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