San Beda College Alabang

Business Administration and Entrepreneurship

Midterms Exam
Name:
Year and Section:
Date:
Course Subject:

I Multiple Choice. Choose the letter of the best answer. Write the letter “E” if the answer is not
in the choices
1. Since buyers are able and willing to purchase more at lower prices and less at higher prices,
this suggests
a. an upward sloping supply curve c. a downward sloping demand curve
b. a downward sloping demand curve d. an upward sloping demand curve

2. Assuming all things equal, when a business group diverts property management from food
processing, this happens to the food processing sector.
a. supply curve shifts to the right c. demand curve shifts to the right
b. supply curve shifts to the left d. demand curve shifts to the left

3. Assuming all things equal, when students prefer laptop to desktop computer. What happens
to the desktop computer?
a. supply curve shifts to the right c. demand curve shifts to the right
b. supply curve shifts to the left d. demand curve shifts to the left

4. Assuming all things equal, when tariffs are imposed on Turkish flour used for pan de sal. What
happens to pan de sal
a. supply curve shifts to the right c. demand curve shifts to the right
b. supply curve shifts to the left d. demand curve shifts to the left

5. Assuming all things equal, when students prefer laptop to desktop computer. What happens
to the laptop computer?
a. supply curve shifts to the right c. demand curve shifts to the right
b. supply curve shifts to the left d. demand curve shifts to the left

6. Producer rationality suggests

a. an upward sloping supply curve c. a downward sloping demand curve
b. a downward sloping demand curve d. an upward sloping demand curve
7. Assuming all things equal, organic vegetables producer are more visible during weekly
farmers’ market
a. supply curve shifts to the right c. demand curve shifts to the right
b. supply curve shifts to the left d. demand curve shifts to the left
8. Assuming all things equal, OFW remittances decline due to changing host country rules and
policies.
a. supply curve shifts to the right c. demand curve shifts to the right
b. supply curve shifts to the left d. demand curve shifts to the left

9. Assuming all things equal, computer technology is improved that helps all levels of production
a. supply curve shifts to the right c. demand curve shifts to the right
b. supply curve shifts to the left d. demand curve shifts to the left

10. When the prices of coffee decreases, assuming all things equal, this happens to its
compliment; creamer.
a. supply curve shifts to the right c. demand curve shifts to the right
b. supply curve shifts to the left d. demand curve shifts to the left

11. Assuming all things equal, transport prices of rice from the provinces go up due to diesel
cost. What happens to the rice?
a. supply curve shifts to the right c. demand curve shifts to the right
b. supply curve shifts to the left d. demand curve shifts to the left

12. Assuming all things equal, prices of fish go up and the price of chicken remains the same.
a. demand for fish shifts to the right c. demand for chicken shifts to the right
b. demand for fish shifts to the left d. demand for chicken shifts to the left

13. When quantity demanded changes by a larger percentage compared to prices. There is said
to be:
a. relatively inelastic demand c. perfectly inelastic demand
b. relatively elastic demand d. perfectly elastic demand

14. When quantity demanded changes by a smaller percentage compared to prices. There is said
to be:
a. relatively inelastic demand c. perfectly inelastic demand
b. relatively elastic demand d. perfectly elastic demand

15. When quantity demanded does not change at all compared to prices. There is said to be:
a. relatively inelastic demand c. perfectly inelastic demand
b. relatively elastic demand d. perfectly elastic demand
16. When demand shifts to the left and supply remains unchanged
a. equilibrium price and quantity increases
b. equilibrium price and quantity decreases
c. equilibrium price increases and quantity decreases
d. equilibrium price decreases and quantity increases

17. When supply shifts to the right and demand remains unchanged
a. equilibrium price and quantity increases
b. equilibrium price and quantity decreases
c. equilibrium price increases and quantity decreases
d. equilibrium price decreases and quantity increases

17. When demand shifts to the right and supply remains unchanged
a. equilibrium price and quantity increases
b. equilibrium price and quantity decreases
c. equilibrium price increases and quantity decreases
d. equilibrium price decreases and quantity increases

18. When supply shifts to the left and demand remains unchanged
a. equilibrium price and quantity increases
b. equilibrium price and quantity decreases
c. equilibrium price increases and quantity decreases
d. equilibrium price decreases and quantity increases

19. When demand shifts to the left and supply remains unchanged
a. equilibrium price and quantity increases
b. equilibrium price and quantity decreases
c. equilibrium price increases and quantity decreases
d. equilibrium price decreases and quantity increases

20. There was an announcement by CHED that face-to-face classes will be back in January. What
will happen to the equilibrium price of school supplies?
a. equilibrium price and quantity increases
b. equilibrium price and quantity decreases
c. equilibrium price increases and quantity decreases
d. equilibrium price decreases and quantity increases
21. A new commercial building was built, and another salon opened its doors for business. What
will happen to the equilibrium price of salons?
a. equilibrium price and quantity increases
b. equilibrium price and quantity decreases
c. equilibrium price increases and quantity decreases
d. equilibrium price decreases and quantity increases

22. Government intervention on tobacco businesses which increases the tax imposed on the
industry. What will happen to equilibrium price of the tobacco industry?
a. equilibrium price and quantity increases
b. equilibrium price and quantity decreases
c. equilibrium price increases and quantity decreases
d. equilibrium price decreases and quantity increases

