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HL - Microeconomics Part I

25 MCQ from 2025 Question Bank Microeconomics Part I(all topics)

DP IB HL Economics Quiz

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1. A footwear company donates a pair of shoes to a person in need for every pair of shoes purchased. The company has expanded its impact beyond shoes and now supports initiatives related to clean water, eyewear, and safe birth services.

This is an example of which alternative business objective?

 

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2.

EC0032

Assuming the market shown in the diagram is allocatively efficient, calculate the consumer surplus.

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3.

EC0038

Which point on the Engel curve above identifies the situation where blankets are a luxury good?

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4. The term default choice'' means:

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5.

EC0136

Which of the following scenarios would most likely cause the change in the diagram above?

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6. Which of the following best describes the concept of signalling in the context of the price mechanism?

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7. Oil has price inelastic supply because

  • I.  It has limited substitutes
  • II.  It takes time to adjust production inputs
  • III.  Production involves a high cost
  • IV.  It is a necessity

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8. In real estate negotiations, the seller's initial asking price influences potential buyers' offers, with those closer to the initial asking price being perceived as more reasonable. As a result, negotiations revolve around that initial asking price, leading to a narrower range of prices.

The above is an example of which bias limiting rational consumer choice?

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9. Which of the following statements are true about the concept of bounded rationality?

  • I.  Consumers maximise utility
  • II.  Consumers satisfice rather than maximise utility
  • III.  Consumers cannot process all information
  • IV.  Consumers have perfect information

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10. What could explain a decrease in demand for used cars?

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11. In the hypothetical country of Smokeland, the government implements high indirect taxes on cigarettes to deter consumption. Strict regulations on advertising and promotion, coupled with public health programs funded by tax revenues, lead to reduced smoking rates and improved public health outcomes.

Which of the following is not a possible outcome of these forms of government intervention?

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12. The following statements are correct except:

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13. A recent news headline stated that people dread swimming in Australian oceans due to shark attacks. This is an example of which bias?

 

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14. Which of the following would shift the supply curve for wheat to the left?

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15. In the market for a good, assume the income of consumers increases by 10 and quantity demanded of the good increases by 5. Calculate the income elasticity of demand (YED), and state the type of good it is.

YED Type of good
A. 0.5 Luxury
B. 0.5 Necessity
C. 2 Normal
D. 2 Inferior

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16.

EC0033

In the diagram above,  identifies all the following except

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17. The price of a product falls from 30 to 25, and as a result, quantity supplied decreases from  to . Calculate the PES and determine whether supply is price-elastic or price-inelastic.

PES values Price-elastic or inelastic?
A. 0.83 price-inelastic
B. 1.20 price-elastic
C. 1.20 price-inelastic
D. 0.83 price-elastic

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18.

EC0133

Assume canned corn is a normal good. The market for canned corn is initially in equilibrium at point X. If demand for corn-based ethanol increases, and incomes fall, what would the new equilibrium be?

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19. Which of the following is not an example of choice architecture?

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20. Identify which of the following are valid reasons why the price elasticity of supply (PES) for primary commodities is generally lower than the PES for manufactured products.

Primary commodities Manufactured products
A. Tend to be necessities Likely to be easier to store
B. Take time to grow/extract Tend to be luxuries
C. Have few substitutes Have many substitutes
D. Take time to grow/extract Likely to be easier to store

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21. Which of the following statements are true?

  • I.  In the long run, all factors of production are variable.
  • II.  The average product curve intercepts the marginal product curve (MP) at the highest point of MP.
  • III.  Marginal Cost = Δq/ΔTC

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22. The 2 sector circular flow of income model shows:

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23.

image

What market that is most likely pictured in the diagram above?

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24. Consumer electronics have price elastic supply because

  • I.  They are durable and can be stored
  • II.  They do not take a long time to produce
  • III.  They have a lot of substitutes
  • IV.  They are luxuries

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25. Assume the price elasticity of demand (PED) for a home cleaning service changes from  to . Which of the following statements explain this change?

  • I  a competing firm increased its operating hours
  • II. a competing firm begins focusing on office cleaning
  • III. incomes of potential customers increase

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