Sample Quiz 1 Introduction to Microeconomics (ECO 101)

Think before you write. Relate your answers to the concepts of Ch. 1 & 2.

1.1 Let us imagine that the government of Bangladesh has decided to build a new bridge. What
could be the opportunity cost of this decision?
1.2 Give a few examples of the resources (inputs) the government will need to build the bridge? Is
the government a resource (input) in this situation? Explain briefly.

2. Traffic jams occur due to scarcity. Do you agree or disagree? Explain briefly.

3. Explain how the government may use incentives and negative incentives to tackle the problem of
traffic jams.

4. During course advising in NSU we face the problem of scarcity. Explain why the problem of
scarcity occurs (happens)? Which effects of scarcity do we have to face? Explain each effect in detail.

5. Explain using your own example how a change in opportunity cost can affect human behaviour.

6.1 Let us consider two-variables (factors): i) the time a student spends on leisure activities (TV,
internet, etc) and ii) the CGPA of the student. These two variables are likely to be:

a) positively related b) negatively related d) independent (not related)

6.2 Sketch (roughly draw) a graph to represent the relationship between the above two variables.

6.3 In the study of the two variables above do you need to assume ceteris paribus. Why or why not?
Explain briefly.

7. Bangladesh Government wants to make the Rampal Power Plant because they think the ________
and some people are protesting the construction of the power plant because they think _________.

a) benefit > cost ; benefit < cost b) benefit < cost ; benefit > cost

c) benefit > cost ; benefit > cost d) None of the above

 Sample Quiz 1 Introduction to Microeconomics (ECO 101)

8. A village can only produce lamps and carpets. The following table is given:

Number of Lamps (per month) Number of Carpets (per month)

1000 0

800 100

500 200

0 300

Is the production in the village affected by the Law of Increasing Opportunity Costs? Explain using
the table above.

9. Use a PPF to illustrate and discuss the concept of productive efficiency.