23. Philippines is experiencing a nationwide drought, which greatly affected rice plantations.
What will happen to the equilibrium price of rice?
a. equilibrium price and quantity increases
b. equilibrium price and quantity decreases
c. equilibrium price increases and quantity decreases
d. equilibrium price decreases and quantity increases

24. Philippines is experiencing a nationwide drought, which greatly affected rice plantations.
What will happen to the equilibrium price of rice?
a. equilibrium price and quantity increases
b. equilibrium price and quantity decreases
c. equilibrium price increases and quantity decreases
d. equilibrium price decreases and quantity increases

25. A lot of factories has been shutting down its operation in a certain number of provinces.
What will happen to the equilibrium price of goods in those provinces?
a. equilibrium price and quantity increases
b. equilibrium price and quantity decreases
c. equilibrium price increases and quantity decreases
d. equilibrium price decreases and quantity increases

26. A lot of factories has been shutting down its operation in a certain number of provinces.
What will happen to the equilibrium price of goods in those provinces?
a. equilibrium price and quantity increases
b. equilibrium price and quantity decreases
c. equilibrium price increases and quantity decreases
d. equilibrium price decreases and quantity increases
26. A spread of cow disease has been announce by the WHO. What will happen to the
equilibrium price beef?
a. equilibrium price and quantity increases
b. equilibrium price and quantity decreases
c. equilibrium price increases and quantity decreases
d. equilibrium price decreases and quantity increases

27. A spread of mad cow disease has been announce by the WHO. What will happen to the
equilibrium price of beef?
a. equilibrium price and quantity increases
b. equilibrium price and quantity decreases
c. equilibrium price increases and quantity decreases
d. equilibrium price decreases and quantity increases

28. An increase in the price of chicken nuggets. What will happen to the equilibrium price of
chicken nuggets?
a. equilibrium price and quantity increases
b. equilibrium price and quantity decreases
c. equilibrium price increases and quantity decreases
d. equilibrium price decreases and quantity increases

29. An increase in the price of Tennis Racket. What will happen to the equilibrium price of
Tennis Balls?
a. equilibrium price and quantity increases
b. equilibrium price and quantity decreases
c. equilibrium price increases and quantity decreases
d. equilibrium price decreases and quantity increases

30. An increase in the price of Tennis Racket. What will happen to the equilibrium price of Tennis
Balls?
a. equilibrium price and quantity increases
b. equilibrium price and quantity decreases
c. equilibrium price increases and quantity decreases
d. equilibrium price decreases and quantity increases

31. A movement along the supply curve is caused by

a. technology change
b. future expectations
c. price change
d. government grants
32. Producer’s rationality refers to
a. cost reduction
b. loss minimization
c. profit maximization
d. outsourcing

33. A shift in the demand curve is caused by

a. price increase
b. price decrease
c. price changes
d. non price factors

34. A Latin phrase essentially meaning "all else equal", which is used in economics to emphasize
the idea that the only changes you should be thinking about are the ones that are explicitly
described
a. Wingardium Leviosa
b. Negotorium Gestio
c. Ceteris Plombus
d. E pluribus anus

35. A price above equilibrium denotes:

a. hoarding
b. surplus
c. shortage
d. recession

36. Which of the following is not part of the four economic resources
a. land
b. labor
c. capital
d. entrepreneurial ability

37. Which of the following is not part of the three important questions of economics?
a. Who will produce? c. Why will we produce?
b. What will we produce? d. Who will receive the goods?

38. Company A wants to improve their production level with their limited manpower and limited
resources. Which analytical tool should they use to help them in their analysis?
a. Constrained Optimization c. Equilibrium Analysis
b. Comparative Statics d. Objective Function
39. Company B wants to know the effect of their new system to the production level of their
factory. Which analytical tool should they use to help them in their analysis?
a. Constrained Optimization c. Equilibrium Analysis
b. Comparative Statics d. Objective Function

40. An increase in the taxes of tobacco will lead to a decrease in profits of the tobacco industry is
an example of
a. Positive Statement
b. Normative Statement

41. Unemployment is more important aspect of economy than inflation

a. Positive Statement
b. Normative Statement

42. Wearing a mask will lessen the spread of the coronavirus

a. Positive Statement
b. Normative Statement

43. Higher interest rates will increase house prices

a. Positive Statement
b. Normative Statement

44. Women should be provided higher school loans than men

a. Positive Statement
b. Normative Statement

45. Sir Casti is the most handsome professor in San Beda College Alabang is an example of
a. Positive Statement
b. Very Positive Statement
c. Very Very positive Statement
d. All of the above
II Problem Solving. BOX YOUR FINAL ANSWER.

1. Use the following data to answer the questions

Quantity Price Quantity Price
2100 83 2800 88
1300 98 2000 81

a. Market equilibrium (5 points)

b. Quantity at market equilibrium (5 points)
c. Draw the graph. Label the Supply, Demand, and Market Equilibrium (5 points)
d. Solve for Qd and Qs if Price is P 77.77 (5 points)

III. Essay. Discuss each concept briefly.

a. What is the importance of opportunity cost in economics? (5 points)

b. Implications of the intercept and negative slope in Quantity Demanded (5 points)
c. Explain the importance of market equilibrium (5 points)

Bonus: (5 points)