EXERCISE 1: INTRODUCTION & THEORY OF DEMAND

1. Which of the following is concerned with microeconomics?

a) The unemployment rate decreases by 30 percent.

b) In 1994, the national income of a country is RM 23,400 millions.
c) The price of chicken increases significantly during Hari Raya season.
d) The economic growth of the country is expected to be 8 percent in 1995.

2. _______ is the concept of brotherhood found in Muslim society.

a) Khilafah
b) Tazkiyyah
c) Ukhwah
d) Rubbubiyah

3. The money payment made to owners of land, labor, capital, and entrepreneur are

a) interest, wages, rent, and profits respectively.

b) rent, profits, wages, and interest respectively.
c) rent, wages, interest, and profits respectively.
d) rent, wages, profits, and interest respectively.

4. If demand for good X decreases when income increases, good X must be

a) a normal good
b) an inferior good
c) a substitute good
d) a complementary good

5. Ceteris paribus, an increase in the price of car will cause the demand curve for petrol

a) to shift to the right

b) to shift to the left
c) remain constant
d) to be steeper

6. The goods which is prohibited in Islam is

a) Dharuriyyat
b) Hajjiyat
c) Kamaliat
d) Tarafiat

7. Microeconomics focuses on

a) issues such as economic growth, inflation and unemployment.

b) the working of the whole economy.
c) factors that affect the total demand for goods and services.
d) the behavior of individuals and organizations towards scarce resources.
8. A public good is defined as

a) any good that is consumed by everyone whether they pay or not. :

b) any good that is produced by the public sector.
c) any good that is sold to the public in the market.
d) any good that is produced in a socialist economy.

9. A movement along the production possibilities curve implies that

a) production has increased.

b) another combination of goods is now produced.
c) more resources are now available.
d) technology has improved.

10. An economy in which individual people and firms pursue their own self-interests without
any central direction or regulation is

a) a private sector economy

b) a laissez-faire economy
c) a command economy
d) a mixed economy

11. The law of demand implies that

a) as price rises, quantity demanded increases

b) as price falls, quantity demanded increases
c) as price falls, demand increases
d) as price rises, demand decreases

12. In an Islamic Economic System, its philosophical foundation is based on

a) the tauhidic concept

b) maximisation of welfare
c) equal distribution of income and wealth
d) all of the above

13. Which of the following reflect the priority of goods from the Islamic point of view?

a) Hajiyyah, Kamaliyyah, Daruriyyah

b) Daruriyyah, Hajiyyah, Tarafiyyah
c) Kamaliyyah, Hajiyyah, Daruriyyah
d) Daruriyyah, Hajiyyah, Kamaliyyah

14. Which of the following economic system is associated with government ownership of
resources and central planning?

a) Socialistic economic system

b) Capitalistic economic system
c) Mixed economic system
d) Islamic economic system
15. Which of the following is not a characteristic of pure capitalism?

a) large number of firms and buyers.

b) freedom of enterprise and choice,
c) competition in product and resource markets.
d) government determination of economic goals.

JAWAPAN:

1. C 6. D 11. B
2. C 7. D 12. A
3. C 8. A 13. D
4. B 9. B 14. A
5. B 10. B 15. D