Example of Short Answer Questions

There are six basic types of short-answer question:

• Definition questions.  

For these questions, you simply need to define a concept. 

• Example:  “What is a demand curve?”  
• Answer:  “It is a curve that shows the quantity demanded of a particular good or service at many different prices.”

• Explanation questions.

For these questions, you need to explain why something is true or how something works. 

• Example:  “Why is the demand curve downward-sloping for most goods?”  
• Answer:  “Because as the price of a good falls, people tend to buy more of it. When the price is lower, buying the good involves a smaller sacrifice in terms of other goods.”

• Example questions.  

For these questions, you need to state one or more specific, real-world instances of some concept.

• Example:  “Give two examples of pairs of goods that are complements.”  
• Answer:  “Cameras and camera film.  Peanut butter and jelly.”

• Relationship questions.  

For these questions, you need to state how two or more things relate to each other.  Are they opposites?  Are they the same thing?  Is one an example of the other?  How do they differ?  Etc.  These are usually the most difficult questions.

• Example:  “In a competitive market economy, what is the relationship between prices and scarcity?” 
• Answer:  “Prices usually reflect scarcity directly.  More scarce commodities have higher prices, while less scarce commodities have lower prices.”

• Example:  “What is the difference between demand and quantity demanded?”
• Answer:  “Quantity demanded is the amount of a good consumers will buy at a specific price, whereas demand shows the quantities demanded for many different prices.”

• Calculation questions.  

For these questions, you need to calculate a numerical answer or answers. 

• Example:  “If the demand for boxes of cereal is given by P = 100 – 0.1Q_d, and the supply is given by P = 20 + 0.1Q_s, what is the market equilibrium price and quantity?”  
• Answer:  “Q* = 400, P* = 60.”

• Graphing questions.  

For these questions, you need to respond with a simple graph.  Make sure you clearly label your axes and curves.  Unless the question specifically asks for an explanation, no explanation is necessary! 

• Example:  “Draw a diagram of a market with an effective price ceiling below the market price.  Mark the resulting shortage.”

Make sure you know what kind of question you’re answering!  Many students lose points by giving the wrong kind of answer.

• If it’s a definition question, don’t give an example instead. 
• Example:  “What is meant by economies of scale?”  
• Bad answer:  “Economies of scale is like when Ford Motors came up with the idea of assembly-line production of automobiles.”  
• Good answer:  “Economies of scale is when the long-run average cost of production falls as output rises.”
• If it’s an example question, don’t give a definition instead.
• Example:  “Give an example of substitute goods.”  
• Bad answer:  “A substitute good is one that you’ll buy more of when the price of a similar good goes up.”  
• Good answer:  “Butter and margarine.”
• If it’s an explanation question, don’t give a definition or an example.
• Example:  “Why do economies of scale occur?”  
• Bad answer:  “Economies of scale occur when the average cost of production goes down as output goes up.”  [This is a correct description of economies of scale, but it doesn’t say why the average cost goes down as output goes up.]  Another bad answer:  “Economies of scale happens because you can make more cars for cheaper by having an assembly line.”  [This answer is too specific, because economies of scale are a concept that applies to more than just cars.]  
• Good answer:  “Economies of scale usually occur because firms can make use of mass production techniques that involve greater specialization of both labor and capital.”
• If it’s relationship question, don’t just give two definitions (unless the wording of the definitions makes the relationship obvious).
• Example:  “For most goods, what is the relationship between price and quantity demanded?”  
• Bad answer:  “Price is the amount of money you have to pay for the good.  Quantity demanded is how much you buy.”  
• Good answer:  “As the price of a good rises, quantity demanded tends to fall.”

The point is, it’s not enough to say something correct.  You also have to say something that directly answers the question asked.