Mathematical economics - Quiz
  • 1. Mathematical economics is a branch of economics that utilizes mathematical methods to represent economic theories and analyze economic problems. It combines economic theory with mathematical tools to develop models that can help explain and predict economic behavior. By using mathematical equations and models, economists can quantify relationships between various economic variables and study the impact of different policies and factors on economic outcomes. Mathematical economics has applications in various fields, such as finance, game theory, decision theory, and microeconomics. It allows economists to formulate precise hypotheses, conduct rigorous analysis, and make informed policy recommendations based on data and evidence.

    In economics, what does the term 'equilibrium' refer to?
A) A state of constant change
B) A state of chaos in the market
C) A state where supply equals demand
D) A state of maximum production
  • 2. What does the concept of 'marginal utility' measure?
A) Additional satisfaction gained from consuming one more unit of a good
B) Total quantity of a good consumed
C) Price of the last unit of a good purchased
D) Total satisfaction gained from consuming a good
  • 3. Which economic theory focuses on the relationship between production capacity and inflation?
A) Phillips curve
B) Chicago school of economics
C) Keynesian economics
D) Austrian economics
  • 4. What is the purpose of game theory in economics?
A) To design economic policies
B) To study historical economic data
C) To analyze strategic interactions between rational decision-makers
D) To predict market trends
  • 5. What is the purpose of linear programming in economic analysis?
A) To optimize resource allocation given constraints
B) To graph economic data
C) To analyze historical trends
D) To forecast future demand
  • 6. What is 'opportunity cost' in economics?
A) The value of the best alternative forgone in order to make a particular choice
B) Total cost of production
C) Price of a good in a competitive market
D) Cost of resources used in production
  • 7. Which economic concept is used to measure the responsiveness of quantity demanded to a price change?
A) Elasticity of demand
B) Cross-price elasticity
C) Market equilibrium
D) Income effect
  • 8. What does 'Pareto efficiency' refer to in welfare economics?
A) Maximum total utility for all individuals
B) Elimination of poverty
C) Allocation of resources where no individual can be made better off without making another worse off
D) Equal distribution of wealth
  • 9. In utility theory, what does the 'indifference curve' represent?
A) All combinations of goods that provide the same level of utility to a consumer
B) Curve representing diminishing marginal utility
C) Curve indicating increasing marginal utility
D) Curve showing only one optimal choice
  • 10. Who is credited with coining the term 'statistics'?
A) John Maynard Keynes
B) Sir William Petty
C) Gottfried Achenwall
D) Johann Heinrich von Thünen
  • 11. What was the term used by a group of professors in England for reasoning with figures related to government?
A) Political Arithmetick
B) Mathematical Economics
C) Economic Calculus
D) Statistical Analysis
  • 12. Which economist's work is considered the first example of marginal analysis?
A) Johann Heinrich von Thünen
B) W.S. Jevons
C) Sir William Petty
D) John Maynard Keynes
  • 13. Who presented a paper on the 'general mathematical theory of political economy' in 1862?
A) Gottfried Achenwall
B) Friedrich Hayek
C) Robert Heilbroner
D) W.S. Jevons
  • 14. What did W.S. Jevons declare political economy must be, due to its dealing with quantities?
A) Theoretical
B) Mathematical
C) Qualitative
D) Empirical
  • 15. Who criticized the broad use of mathematical models for human behavior?
A) Gottfried Achenwall, Sir William Petty
B) John Maynard Keynes, Robert Heilbroner, Friedrich Hayek
C) Johann Heinrich von Thünen, W.S. Jevons
D) None of the above
  • 16. What was the main method used in economic analysis before the 19th century?
A) Algebraic means
B) Matrix algebra
C) Game theory
D) Differential calculus
  • 17. Which economist's work was largely ignored by English scholars despite its influence?
A) Sir William Petty
B) Johann Heinrich von Thünen
C) Gottfried Achenwall
D) W.S. Jevons
  • 18. Who are considered the precursors to modern mathematical economics?
