0311-212 Midterm Solved Questions & Study Guide (Summer 2026)

0311-212 Microeconomics Midterm Exam Solved Questions — Summer 2026 (DIU BBA)

Introduction

Microeconomics (Course Code: 0311-212) is a foundational course in the BBA program at Daffodil International University (DIU), designed to help students understand how individuals, businesses, and governments make decisions under conditions of scarcity. This Summer 2026 Midterm Exam tests core concepts such as the Production Possibilities Frontier (PPF), demand and supply analysis, market equilibrium, and price elasticity—topics that are not only critical for academic success but also for real-world business applications.

For DIU BBA students, practicing past exam questions is one of the most effective ways to prepare. Solving these questions helps reinforce theoretical knowledge, improves problem-solving speed, and familiarizes students with the exam format. In this guide, we provide detailed, step-by-step solutions to the Summer 2026 Midterm questions, ensuring you grasp the underlying concepts while optimizing your study time. Whether you're revising for the midterm or building a strong foundation for future courses like Managerial Economics (0311-313), this resource is tailored to your needs.

Exam Overview & Mark Distribution

The 0311-212 Microeconomics Midterm (Summer 2026) consists of three questions, covering CLOs 1, 2, and 3 at varying cognitive levels (Level 2 to Level 4). The total marks for this exam are 20, distributed as follows:

• Question 1: 5 marks (Explanation of PPF with numerical examples)
• Question 2 (a & b): 10 marks (Demand-supply analysis and market equilibrium shifts)
• Question 3 (a & b): 10 marks (Market equilibrium and business decision analysis)

Solved Questions

Question 1: "Economics deals with the relationship between ends and scarce means which have alternative uses" – Explain and justify this statement with numerical examples through Production Possibilities Frontier (PPF).

(5 marks | CLO 1, Level 2)

To answer this question, we’ll break it down into key steps:

1. Define Scarcity and Alternative Uses:

- Economics studies how societies allocate scarce resources (e.g., labor, capital, land) to satisfy unlimited wants.

- Resources have alternative uses—for example, land can be used for agriculture or housing.

1. Introduce the PPF:

- The Production Possibilities Frontier (PPF) is a graphical representation of the maximum output combinations an economy can produce using its available resources.

- It illustrates trade-offs (opportunity costs) when resources are reallocated.

1. Construct a Numerical Example:

- Suppose an economy produces only wheat (W) and cloth (C).

- With full resource utilization, possible combinations are:

- A: 0W, 100C

- B: 20W, 90C

- C: 40W, 70C

- D: 60W, 40C

- E: 80W, 0C

1. Plot the PPF:

- The PPF is a concave curve (due to increasing opportunity costs).

- Moving from A to B, the economy sacrifices 10C to produce 20W (opportunity cost = 0.5C per W).

- Moving from D to E, the opportunity cost rises to 2C per W (resources are less suited for wheat production).

1. Justify the Statement:

- The PPF demonstrates that scarce resources (ends) must be allocated efficiently to produce goods (means).

- The trade-off between wheat and cloth shows alternative uses of the same resources.

- Conclusion: Economics helps societies make optimal choices under scarcity, as illustrated by the PPF.

Final Answer:

The statement highlights that economics studies how societies allocate limited resources to fulfill unlimited wants. The PPF visually represents this by showing trade-offs (e.g., producing more wheat requires sacrificing cloth). For example, if an economy moves from producing 20W, 90C to 40W, 70C, it sacrifices 20C to gain 20W, demonstrating scarcity and alternative uses of resources.

Question 2 (a): A telecommunications company reduces the price of its mobile data packages by 30%. Following the price reduction, smartphone sales increase significantly. Analyze the relationship between smartphone sales and mobile data price. Explain why smartphone demand increased after the reduction in data package prices. How would the demand curve for smartphones be affected by this change?

(6 marks | CLO 3, Level 4)

1. Identify the Relationship:

- Smartphones and mobile data are complementary goods—they are used together.

- When the price of a complement (mobile data) falls, the demand for the other good (smartphones) increases.

1. Explain the Demand Increase:

- A 30% price cut in mobile data makes it cheaper to use smartphones, increasing consumer purchasing power.

- Consumers who previously avoided smartphones