chapter ten principles of economics multiple choice the word that comes from the greek word for “one who manages household” is market. consumer. producer. additional sample questions with sample answers. Peggy G. grade The NAEP economics assessment includes items classified across three interrelated. Witztum: Economics - An Analytical Introduction. Questions and answers. The author has written two extra sets of questions and answers, which are available.

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    Economics Questions And Answers Pdf

    answer questions, how to skip questions, how to go back to questions you skipped, . The Economics test is designed for candidates who want to become high. and answer notes. Introduction. The examination questions that follow are actual finals papers from the Economics course within the honours degree. Economics question and answer was published in The file is available in PDF format. It is for the preparation of Economics. Solutions are not available.

    Firms are price setters. There are few sellers in the market. Firms can exit and enter the market freely. All of these 2 If a perfectly competitive firm currently produces where price is greater than marginal cost it a. Price is below the minimum of average variable cost. Fixed costs exceed variable costs. Average fixed costs are rising. Marginal cost is above average variable cost. Fixed costs exceed sunk costs. Average fixed cost is rising. Revenue from production is less than total costs. Drive down market prices. Drive down profits of existing firms in the market.

    EduGorilla Study Material Category: Economics , General Knowledge. Share this: Reviews There are no reviews yet. You are almost done!! To submit your Query. Please provide your Details. Select City. Select Locality.

    Please enter the OTP to verify your mobile number. Congratulation Your query has been submitted successfully. We Accept. New Member? Sign up for free. Log in With Google. Outside India. Already a member? Sign in. Gross Deistic Product c. Gross dynamic product d. All of these 16 GNP stands for a. Gross national product b.

    Gross natural product c. Both a and b d. None of these 17 When the demand for a product is tied to the download of some parent product, its demand is called induced or derived. As prices fall, quantity demanded increases. As prices rise, quantity demanded increases. As prices fall, demand increases. As prices rise, demand decreases. This process is known as: a.

    Price rationing. Price fixing. Quantity adjustment. Quantity demanded will increase. Quantity supplied will increase.

    Demand will increase. Demand will decrease. An decrease in the price of golf balls. An increase in the price of golf clubs. A decrease in the cost of producing golf balls. An increase in average household income when golf balls are a normal good. Quantity supplied will decrease.

    Supply will increase. Supply will decrease. A decrease in the price of pesticides. An increase in the demand for wheat.

    A rise in the price of wheat. An increase in the price of corn. The quantity of this wine demanded. The quantity of this wine supplied. The demand for this wine. The supply of this wine. Technological change. A change in input prices. A change in the market price of the good. A change in the number of firms in the market. Demand decreases and supply decreases.

    Demand remains constant and supply increases. Demand decreases and supply increases. Demand increases and supply increases. Incomes rise for a normal good or fall for an inferior good b. The price of a complement falls c. The price of a substitute rises d. All of these 14 Two explanations for the law of demand are a Price and quantity effects. When the price of a product is increased 10 percent, the quantity demanded decreases 15 percent.

    In this range of prices, demand for this product is: a. If the price elasticity of demand for a product is equal to 0.

    This is best explained by the fact that: a. Cheerios are a luxury. A state government wants to increase the taxes on cigarettes to increase tax revenue.

    Sony is considering a 10 percent price reduction on its color television sets. If the demand for sets in this price range is inelastic: A revenues from color sets will remain constant. B revenues derived from color sets will decrease. C revenues derived from color sets will increase. D the number of television sets sold will decrease 13 Elasticity of demand for a commodity with respect to change in its price. A positive cross elasticity of demand coefficient indicates that: a.

    The price elasticity of demand for this product is approximately: a. The higher the level of income. The larger the proportion of monthly income spent on it. The fewer the good substitutes available. The higher the price of complementary goods. The higher the income. The lower the price. The shorter the passage of time after a permanent price increase. The more substitutes available for the good. The two goods are luxury goods. The two goods are complements.

    The two goods are substitutes. The two goods are normal goods. Assume the product has a straight-line, downward sloping demand. The product has no close substitutes. A very small proportion of income is spent on the good. A lower price 3 For a given normal supply curve, the amount of a tax paid by the downloader will be larger a.

