HBX-Economics Exam | Verified Exam Questions and Answers | Latest
Updated Study Material 2026
Question:
Which of the following events would, all else equal, cause a rightward shift of the demand curve
for yachts? Select all that apply.
Answer:
A decrease in the price of
yachts
Question:
A change in the price of yachts would not shift the demand curve for yachts. Price changes only
affect quantity demanded, not overall demand.
An increase in household income
is correct
An increase in income would allow more households to be able to afford yachts, shifting the
overall demand for yachts at any given price to the right.
The elimination of a regulation, which had prevented boats from sailing on a particular series of
lakes
is correct
The elimination of a regulation on boats would increase the demand for yachts to sail in
previously forbidden waters.
Your toy company is looking into launching a new line of dolls and action figures but is unsure if
kids these days still actually play with them. As part of your market research, you send out a
survey to 1000 households that have purchased toys in the last five years. You also decide to run
two focus groups: one group of children ages 4-16 and one group of parents.
Which of the following questions asked in a survey or focus group would be unbiased and allow
you to gain reliable information? Select all that apply.
Answer:
A survey
question asking households, "How much money per month do you typically spend on your
children's happiness?"
Question:
This question is too broad and could be biased. For example, some parents will likely overstate
the amount they spend on their children to seem like better parents.
, figures?"
time they spend playing with toys. It might also be the case that children lie about which toys
they use and how often.
A survey question asking households, "What fraction/percentage of income do you estimate that
your family spends on entertainment in a given month?"
is correct
This question seems reasonable and could be useful to estimate potential market size.
A focus group question asking parents, "With which types of toys do your children typically
play?"
is incorrect
This question could be biased. Parents that work during the day might not know what kinds of
toys that their kids like to play with. It might also be that parents would want their children to
play with more educational toys than they actually do.
An anonymous survey question asking children, "what's your favorite toy and why do you like to
play with it?
is correct
This question is likely to evoke a truthful response and allow your company see some common
features of toys that kids would value.
In which of the following situations is an auction especially effective? Select all that apply.
Answer:
The seller is time-sensitive
Question:
is correct
Auctions are effective when a seller needs to sell an item by a certain date. A seller could use a
fixed price when he or she is not under time pressure.
Buyers' valuation of the auction item is within a narrow range.
is correct
An auction will be especially effective if buyers' valuations of the item are close together. This
ensures that the sale price will be close to the WTP of the second highest bidder (based on the
Revenue Equivalence Result).
The seller does not know the WTP of its potential customers.
is correct
Updated Study Material 2026
Question:
Which of the following events would, all else equal, cause a rightward shift of the demand curve
for yachts? Select all that apply.
Answer:
A decrease in the price of
yachts
Question:
A change in the price of yachts would not shift the demand curve for yachts. Price changes only
affect quantity demanded, not overall demand.
An increase in household income
is correct
An increase in income would allow more households to be able to afford yachts, shifting the
overall demand for yachts at any given price to the right.
The elimination of a regulation, which had prevented boats from sailing on a particular series of
lakes
is correct
The elimination of a regulation on boats would increase the demand for yachts to sail in
previously forbidden waters.
Your toy company is looking into launching a new line of dolls and action figures but is unsure if
kids these days still actually play with them. As part of your market research, you send out a
survey to 1000 households that have purchased toys in the last five years. You also decide to run
two focus groups: one group of children ages 4-16 and one group of parents.
Which of the following questions asked in a survey or focus group would be unbiased and allow
you to gain reliable information? Select all that apply.
Answer:
A survey
question asking households, "How much money per month do you typically spend on your
children's happiness?"
Question:
This question is too broad and could be biased. For example, some parents will likely overstate
the amount they spend on their children to seem like better parents.
, figures?"
time they spend playing with toys. It might also be the case that children lie about which toys
they use and how often.
A survey question asking households, "What fraction/percentage of income do you estimate that
your family spends on entertainment in a given month?"
is correct
This question seems reasonable and could be useful to estimate potential market size.
A focus group question asking parents, "With which types of toys do your children typically
play?"
is incorrect
This question could be biased. Parents that work during the day might not know what kinds of
toys that their kids like to play with. It might also be that parents would want their children to
play with more educational toys than they actually do.
An anonymous survey question asking children, "what's your favorite toy and why do you like to
play with it?
is correct
This question is likely to evoke a truthful response and allow your company see some common
features of toys that kids would value.
In which of the following situations is an auction especially effective? Select all that apply.
Answer:
The seller is time-sensitive
Question:
is correct
Auctions are effective when a seller needs to sell an item by a certain date. A seller could use a
fixed price when he or she is not under time pressure.
Buyers' valuation of the auction item is within a narrow range.
is correct
An auction will be especially effective if buyers' valuations of the item are close together. This
ensures that the sale price will be close to the WTP of the second highest bidder (based on the
Revenue Equivalence Result).
The seller does not know the WTP of its potential customers.
is correct
