IB Econ Test Questions

All groups have posted their questions. I have done a few edits, but I may make more changes. If you have trouble accessing the doc, let me know via email.

Google doc of all the questions:

https://docs.google.com/document/d/1oJAJUiShfoiYS_T2Ij2tyBMN_SPeLFeFoqScnr_EOlI/edit?usp=sharing

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4 thoughts on “IB Econ Test Questions”

  1. 1. What is it called when a market shifts back to equilibrium after a change in supply or demand?
    Price mechanism

    2. What is the term for the maximum benefit of the consumer and producer?
    W) Total surplus
    X) Allocative efficiency
    Y) People’s benefit
    Z) Utilitarianism benefit

    3. What is the defined by the total satisfaction gained by a consumer from paying a lower price than they were prepared to pay?
    Consumer surplus

    4. When we assume that the cost to industry is equal to the cost of society, then what does the supply curve represent?
    W) Law of demand
    X) Law of supply
    Y) Marginal social cost curve (MSC)
    Z) Market clearing price

    5. What is the name for the next best good or service given up when a consumer makes a choice?
    Opportunity cost

  2. When the PED (price elasticity of demand) is between 1 and infinity, what type of elasticity is it?
    Elastic
    Inelastic
    Unit Elastic
    Variable Elastic
    The cost of donuts increase from $0.80 to $1.20 per donut. The amount of donuts demanded goes from 250 to 180. What is the PED?
    1.76
    0.56
    1.44
    0
    Which of the following is NOT a determinant of elasticity of demand
    Number of Substitutes
    Time Period
    Ability to store stock
    Necessity
    Which is NOT a determinant of elasticity of supply?
    Government Intervention
    Ability to store stock
    How much costs rise as output is increased
    Time Period
    What does it mean if the cross elasticity of demand is negative?
    The two goods are complements
    The two goods are substitutes
    The two goods are analogous
    The two goods are unrelated
    There is a rise in price for beef. How would this affect the demand of A) chicken B) cars
    Draw a perfectly inelastic supply curve. Explain what this means.
    Necessity goods have a
    Low income elasticity
    High income elasticity
    No income elasticity
    None of the above

  3. What is the Law of Demand?
    a) A price rise leads to quantity supplied increases, ceterus paribus
    b) The willingness and ability to purchase a good
    c) A price decrease leads to a demand increase, ceterus paribus
    d) The willingness and ability to supply a good

    What are the non-pirce determinants of Demand?
    a) Income, Price of other products, Tastes/prefrences
    b) Income, cost of Factors of production, Expectations,
    c) Income, price of other products, expectations
    d) Tastes/prefrences, government intervention, State of technology

    What would happen to the demand of a Burger King Whopper, if the price of a Big Mac (a substitute) goes up.
    a) There would be a decrease of demand along the curve
    b) There would be an increase of demand along the curve
    c) There would be a shift in the demand curve to the left
    d) There would be a shift in the demand curve to the right

    What is the law of supply?
    a) as the price of a product rises, quantity supplied rises
    b) as the price of a product decreases, quantity supplied rises
    c) as the price of a product rises, quantity supplied decreases
    d) as the price of a product decreases, quantity supplied decreases

    Which of these is not a non-price determinant of supply?
    a) state of technology
    b) geographical chages
    c) cost factors of production
    d) price of other products

    Represent on a supply curve what happens when the price of a hydroflask increases. State whether this is a movement or a shift.

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