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 where supply equals demand
C) A state of maximum production
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) Price of the last unit of a good purchased
C) Total satisfaction gained from consuming a good
D) Total quantity of a good consumed
  • 3. Which economic theory focuses on the relationship between production capacity and inflation?
A) Keynesian economics
B) Chicago school of economics
C) Austrian economics
D) Phillips curve
  • 4. What is the purpose of game theory in economics?
A) To predict market trends
B) To design economic policies
C) To analyze strategic interactions between rational decision-makers
D) To study historical economic data
  • 5. What is the purpose of linear programming in economic analysis?
A) To forecast future demand
B) To optimize resource allocation given constraints
C) To graph economic data
D) To analyze historical trends
  • 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) Total cost of production
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) Income effect
B) Elasticity of demand
C) Cross-price elasticity
D) Market equilibrium
  • 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) 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) Sir William Petty
B) John Maynard Keynes
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) Statistical Analysis
B) Economic Calculus
C) Mathematical Economics
D) Political Arithmetick
  • 12. Which economist's work is considered the first example of marginal analysis?
A) John Maynard Keynes
B) Johann Heinrich von Thünen
C) Sir William Petty
D) W.S. Jevons
  • 13. Who presented a paper on the 'general mathematical theory of political economy' in 1862?
A) Gottfried Achenwall
B) W.S. Jevons
C) Robert Heilbroner
D) Friedrich Hayek
  • 14. What did W.S. Jevons declare political economy must be, due to its dealing with quantities?
A) Mathematical
B) Empirical
C) Qualitative
D) Theoretical
  • 15. Who criticized the broad use of mathematical models for human behavior?
A) Gottfried Achenwall, Sir William Petty
B) None of the above
C) Johann Heinrich von Thünen, W.S. Jevons
D) John Maynard Keynes, Robert Heilbroner, Friedrich Hayek
  • 16. What was the main method used in economic analysis before the 19th century?
A) Game theory
B) Matrix algebra
C) Differential calculus
D) Algebraic means
  • 17. Which economist's work was largely ignored by English scholars despite its influence?
A) W.S. Jevons
B) Sir William Petty
C) Gottfried Achenwall
D) Johann Heinrich von Thünen
  • 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) John Maynard Keynes, Milton Friedman, and Paul Samuelson
D) Augustin Cournot, Léon Walras, and Francis Ysidro Edgeworth
  • 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) Pareto efficiency
B) Walrasian equilibrium
C) Nash equilibrium
D) Kaldor-Hicks efficiency
  • 21. What was the initial reception of Cournot's contributions to economics?
A) Implemented in policy immediately
B) Immediately accepted and celebrated
C) Neglected for decades
D) Rejected entirely without consideration
  • 22. How many separate models of exchange did Walras originally present?
A) Three
B) Five
C) Two
D) Four
  • 23. What does Walras' law state about markets reaching equilibrium?
A) Only one market needs to clear for all others to follow
B) All markets must clear simultaneously
C) If n-1 markets cleared, the nth market would clear as well
D) Markets cannot reach equilibrium independently
  • 24. How many markets does Walras use to illustrate his law most easily?
A) Four
B) Three
C) Five
D) Two
  • 25. In which field is Lagrangian duality and convex analysis used daily?
A) Operations research
B) Pure mathematics
C) Economics
D) Physics
  • 26. Which journal was founded in 1933 to promote econometrics?
A) The American Economic Review
B) Quarterly Journal of Economics
C) Journal of Political Economy
D) Econometrica
  • 27. Which theory became more extensively used in economics after Richard Bellman's work on dynamic programming?
A) Variational calculus
B) Functional analysis
C) Fixed-point theory
D) Optimal control theory
  • 28. What does ACE stand for in economic modeling?
A) Advanced computational econometrics
B) Applied calculus of economics
C) Automated computational engineering
D) Agent-based computational 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) Reinhard Selten
B) John Harsanyi
C) John Nash
D) Oskar Morgenstern
  • 31. When did the field of agent-based computational economics begin to emerge?
A) Early 1980s
B) About the 1990s
C) Mid-2000s
D) Late 1970s
  • 32. How did Kantorovich refer to prices in his models?
A) "Objectively determined valuations"
B) "Market equilibria"
C) "Economic variables"
D) "Optimal functions"
  • 33. Who argued that economic problems which can be quantified should be treated by means of mathematical work?
A) John Maynard Keynes
B) Alfred Marshall
C) Milton Friedman
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) Pareto efficient
B) Invisible hand hypothesis
C) Walrasian equilibrium
D) Comparative statics
  • 35. Who later confirmed Edgeworth's findings about the effect of taxes on prices?
