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