100

NAME : …………………………………………………..…………………………………
REGISTRATION NO.: …………………………….PROGRAMME/CLASS: ……………………

DPB10013 – MICROECONOMICS
END OF CHAPTER 2 (CLO2C)
DECEMBER 2020 SESSION

Instruction: Answer all the questions. Good luck.

1 Which of the following is true about complement goods and substitute goods?

A Part of the substitute goods is a complement goods.

B Part of the complement goods is a substitute goods.
C The cross elasticity of the complement goods are always negative while the cross
elasticity of the substitute goods are always positive.
D The cross -elasticity of the complement good is always positive while the elasticity
Substitute goods are always negative.

2 Which of the following makes the demand for rice more elastic?

A Rising rice prices

B Reduction of rice imports
C Reduction in consumer taste
D Creation of more substitute goods to rice

3 When the price of item X increases from RM4.00 per unit to RM5.00, the quantity demanded
decreases from 20 units to 19 units. This means that the demand for item X is
A elastic
B perfectly elastic
C inelastic
D perfectly inelastic

4 Along the demand curve sloping downward from left to right, is found

A the elasticity of demand and the slope are constant

B the elasticity of demand and its slope change
C the elasticity of demand changes but the slope remains
D the elasticity of demand remains but the slope changes

5 To encourage the development of the local car industry, the government raised the import tax
which caused the price of imported cars to increase by 20%. This increase in import tax has
caused the demand for local cars to increase from 100 000 units to 140 000 units. The elasticity
of cross demand between imported cars and local cars is

A -2.0
B -0.5
C 0.5
D 2.0
 6 Demand for corn is perfectly inelastic. If there is an increase in corn price, then

A demand of corns are constant

B the profits of corn producers increased
C the total income of corn producers declined
D the total income of corn producers increased

7 The cross -elasticity of item X against the price of item Y is –3. If the original quantity of item X
is 100 units, what is the new quantity of item X when the price of item Y increases from RM2.00
per unit to RM24.00 per unit?
A 400 unit
B 600 unit
C 800 unit
D 1200 unit

8 Assume that the reduction in the price of item Y from RM10.00 to RM9.00 causes the quantity
of item X demanded to increase from 100 units to 120 units. What is the value of cross -
elasticity, and what is the relationship between item X and item Y?

Cross elasticity relation

A -2.00 complement
B -2.00 substitute
C 2.00 complement
D 2.00 substitute

9 Harga per unit suatu barang ialah RM5000 dan kuantiti diminta ialah 100 000 unit. Apabila
harga meningkat kepada RM5200, kuantiti diminta jatuh menjadi 90 000 unit. Keanjalan
permintaan barang itu menunjukkan bahawa barang itu adalah

A perfectly elastic
B perfectly inelastic
C inelastic
D elastic

10 The table below shows the relationship between the price of goods X and the quantity
demanded of goods X, Y, and Z.

Price of X Quantity demand (unit)

(RM) X Y Z
4.00 6 4 8
2.00 10 8 4

When the price of item X falls from RM4.00 to RM2.00, then

A cross-elasticity 1, Y is substitute goods.
B cross-elasticity –1, Y is complementary good
C cross-elasticity –2 , Y is complementary good
D cross-elasticity –0.5, Y is complementary good

Prepared By: Checked By: Approved By:

Roshidi Balkhais Akhidah

(ROSHIDI BIN BAKAR) (BALKAIS BINTI JAMALUDDIN) (SITI NOR A’KHIDAH BINTI SAMSUDIN)