micro econ test 1
  • 1. what is economics?
A) the study of money only
B) the study of only businesses
C) the study of how societies use limited resources to meet unlimited needs
D) the study of technology
  • 2. what are basic needs?
A) expensive things people buy for fun
B) the essential goods and services required for survival
C) things you want ,but are not essential
D) items that government controls
  • 3. what are luxury goods?
A) expensive ,high quality that not essential for survival
B) goods that everyone needs to survive
C) cheap goods found in most stores
D) items that only businesses produce
  • 4. what is capital in economic?
A) natural resources like water and land
B) man-mad resources used to produce goods and services
C) money owned by individuals
D) human resources like effort and skills
  • 5. what is labor ?
A) the effort of humans [physical and mental ]used in production
B) the things people own
C) the land where goods are produced
D) the money businesses make
  • 6. what is entrepreneurship?
A) the effort used in production
B) the study of government policies
C) the natural resources used to make goods
D) the ability to organize and manage a businesses while taking risk
  • 7. what is microeconomics?
A) the study of individuals and businesses making decisions
B) the analysis of government policies
C) the study of the entire national economy
D) the study of international trade
  • 8. what is macroeconomics?
A) the study of consumer behavior only
B) the study of the economy at a national and global level
C) the study of the supply of money
D) the study of individual businesses
  • 9. what is the free enterprise system?
A) a government run economy
B) a system where businesses are not allowed to compete
C) a system where private individuals own resources and make decisions with little government interference
D) an economy where the government controls all businesses
  • 10. what is the right to private property?
A) the right to own,control and transfer resources without interference from the government
B) the right to live anywhere in the country
C) the right to only own land
D) the right to sell goods freely
  • 11. the is the primary focus of economics?
A) the study of how societies allocate limited resources to satisfy unlimited wants and needs
B) the study of technology
C) the study of government policies
D) the study of money supply
  • 12. the cobb douglas production function is used to measure ;
A) inputs and output
B) consumer preferences
C) demand and supply
D) profit and loss
  • 13. what type of buyer is most likely to engage in purchasing products from online platforms like amazon or flipkart after receiving special discounts?
A) discount-oriented buyers
B) one time buyer
C) impulse buyers
D) ethical conscious buyers
  • 14. what does the law of diminishing returns state?
A) output decrease as fewer workers are added
B) as more of one input is added , the additional output will eventually decrease
C) the total output will always increase as long as resources are available
D) adding more workers always increase output at the same rate
  • 15. which technological advancement became crucial in 2015-2020 for optimizing content trough voice assistant like siri and alexa ?
A) social media advertising
B) ar/vr experiences
C) voice search
D) ai chatbots
  • 16. what is labor ?
A) physical and mental used in production
B) things people own
C) the money businesses make
D) the land where goods are produced
  • 17. what are basic needs ?
A) expensive products that provide comport and prestige
B) non essential wants that can be purchased with extra income
C) wants that are only important to businesses
D) the essential goods and services required for human and well being
  • 18. what are luxury goods ?
A) goods that essential for survival
B) goods that are produced by government intervention
C) high quality ,expensive products that are desired for comport ,prestige ,or status
D) goods that are affordable for most people
  • 19. which of the following is NOT a factor of production ?
A) money
B) land
C) labor
D) capital
  • 20. which factor of production refers to human effort [physical and mental ]used in the production of goods and services ?
A) land
B) capital
C) labor
D) entrepreneurship
  • 21. consumer tend to buy more products when ;
A) it is not advertised
B) it is hard to find
C) the price goes up
D) the price goes down
  • 22. when company can adjust all inputs ,this is called?
A) short run
B) shutdown period
C) fixed period
D) long run
  • 23. in the short run ,at least one input is ?
A) fixed
B) variable
C) always increasing
D) unimportant
  • 24. law of diminishing marginal utility states that as consumption increase ,added
A) stays the same
B) increase
C) decreases
D) bouble
  • 25. consumer make decisions to maximized their ;
A) losses
B) satisfaction
C) expenses
D) effort
  • 26. if the company doubles its input and output less than doubles ,this is called ?
A) constant returns to scale
B) decreasing returns to scale
C) increasing return to scale
D) no returns to scale
  • 27. the budget constraint means that consumers
A) must choose how to spend their money
B) can buy limited products
C) prefer expensive products
D) never think about money when buying
  • 28. what are the four factors of production ?
A) cost ,price ,profit ,loss
B) income ,output, demand ,supply
C) land ,labor ,capital, entrepreneurship
D) water ,fire air, earth
  • 29. what is giffen good?
A) a good where demand increase as price increase
B) a luxury brand item
C) a product that always follows the law of demand
D) a substitute good
  • 30. which of the following best describes businesses purchasing products for commercial use in bulk ?
