Use Instruction A to answer questions number 16 to 24
Instruction A:
Choose the best answer.

16. When demand is inelastic, the price elasticity of demand is ...
a. less than 1, and price and total revenue will move in the same direction.
b. less than 1, and price and total revenue will move in opposite directions.
c. equal to 1, and price and total revenue will move in the same direction.
d. greater than 1, and price and total revenue will move in the same direction.
e. greater than 1, and price and total revenue will move in opposite direction.

17. Indifference curve indicates ...
a. the same amount of budget.
b. the same satisfaction of all consumers.
c. the same satisfaction of a consumers.
d. the same consumption level.
e. the same marginal utility of a consumer.

18. The marginal cost curve is ...
a. downward sloping.
b. upward sloping.
c. U-shaped.
d. horizontal-shaped.
e. intersecting at minimum point of average fixed cost curve.

19. Monopolistic competition differs from perfect competition because in monopolistically competitive markets ...
a. there are barriers to entry.
b. all firms can eventually earn economic profits.
c. each of the sellers offers a somewhat different product.
d. strategic interactions between firms is vitally important.
e. faces a horizontal demand curve at the market clearing price.

20. The following factors affect consumption expenditure, EXCEPT ...
a. market structure.
b. interest rate.
c. income level.
d. government policy to reduce income inequality through tax subsidy.
e. pension fund and social allowance programs.

21. To control inflation rate, the government conducts a fiscal policy which is ...
a. contractionary through increasing tax rate.
b. contractionary through increasing subsidy.
c. contractionary through increasing interest rate.
d. expansionary through increasing subsidy.
e. expansionary through increasing interest rate.

22. Which of the following is NOT included in GDP?
a. Unpaid cleaning and maintenance of houses.
b. Service such as those provided by lawyers.
c. The estimated rental value of owner-occupied housing.
d. Production of foreign citizens living in your country.
e. None of the above is correct.

23. At January 2, 2013, Dunia Company received a year zero-interest-bearing Rp 10,000,000.00 trade note. The market rate for equivalent notes was 8% at that time. Dunia reported this note as a Rp 10,000,000.00 trade note receiveable on its 2013 year-end statement of financial position and Rp 10,000,000.00 as sales revenue for 2013. What effect did this accounting for the note have on Finney’s net incomes for 2013, and 2014?
a. Overstated and overstated.
b. Understated and overstated.
c. Overstated and understated.
d. Understated and no effect.
e. Overstated and no effect.

24. The Full Moon financial statements for the years ended December 31, 2015 contained the following errors. Ending inventory overstatement Rp30,000,000.00, Depreciation expense understatement Rp6,000,000.00, By what amount will 2015 income before income taxes be overstated or understated?
a. Rp36,000,000.00 overstatement.
b. Rp36,000,000.00 understatement.
c. Rp24,000,000.00 overstatement.
d. Rp24,000,000.00 understatement.
e. Rp6,000,000.00 understatement.

Use Instruction B to answer questions number 25 to 27
Instruction B:
Each question consists of 3 parts, i.e. STATEMENT, CAUSE, and REASON that are arranged in sequence.
(A) If the statement is correct, the reason is correct, and both show a cause and effect relationship.
(B) If the statement is correct, the reason is correct, but both do not show a cause and effect relationship.
(C) If the statement is correct and the reason is incorrect.
(D) If the statement is incorrect and the reason is correct.
(E) If the statement and the reason are both incorrect.

25. If the demand for a product decreases, we would expect equilibrium price to increase and equilibrium quantity to decrease
if the supply of a product increases, we would expect equilibrium price to decrease and equilibrium quantity to increase.

26. A monopoly’s marginal cost will be less than the price per unit of its product
a monopoly’s total revenue will always increase when it increases the price of its product.

27. Increasing money supply creates inflation
ff inflation occurs, real income decreases.

Use Instruction C to answer questions number 28 to 30
Instruction C:
(A) If (1), (2), and (3) are correct.
(B) If (1) and (3) are correct.
(C) If (2) and (4) are correct.
(D) If only (4) are correct.
(E) If all of them are correct.

28. The following statement(s) is/are CORRECT with regard to production theory.

(1) Producer equilibrium is attained when the demand curve intersects the supply curve.
(2) If the number of workers increases, ceteris paribus, output level will continuously increase.
(3) Vertical and horizontal axis of isocost measure the cost and the quantity of goods produced.
(4) When the total product reached its maximum level, the marginal product is zero.

29. Which of the following statements regarding a competitive market is (are) false?

(1) By lowering its price below the market price, the firm will benefit from being able to sell more units at the lower price than it could have sold by charging the market price.
(2) If a firm raises its price, the firm may be able to increase its total revenue even though it will sell fewer units.
(3) Because of firm location of product differences, some firms can charge a higher price than other firms and still maintain their sales volume.
(4) Since demand is downward sloping, if a firm increases its level of output, the firm will have to charge a lower price to sell the additional ouput.

30. The factor(s) that determine(s) economic growth of a country are ...

(1) quantity and quality of population.
(2) entrepreneurship.
(3) land and natural resources.
(4) capital goods and technology.
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