb-Douglas function equals one

B. Technology is constant

C. Exponents are greater than one

D. Inputs are doubled and output doubles

17 / 50

17. Price elasticity of demand is typically:

A. Negative

B. Infinite

C. Positive

D. Zero

18 / 50

18. Profit is defined as the difference between:

A. Revenue and quantity

B. Revenue and cost

C. Price and cost

D. Supply and demand

19 / 50

19. saddle point in calculus represents

A. A local minimum

B. A point of inflection

C. Neither maximum nor minimum

D. A local maximum

20 / 50

20. Input-output analysis examines:

A. Utility maximization

B. The elasticity of demand

C. Consumer behavior

D. The interaction of various economic sectors

21 / 50

21. A demand function expresses the relationship between:

A. Income and savings

B. Price and quantity demanded

C. Price and utility

D. Supply and cost

22 / 50

22. Isoquants that are right-angled indicate:

A. Increasing returns to scale

B. Variable proportions production

C. Fixed-proportions production

D. Perfect substitutes

23 / 50

23. Excess demand occurs when:

A. Demand exceeds supply

B. Prices are above equilibrium

C. Supply exceeds demand

D. Markets are saturated

24 / 50

24. The function representing revenue in economics is:

A. R = MC × P

B. R = TC × Q

C. R = Q × Q

D. R = P × Q

25 / 50

25. The marginal cost is derived from

A. Total cost divided by quantity

B. Total revenue divided by price

C. Average cost curves

D. The slope of the total cost curve

26 / 50

26. Differential calculus in economics is used to study:

A. Market structures

B. Constant changes

C. Static relationships

D. Marginal analysis

27 / 50

27. The budget constraint equation is primarily used in:

A. Cost minimization problems

B. Input-output analysis

C. Consumer utility maximization

D. Elasticity calculation

28 / 50

28. Elasticity measures:

A. Total revenue

B. Sensitivity of one variable to another

C. Fixed supply trends

D. The absolute change in demand due to price

29 / 50

29. The pioneer in applying mathematics to economics was:

A. Cournot

B. Vilfredo Pareto

C. Alfred Marshall

D. John von Neumann

30 / 50

30. The law of supply indicates that:

A. Higher prices increase supply

B. Lower prices increase supply

C. Higher prices reduce supply

D. Prices do not affect supply

31 / 50

31. Linear programming is a technique used for:

A. Historical analysis

B. Profit estimation

C. Constrained optimization

D. Market forecasting

32 / 50

32. An indifference curve represents:

A. Profit maximization levels

B. Combinations of goods providing equal utility

C. Supply and demand equilibrium

D. Total revenue

33 / 50

33. Consumption function refers to the relationship between:

A. Supply and demand

B. Price and supply

C. Cost and revenue

D. Income and consumption

34 / 50

34. A perfectly competitive market involves:

A. Homogeneous goods

B. A single seller

C. Price-making sellers

D. A government monopoly

35 / 50

35. Cobb-Douglas production function represents:

A. A linear relationship between inputs and outputs

B. Constant returns to scale only

C. Fixed inputs and outputs

D. A specific form of a production function

36 / 50

36. A utility function represents:

A. Market supply schedules

B. Consumer preferences and satisfaction

C. Revenue generated by producers

D. Costs of production

37 / 50

37. Utility functions are used to measure:

A. Consumer satisfaction

B. Cost reductions

C. Profit margins

D. Production levels

38 / 50

38. Price ceilings lead to:

A. Shortages

B. Excess supply

C. Revenue increases

D. Market surpluses

39 / 50

39. Elasticity of demand can be defined as:

A. Responsiveness of demand to price changes

B. The slope of the supply curve

C. Revenue divided by cost

D. Constant consumer behavior

40 / 50

40. The degree of homogeneity in production function indicates:

A. The efficiency of labor

B. The level of input required

C. The elasticity of substitution

D. The type of returns to scale

41 / 50

41. Market supply refers to:

A. Buyers' willingness to purchase at different prices

B. Goods produced without cost consideration

C. Supply affected only by income changes

D. Total goods sellers are willing to provide at various prices

42 / 50

42. Marginal revenue is defined as:

A. Total cost minus profit

B. Revenue per unit sold

C. Total revenue divided by quantity

D. The slope of the total revenue curve

43 / 50

43. Total revenue is maximized when:

A. Marginal revenue equals zero

B. Price elasticity equals zero

C. Marginal cost is minimized

D. Average cost equals price

44 / 50

44. The marginal utility of a commodity is:

A. The total utility of consuming all units

B. The average utility per unit

C. Always constant

D. The change in total utility from consuming one more unit

45 / 50

45. The slope of an isoquant curve represents:

A. Revenue generation

B. Profit maximization

C. Marginal cost

D. Marginal rate of technical substitution

46 / 50

46. The market equilibrium price is determined when:

A. Buyers control the market

B. Government imposes price controls

C. Quantity demanded equals quantity supplied

D. Sellers maximize profits

47 / 50

47. The income effect is seen when

A. Demand increases despite a price hike

B. Sellers reduce production costs

C. Consumers switch to higher-priced goods

D. Consumers feel wealthier due to a price decrease

48 / 50

48. Mathematical economics primarily uses:

A. Literary methods

B. Philosophical arguments

C. Computational methods

D. Historical analysis

49 / 50

49. Buyers and sellers in a perfectly competitive market are known as:

A. Price takers

B. Arbitrators

C. Price controllers

D. Price makers

50 / 50

50. Marginal cost is calculated as:

A. The first derivative of the cost function

B. The difference between fixed and variable costs

C. Average cost of all units

D. Total cost divided by quantity

Your score is

The average score is 46%

ECN 205 CBT PRACTICE

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