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