A) social media -influenced buyers
B) impulse buyers
C) ethical /conscious buyers
D) businesses buyers (B2B buyers)
  • 31. which of the following best describe elastic demand (PED>1)?
A) consumers respond very little to price changes
B) the demand curve is perfectly vertical
C) consumer responds significantly to price changes
D) the quantity demanded does not change with price changes
  • 32. what is the relationship between the price elasticity demand (PED) and the total revenue for elastic demand ?
A) total revenue is maximized when PED is equal to 1
B) price increase leads to higher total revenue
C) price increase leads to lower total revenue
D) price changes does not effect total revenue
  • 33. in utility theory ,what does marginal utility (MU)refer to?
A) the satisfaction derived from all purchase
B) the total satisfaction from consuming a specific good
C) the total satisfaction from consuming a product
D) the additional satisfaction from consuming one more unit of a product
  • 34. what is the term for resources used to produce a goods and services ?
A) land
B) economic resources
C) goods and services
D) capital
  • 35. if the price of a goods increase and the quantity demanded decrease significantly ,which type elasticity is it?
A) inelastic demand
B) unitary elastic demand
C) perfectly elastic demand
D) elastic demand
  • 36. when does "income elasticity of demand " refer to ?
A) the way supply responds to changes in income
B) the relationship between price and quantity demanded
C) how income effects the supply of labor
D) the responsiveness of demand for a goods
  • 37. what is the main difference between microeconomics and macroeconomics ?
A) they are essentially the same ,just different terms
B) microeconomics focuses on individuals and businesses ,while macroeconomics looks at the overall economy
C) microeconomic focuses on government policies ,while macroeconomics focuses on structures
D) microeconomics focuses on individuals and businesses while macro economics looks at the overall economy
  • 38. which factor of production refers to human effort (physical and mental )used in the production of goods and services ?
A) land
B) capital
C) labor
D) entrepreneurship
  • 39. which of the following is an example of inelastic demand ?
A) electronics
B) clothing
C) luxury cars
D) medicine
  • 40. what does e-commerce primarily refer to?
A) the buying and selling of goods and services over the internet
B) transactions related to government services
C) businesses to businesses networking
D) in person retail transaction
  • 41. which of the following is not on e of the four factors of production?
A) money
B) labor
C) land
D) entrepreneurship
  • 42. what does empirical validation refer to in economics ?
A) testing theories using world data
B) the use of historical data in theory formation
C) the analysis of financial data only
D) theoretical assumption made without evidence
  • 43. loss aversion is a concept in behavioral economics which suggest that;
A) people make choices solely one benefits
B) people make decisions based on logical analysis
C) people are indifferent between gains and losses
D) people fear losing more than enjoy gaining
  • 44. what is entrepreneurship ?
A) the natural resources used to make goods
B) the effort used in production
C) manage businesses while taking risks
D) the study of government policies
  • 45. what is labor ?
A) the money businesses make
B) the land where goods are produced
C) physical and mental used in production
D) the things person own
  • 46. which of the following goods is most likely to have elastic demand ?
A) salt
B) luxury goods like designer bags
C) life saving medicine
D) gasoline
  • 47. what major concerns in digital marketing is driving marketers to focus on data practices ?
A) video marketing
B) content saturation
C) data privacy and security influencer marketing
  • 48. which of the following is a trend for the future that allows for more personalized and engaging experiences using technology ?
A) interactive and immersive content
B) print marketing
C) email campaigns
D) social media advertising
  • 49. inelastic demand occurs when;
A) there are many substitute available for the good
B) the good is a necessity with few substitute
C) the good has high production costs
D) the goods is expensive to income
  • 50. engles law states that ;
A) spending on both necessities and luxuries decrease as income rises
B) spending on luxuries increase while spending on necessities remains the same
C) as income rises ,spending on necessities increase
D) as income fails , spending on luxuries increase
  • 51. which of theses is most likely to have inelastic demand ?
A) luxury cars
B) salt
C) concert tickets
D) airline tickets
  • 52. which of the following is an example of a luxury good ?
A) designer watches
B) medicine
C) water
D) bread
  • 53. if PED is less than 1 ,what type of demand does the production have?
A) perfectly elastic demand
B) unitary elastic demand
C) elastic demand
D) inelastic demand
  • 54. what is the main idea of utility theory (rational choice theory )?
A) consumer select combinations of goods that provide the same utility
B) consumers make decisions based one emotions and biases
C) consumer aims to maximize their satisfaction within their budget
D) consumer react to losses more strongly than gains
  • 55. what is an example of a perfectly inelastic demand ?
A) luxury goods
B) salt
C) life saving medicine
D) airline ticket
  • 56. which of the following products is likely to have elastic demand ?
A) electricity
B) luxury goods
C) water
D) salt
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