School of Economics & Finance
Curtin Business School

ECON5010- Economic Principles
Sample Multiple Choice Question for Practising
1.

An economic theory claims that a rise in petrol prices will cause petrol purchases to fall, ceteris paribus. The phrase ‘ceteris paribus’ means that:
a. other relevant factors like consumer incomes must be held constant.
b. the petrol prices must first be adjusted for inflation.
c.
the theory is widely accepted but cannot be accurately tested.
d. consumers’ need for petrol remains the same regardless of the price.

2.

Which of the following is a statement of positive economics?
a. Government control of rent is a fair way to help poor people afford housing.
b. Government control of rent keeps landlords from charging too much rent.
c.
Government control of rent decreases the number of new apartments constructed.
d. Government control of rent is an injustice.

3. Julie and Tracy both decide to see the same movie when they are given free tickets to the movie. We know that
a. both bear an opportunity cost since they could have done other things instead of see the movie.
b. the cost of going to the movie is greater for the one who had more choices to do other things.
c.
both bear the same opportunity cost since they are doing the same thing.
d. neither bear an opportunity cost because the tickets were free.
4.

Which of the following is not true about a production possibilities curve? The curve:
a. indicates the combinations of goods and services that can be produced with given technology. b. indicates the efficient production points.
c.
indicates the feasible and non-feasible production points.
d. indicates which production point will be chosen.

5.

In the table below, the concept of increasing opportunity costs is represented by the fact that:
a. the quantity of capital goods produced must