Q1-5
Q6-10
Q11-15
Q16-20
Mr. McAllister
100
What is the fundamental economic problem facing all societies?
(a) The achievement of economic growth
(b) The allocation of scarce resources between competing ends
(c) The conflict between economic growth and environmental protection
(d) The depletion of non-renewable resources
(b) The allocation of scarce resources between competing ends
100
A change in the ________ of a good or service leads to a change in ________ that leads to a ________.
(a) supply; demand; change in price
(b) demand; quantity demanded; change in supply
(c) price; quantity demanded; movement along the demand curve
(d) quantity; supply; change in demand
(c) price; quantity demanded; movement along the demand curve
100
A good has unitary price elasticity of demand and at a price of $25 it sells 100,000 units. Which price must the firm charge if it wants to sell 125,000 units of the good?
(a) $24
(b) $20
(c) $16
(d) $12
(b) $20
100
For a given tax imposed on a good, the more the demand curve is inelastic,
(a) the less the tax revenue raised and the greater the deadweight loss.
(b) the less the tax revenue raised and the smaller the deadweight loss.
(c) the greater the tax revenue raised and the greater the deadweight loss.
(d) the greater the tax revenue raised and the smaller the deadweight loss.
(d) the greater the tax revenue raised and the smaller the deadweight loss.
100
Where does the name McAllister come from?
Scotland, double points if you said the highlands of Scotland.
Originally Mac Alasdair (gaelic - Son of Alexander)
200
A food company wishes to diversify its product range. To finance this, it has obtained a $10m loan from a bank to buy land, build and equip a bakery. What would not be classified by an economist as a factor of production?
(a) The $10m loan used to finance the project
(b) The land on which the bakery will be built
(c) The ovens required to bake the bread
(d) The flour used in the making of the bread
(a) The $10m loan used to finance the project
200
The diagram shows a supply curve for chicken. What explains why the supply curve for chicken slopes upwards?
(a) An increase in the demand for chicken will bring about a rise in supply.
(b) Farmers’ productivity rises as the price rises.
(c) Increased production leads to a reduction in costs.
(d) The cost of additional chicken production rises as output increases.
(d) The cost of additional chicken production rises as output increases.
200
A car manufacturer estimates that the price elasticity of supply of its cars is 2.5. What will be the impact of a 10% increase in price?
(a) a 2.5% fall in total revenue
(b) a 25% rise in total revenue
(c) a 2.5% fall in quantity supplied
(d) a 25% rise in quantity supplied
(d) a 25% rise in quantity supplied
200
Suppose the government reduces subsidies paid to dairy farmers. The most likely effect on the price of dairy products would be
(a) an increase as there would be an increase in demand for milk.
(b) an increase as there would be a decrease in the supply of milk.
(c) a decrease as there would be an increase in the supply of milk.
(d) a decrease as there would be a decrease in demand for milk.
(b) an increase as there would be a decrease in the supply of milk.
200
What kind of car does Mr. McAllister drive?
a) 2013 Toyota Kluger
b) 2022 Telsa Model 3
c) 2004 Nissan Pulsar
d) 1943 Porsche Ferdinand
c) 2004 Nissan Pulsar
300
What describes a normative statement?
(a) It answers the question: ‘what actually happened?’
(b) It is testable but incorrect.
(c) It predicts the consequences of alternative actions.
(d) It provides an answer to the question: ‘what should be done?’
(d) It provides an answer to the question: ‘what should be done?’
300
Consider the following demand and supply diagram, for airline tickets from Perth to London. The shift in the supply curve could have been caused by
(a) an increase in the demand for airline tickets to London.
(b) a decrease in the price of airline tickets to London.
(c) a decrease in the cost of aviation fuel.
(d) an increase in the price of airline tickets from Perth to New York.
(c) a decrease in the cost of aviation fuel.
300
The demand for the Floogle smartphone is likely to become more price elastic when
(a) several competitors introduce products that have features similar to the Floogle.
(b) consumers begin to see the Floogle smart phone as a necessity, not a luxury.
(c) the cost of producing the Floogle smart phone falls.
(d) Floogle launches a successful advertising campaign.
(a) several competitors introduce products that have features similar to the Floogle.
300
"Free riding" is a characteristic of which type of good?
(a) A public good
(b) A common resource
(c) A private good
(d) A club good
(b) A common resource
300
What ATAR score did Mr. McAllister get? (closest wins)
Did not do ATAR, bridging course at Murdoch gave equivalent to 70
400
On the diagram opposite, what could cause the curve to shift to JK?
(a) An increase in the employment rate
(b) An increase in demand
(c) An increase in net exports
(d) Net inward migration
(d) Net inward migration
400
If a product became less popular, while at the same time increased costs of production caused the supply of the product to decrease, it can be concluded that, for this product, the
(a) equilibrium price might rise or fall.
(b) equilibrium quantity might rise or fall.
(c) equilibrium price and the equilibrium quantity would rise.
(d) equilibrium price and the equilibrium quantity would fall.
(a) equilibrium price might rise or fall.
400
If the market price is $2.50, what is the consumer surplus on the first ice cream cone?
(a) $0.50
(b) $1.00
(c) $3.50
(d) $9.00
(b) $1.00
400
The fact that Nicholas’s enjoyment of a sunset on Cottesloe beach does not preclude Anthony from enjoying the sunset is an example of
(a) a good that is nonrival.
(b) a good that is excludable.
(c) a private good.
(d) a common resource.
(a) a good that is nonrival.
400
What kind of pet(s) does Mr. McAllister have?
Cats (JoJo, Basil, and fostering Joy)
500
When stating the law of demand for a good, economists use the phrase ‘all other things being equal’. What is not one of these ‘all other things’?
(a) The income of the consumer
(b) The price of other goods
(c) The price of the good
(d) The tastes of the consumer
(c) The price of the good
500
Under which of these conditions is demand considered to be relatively price-elastic?
(a) A 5% decrease in demand reduces price by 10%.
(b) Total revenue on the product increases when price falls.
(c) An increase in price results in greater revenue on the product.
(d) Quantity demanded increases when price falls.
(b) Total revenue on the product increases when price falls.
500
Which of the following are correct when a market is in equilibrium?
i. Consumer surplus is maximised.
ii. Total surplus is maximised.
iii. Resources are efficiently used.
iv. Producer surplus is maximised.
(a) i and ii
(b) i, ii and iii
(c) ii and iii
(d) i, ii, iii, and iv
(c) ii and iii
ii. Total surplus is maximised.
iii. Resources are efficiently used.
500
A tragedy of the commons occurs when a resource is
(a) rival and excludable.
(b) non-rival and excludable.
(c) rival and non-excludable.
(d) non-rival and non-excludable.
(c) rival and non-excludable.
500
What country did Mr. McAllister used to live in?
Germany