A) Augustin Cournot, Léon Walras, and Francis Ysidro Edgeworth
B) Adam Smith, David Ricardo, and John Stuart Mill
C) John Maynard Keynes, Milton Friedman, and Paul Samuelson
D) Karl Marx, Friedrich Hayek, and Joseph Schumpeter
  • 19. How is the market price determined in Cournot's duopoly model?
A) By the total quantity supplied by both sellers
B) By the individual demand curve of each seller
C) By government regulation
D) By the cost of production for each seller
  • 20. What type of equilibrium can Cournot's solution be considered as in modern terms?
A) Walrasian equilibrium
B) Nash equilibrium
C) Kaldor-Hicks efficiency
D) Pareto efficiency
  • 21. What was the initial reception of Cournot's contributions to economics?
A) Neglected for decades
B) Immediately accepted and celebrated
C) Rejected entirely without consideration
D) Implemented in policy immediately
  • 22. How many separate models of exchange did Walras originally present?
A) Three
B) Four
C) Five
D) Two
  • 23. What does Walras' law state about markets reaching equilibrium?
A) Markets cannot reach equilibrium independently
B) Only one market needs to clear for all others to follow
C) All markets must clear simultaneously
D) If n-1 markets cleared, the nth market would clear as well
  • 24. How many markets does Walras use to illustrate his law most easily?
A) Five
B) Two
C) Three
D) Four
  • 25. In which field is Lagrangian duality and convex analysis used daily?
A) Physics
B) Economics
C) Operations research
D) Pure mathematics
  • 26. Which journal was founded in 1933 to promote econometrics?
A) Journal of Political Economy
B) The American Economic Review
C) Quarterly Journal of Economics
D) Econometrica
  • 27. Which theory became more extensively used in economics after Richard Bellman's work on dynamic programming?
A) Functional analysis
B) Fixed-point theory
C) Optimal control theory
D) Variational calculus
  • 28. What does ACE stand for in economic modeling?
A) Applied calculus of economics
B) Automated computational engineering
C) Agent-based computational economics
D) Advanced computational econometrics
  • 29. What institution helped promote the linking of statistical analysis to economic theory in the 1930s and 1940s?
A) Econometric Society
B) National Bureau of Economic Research
C) The Cowles Commission
D) American Economic Association
  • 30. Who worked with John von Neumann on the theory of games?
A) John Harsanyi
B) John Nash
C) Oskar Morgenstern
D) Reinhard Selten
  • 31. When did the field of agent-based computational economics begin to emerge?
A) About the 1990s
B) Late 1970s
C) Mid-2000s
D) Early 1980s
  • 32. How did Kantorovich refer to prices in his models?
A) "Objectively determined valuations"
B) "Optimal functions"
C) "Market equilibria"
D) "Economic variables"
  • 33. Who argued that economic problems which can be quantified should be treated by means of mathematical work?
A) Alfred Marshall
B) Milton Friedman
C) John Maynard Keynes
D) Adam Smith
  • 34. What term is used to describe sets of allocations where no exchanges can make at least one individual better off without making any other worse off?
A) Invisible hand hypothesis
B) Pareto efficient
C) Walrasian equilibrium
D) Comparative statics
  • 35. Who later confirmed Edgeworth's findings about the effect of taxes on prices?
A) Jeremy Bentham
B) Arthur Lyon Bowley
C) Harold Hotelling
D) Edwin Robert Anderson Seligman
  • 36. Who developed the model of input-output analysis in 1936?
A) Wassily Leontief
B) Von Neumann
C) Paul Samuelson
D) Leonid Kantorovich
  • 37. During what event was linear programming used to plan the shipment of supplies to Berlin?
A) Cuban Missile Crisis
B) World War I
C) Cold War
D) Berlin airlift (1948)
  • 38. What type of technologies produce outputs using constant proportions of inputs?
A) Arrow–Debreu models
B) Leontief technologies
C) von Neumann technologies
D) Linear programming techniques
  • 39. What mathematical concept did Paul Samuelson compare to tâtonnement?
A) Pareto efficiency
B) Brouwer's fixed point theorem
C) Von Neumann's equilibrium model
D) Le Chatelier's principle
  • 40. Who first applied differential calculus to analyze microeconomics by treating decisions as attempts to change allocations of goods?