A) Harold Hotelling
B) Edwin Robert Anderson Seligman
C) Arthur Lyon Bowley
D) Jeremy Bentham
  • 36. Who developed the model of input-output analysis in 1936?
A) Wassily Leontief
B) Paul Samuelson
C) Von Neumann
D) Leonid Kantorovich
  • 37. During what event was linear programming used to plan the shipment of supplies to Berlin?
A) Berlin airlift (1948)
B) Cold War
C) Cuban Missile Crisis
D) World War I
  • 38. What type of technologies produce outputs using constant proportions of inputs?
A) von Neumann technologies
B) Arrow–Debreu models
C) Linear programming techniques
D) Leontief technologies
  • 39. What mathematical concept did Paul Samuelson compare to tâtonnement?
A) Von Neumann's equilibrium model
B) Pareto efficiency
C) Le Chatelier's principle
D) Brouwer's fixed point theorem
  • 40. Who first applied differential calculus to analyze microeconomics by treating decisions as attempts to change allocations of goods?
A) Paul Samuelson
B) John von Neumann
C) Vilfredo Pareto
D) Alfred Marshall
  • 41. Who graphically developed the two-person solution to Edgeworth's problem in 1924?
A) Arthur Lyon Bowley
B) Harold Hotelling
C) Edwin Robert Anderson Seligman
D) Jeremy Bentham
  • 42. In what year did John von Neumann and Oskar Morgenstern make significant contributions to game theory?
A) 1994
B) 1944
C) 1951
D) 1965
  • 43. Who is credited with the formal derivation and exposition of the cobweb model?
A) Henry L. Moore
B) Ragnar Frisch
C) Trygve Haavelmo
D) Nicholas Kaldor
  • 44. Which economic theory posits that consumers maximize their utility subject to budget constraints?
A) General equilibrium theory
B) Microeconomics
C) Input-output economics
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) 1905
B) 1924
C) 1881
D) 1878
  • 46. What did John von Neumann introduce to economic theory in his 1937 model?
A) Dynamic programming
B) Convex sets and fixed-point theory
C) Functional analytic methods including topology
D) Optimal control theory
  • 47. In which year did Nash, Harsanyi, and Selten receive the Nobel Memorial Prize in Economic Sciences?
A) 1985
B) 2010
C) 2001
D) 1994
  • 48. Which concept did von Neumann's model use only nonnegative matrices?
A) Linear programming
B) Graph theory
C) Differential calculus
D) Convex sets
  • 49. What was the nature of Moore's first models of production?
A) Empirical
B) Dynamic
C) Static
D) Probabilistic
  • 50. Who published 'The Probability Approach in Econometrics' in 1944?
A) Henry L. Moore
B) Ragnar Frisch
C) Trygve Haavelmo
D) Nicholas Kaldor
  • 51. What is the primary objective in a nonlinear optimization problem?
A) Solve h_j(x)
B) Maximize f(x)
C) Minimize f(x)
D) Equalize g_i(x)
  • 52. In what year did Henry L. Moore publish his dynamic 'moving equilibrium' model?
A) 1925
B) 1944
C) 1892
D) 1933
  • 53. What has become increasingly important to professionals in economics and finance due to the sophistication of mathematical methods?
A) Econometrics
B) Mathematics
C) Programming
D) Statistics
  • 54. What type of problems often require the use of mathematical tools due to their complexity?
A) Qualitative research studies
B) Basic economic theory
C) Simple arithmetic calculations
D) Economic problems with many variables
  • 55. What concept did Edgeworth adopt from Jeremy Bentham in his economic model?
A) Utilitarianism
B) Marginal utility
C) Felicific calculus
D) Opportunity cost
  • 56. What percentage of articles in top economic journals in 2003 and 2004 lacked both statistical analysis and mathematical expressions?
A) 20%
B) 10%
C) 15%
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) Keynesian school
B) Neoclassical schools
C) The Chicago school
D) The Austrian school
  • 59. What did Milton Friedman say about economic model assumptions?
A) Assumptions are irrelevant to model performance.
B) Assumptions should always match reality.
C) Models should not be judged by their predictive performance.
D) 'All assumptions are unrealistic.'
  • 60. Who coined the term 'econometrics'?
A) Henry L. Moore
B) Nicholas Kaldor
C) Trygve Haavelmo
D) Ragnar Frisch
  • 61. What type of functions benefit most from convex duality?
A) Linear functions
B) Quadratic functions
C) Polyhedral convex functions
D) Non-convex functions
  • 62. In which decade was linear programming developed to aid resource allocation in Russia?
A) 1950s
B) 1960s
C) 1930s
D) 1940s
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