    The supply is perfectly elastic. The supply is perfectly inelastic. The demand is unit elastic. The demand is perfectly inelastic. The demand for aglets is probably a. Its complements but not its substitutes. The operations function c. The accounting and finance function d. The marketing including sales function 2 Most operations produce a mixture of both products and services. IT company b. A Restaurant c. Steel company 3 Operations can be classified according to their volume and variety of production as well as the degree of variation and visibility.

    Which of the following operations would be classified as high volume, low variety? A family doctor b. A carpenter c. A front office bank d. A fast food restaurant 4 Which of the following activities is not a direct responsibility of operations management? Planning and controlling the operation c. Developing an operations strategy for the operation d. Determining the exact mix of products and services that customers will want 5 Operations can be classified according to the degree of variation in demand and visibility of the operation as well as their volume and variety of production.

    Which of the following operations would be classified as high variation and high visibility? A front office bank b. A family doctor c. A fast food restaurant d. A carpenter 6 The production function incorporates the technically efficient method of …………. All of these 7 A fixed input is one whose quantity cannot be varied during the time under consideration.

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    None of these 9 The law of variable proportions states that as the quantity of one factor is increased, keeping the other factors fixed, the marginal product of that factor will eventually decline. Marginal Revenue Product b. Marginal Revenue process c. None of these 11 The book value of old equipment is not a relevant cost in a decision. One of the dangers of allocating common fixed costs to a product line is that such allocations can make the line appear less profitable than it really is.

    A differential cost is a variable cost. All future costs are relevant in decision making. Variable costs are always relevant costs. Costs that change between alternatives are called a. A cost incurred in the past that cannot be changed by any future action is a n a. All of these. The marginal productivity of labor equals the average productivity of labor a. The law of diminishing marginal productivity a.

    Both A and B above. Neither A nor B above. None of these 14 Isoquants that are downward-sloping straight lines imply that the inputs a. None of these 20 MRTS stands for…….. Marginal rate of technical structure b. Marginal rate of technical substitution c. Formulating the standards of operations. Formulating the rational policy on plant size. Formulating a policy of profit prediction. All of these 9 Cost in the short-run can be classified into………and variable cost.

    None of these 10 Total fixed costs remained fixed irrespective of increase or decrease in production of activity. None of these 12 The ………. V-shape b. Q-shape c. U-shape d. All of these 13 Scale economies and returns to scale generally produce a U-shaped long-run average cost curve, such as the one displayed to the right. Financial management b.

    Profit maximization c. Agency theory d. Social responsibility 15 A concept that implies that the firm should consider issues such as protecting the consumer, paying fair wages, maintaining fair hiring practices, supporting education, and considering environmental issues.

    Social responsibility 16 Which of the following is not normally a responsibility of the treasurer of the modern corporation but rather the controller? Budgets and forecasts b. Asset management c. Investment management d. Perfect competition. Monopolistic competition.

    Business Economic Risk Index. Business Economic Rating International. Business Education Rating Indicator. Business Environment Risk Index. Monopolistic competition b. Oligopoly c. Duopoly d. Perfect competition 9 In industries in which there are scale economies, the variety of goods that a country can produce is constrained by a.

    Corporate growth. Return on investment. Profit maximization. None of these 14 Which of the following is NOT a marketing objective? Cash flow. Volume sales. None of these 15 Setting a price below that of the competition is called: a.

    Economy Quiz

    Penetration pricing. Competitive pricing. None of these 16 Which of the following is NOT a reason for cutting prices? Capacity utilisation. Increasing profit margins. Market defence. None of these 17 Which of the following is NOT a reason for increasing prices? Cost pressures. Price comparison. Curbing demand. None of these 18 The costs that depend on output in the short run are: a.

    In this period, all costs ever incurred by the firm must be recovered. A perfectly competitive firm will maximize profit at the quantity at which the firm's marginal revenue equals a. Increasing its output. Decreasing its output. Increasing its price. Increasing its resources. Economic profit b. Allocative Efficiency c. Productive Efficiency d. Normal profit 4 If the price a firm receives for its product is equal to the marginal cost of producing that product, the firm is: a.

    Always earning an economic profit b. Always productively efficient. Always allocatively efficient.

    Always experiencing an economic loss. Earning an economic profit. Productively efficient. Dominating the other firms in the market.

    Economics – Multiple Choice Questions (MCQ) with Answers

    Not producing enough output. Heterogeneous or differentiated. Interdependence in pricing and output decisions. Differentiated products. Barriers to entry. Differentiated product. Difficult entry into the industry.


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