A) Alfred Marshall
B) Paul Samuelson
C) John von Neumann
D) Vilfredo Pareto
  • 41. Who graphically developed the two-person solution to Edgeworth's problem in 1924?
A) Edwin Robert Anderson Seligman
B) Arthur Lyon Bowley
C) Jeremy Bentham
D) Harold Hotelling
  • 42. In what year did John von Neumann and Oskar Morgenstern make significant contributions to game theory?
A) 1965
B) 1994
C) 1951
D) 1944
  • 43. Who is credited with the formal derivation and exposition of the cobweb model?
A) Ragnar Frisch
B) Nicholas Kaldor
C) Trygve Haavelmo
D) Henry L. Moore
  • 44. Which economic theory posits that consumers maximize their utility subject to budget constraints?
A) Input-output economics
B) General equilibrium theory
C) Microeconomics
D) Macroeconomics
  • 45. In which year did Francis Ysidro Edgeworth publish 'Mathematical Psychics: An Essay on the Application of Mathematics to the Moral Sciences'?
A) 1881
B) 1924
C) 1878
D) 1905
  • 46. What did John von Neumann introduce to economic theory in his 1937 model?
A) Functional analytic methods including topology
B) Dynamic programming
C) Convex sets and fixed-point theory
D) Optimal control theory
  • 47. In which year did Nash, Harsanyi, and Selten receive the Nobel Memorial Prize in Economic Sciences?
A) 2001
B) 1985
C) 1994
D) 2010
  • 48. Which concept did von Neumann's model use only nonnegative matrices?
A) Graph theory
B) Differential calculus
C) Convex sets
D) Linear programming
  • 49. What was the nature of Moore's first models of production?
A) Empirical
B) Static
C) Dynamic
D) Probabilistic
  • 50. Who published 'The Probability Approach in Econometrics' in 1944?
A) Ragnar Frisch
B) Trygve Haavelmo
C) Nicholas Kaldor
D) Henry L. Moore
  • 51. What is the primary objective in a nonlinear optimization problem?
A) Minimize f(x)
B) Maximize f(x)
C) Equalize g_i(x)
D) Solve h_j(x)
  • 52. In what year did Henry L. Moore publish his dynamic 'moving equilibrium' model?
A) 1925
B) 1892
C) 1944
D) 1933
  • 53. What has become increasingly important to professionals in economics and finance due to the sophistication of mathematical methods?
A) Statistics
B) Econometrics
C) Programming
D) Mathematics
  • 54. What type of problems often require the use of mathematical tools due to their complexity?
A) Economic problems with many variables
B) Simple arithmetic calculations
C) Qualitative research studies
D) Basic economic theory
  • 55. What concept did Edgeworth adopt from Jeremy Bentham in his economic model?
A) Utilitarianism
B) Felicific calculus
C) Opportunity cost
D) Marginal utility
  • 56. What percentage of articles in top economic journals in 2003 and 2004 lacked both statistical analysis and mathematical expressions?
A) 10%
B) 15%
C) 20%
D) 5.8%
  • 57. What paradigm does ACE fall under?
A) Complex adaptive systems
B) Behavioral finance
C) Classical mechanics
D) Quantum economics
  • 58. Which school of thought criticized the mathematization of economics?
A) Neoclassical schools
B) The Chicago school
C) Keynesian school
D) The Austrian school
  • 59. What did Milton Friedman say about economic model assumptions?
A) Models should not be judged by their predictive performance.
B) Assumptions are irrelevant to model performance.
C) Assumptions should always match reality.
D) 'All assumptions are unrealistic.'
  • 60. Who coined the term 'econometrics'?
A) Trygve Haavelmo
B) Henry L. Moore
C) Nicholas Kaldor
D) Ragnar Frisch
  • 61. What type of functions benefit most from convex duality?
A) Linear functions
B) Polyhedral convex functions
C) Non-convex functions
D) Quadratic functions
  • 62. In which decade was linear programming developed to aid resource allocation in Russia?
A) 1950s
B) 1940s
C) 1930s
D) 1960s
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