micro econ test 1
  • 1. what is economics?
A) the study of only businesses
B) the study of technology
C) the study of how societies use limited resources to meet unlimited needs
D) the study of money only
  • 2. what are basic needs?
A) the essential goods and services required for survival
B) things you want ,but are not essential
C) items that government controls
D) expensive things people buy for fun
  • 3. what are luxury goods?
A) expensive ,high quality that not essential for survival
B) cheap goods found in most stores
C) items that only businesses produce
D) goods that everyone needs to survive
  • 4. what is capital in economic?
A) human resources like effort and skills
B) money owned by individuals
C) natural resources like water and land
D) man-mad resources used to produce goods and services
  • 5. what is labor ?
A) the money businesses make
B) the effort of humans [physical and mental ]used in production
C) the things people own
D) the land where goods are produced
  • 6. what is entrepreneurship?
A) the effort used in production
B) the study of government policies
C) the ability to organize and manage a businesses while taking risk
D) the natural resources used to make goods
  • 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 consumer behavior only
B) the study of individual businesses
C) the study of the economy at a national and global level
D) the study of the supply of money
  • 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 businesses are not allowed to compete
D) a system where private individuals own resources and make decisions with little government interference
  • 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) consumer preferences
B) profit and loss
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) one time buyer
B) discount-oriented buyers
C) ethical conscious buyers
D) impulse buyers
  • 14. what does the law of diminishing returns state?
A) the total output will always increase as long as resources are available
B) as more of one input is added , the additional output will eventually decrease
C) adding more workers always increase output at the same rate
D) output decrease as fewer workers are added
  • 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) ar/vr experiences
D) voice search
  • 16. what is labor ?
A) physical and mental used in production
B) the land where goods are produced
C) things people own
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) the essential goods and services required for human and well being
D) non essential wants that can be purchased with extra income
  • 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 essential for survival
D) goods that are affordable for most people
  • 19. which of the following is NOT a factor of production ?
A) labor
B) land
C) capital
D) money
  • 20. which factor of production refers to human effort [physical and mental ]used in the production of goods and services ?
A) entrepreneurship
B) labor
C) land
D) capital
  • 21. consumer tend to buy more products when ;
A) the price goes up
B) it is not advertised
C) the price goes down
D) it is hard to find
  • 22. when company can adjust all inputs ,this is called?
A) long run
B) short run
C) fixed period
D) shutdown period
  • 23. in the short run ,at least one input is ?
A) always increasing
B) variable
C) fixed
D) unimportant
  • 24. law of diminishing marginal utility states that as consumption increase ,added
A) bouble
B) stays the same
C) increase
D) decreases
  • 25. consumer make decisions to maximized their ;
A) expenses
B) effort
C) satisfaction
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) decreasing returns to scale
D) constant returns to scale
  • 27. the budget constraint means that consumers
A) prefer expensive products
B) never think about money when buying
C) must choose how to spend their money
D) can buy limited products
  • 28. what are the four factors of production ?
A) water ,fire air, earth
B) cost ,price ,profit ,loss
C) land ,labor ,capital, entrepreneurship
D) income ,output, demand ,supply
  • 29. what is giffen good?
A) a substitute good
B) a luxury brand item
C) a good where demand increase as price increase
D) a product that always follows the law of demand
  • 30. which of the following best describes businesses purchasing products for commercial use in bulk ?
A) impulse buyers
B) social media -influenced buyers
C) ethical /conscious buyers
D) businesses buyers (B2B buyers)
  • 31. which of the following best describe elastic demand (PED>1)?
A) the demand curve is perfectly vertical
B) the quantity demanded does not change with price changes
C) consumers respond very little to 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) price increase leads to lower total revenue
B) total revenue is maximized when PED is equal to 1
C) price changes does not effect total revenue
D) price increase leads to higher total revenue
  • 33. in utility theory ,what does marginal utility (MU)refer to?
A) the additional satisfaction from consuming one more unit of a product
B) the total satisfaction from consuming 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) land
B) goods and services
C) economic resources
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 relationship between price and quantity demanded
B) the responsiveness of demand for a goods
C) the way supply responds to changes in income
D) how income effects the supply of labor
  • 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 macro economics looks at the overall economy
C) microeconomics focuses on individuals and businesses ,while macroeconomics looks at the overall economy
D) they are essentially the same ,just different terms
  • 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) land
D) entrepreneurship
  • 39. which of the following is an example of inelastic demand ?
A) clothing
B) electronics
C) luxury cars
D) medicine
  • 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) land
B) labor
C) entrepreneurship
D) money
  • 42. what does empirical validation refer to in economics ?
A) testing theories using world data
B) theoretical assumption made without evidence
C) the analysis of financial data only
D) the use of historical data in theory formation
  • 43. loss aversion is a concept in behavioral economics which suggest that;
A) people fear losing more than enjoy gaining
B) people make decisions based on logical analysis
C) people make choices solely one benefits
D) people are indifferent between gains and losses
  • 44. what is entrepreneurship ?
A) the effort used in production
B) the study of government policies
C) the natural resources used to make goods
D) manage businesses while taking risks
  • 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) luxury goods like designer bags
B) gasoline
C) salt
D) life saving medicine
  • 47. what major concerns in digital marketing is driving marketers to focus on data practices ?
A) content saturation
B) video marketing
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) email campaigns
B) interactive and immersive content
C) social media advertising
D) print marketing
  • 49. inelastic demand occurs when;
A) the good is a necessity with few substitute
B) there are many substitute available for the good
C) the good has high production costs
D) the goods is expensive to income
  • 50. engles law states that ;
A) as income rises ,spending on necessities increase
B) spending on luxuries increase while spending on necessities remains the same
C) as income fails , spending on luxuries increase
D) spending on both necessities and luxuries decrease as income rises
  • 51. which of theses is most likely to have inelastic demand ?
A) airline tickets
B) luxury cars
C) salt
D) concert tickets
  • 52. which of the following is an example of a luxury good ?
A) designer watches
B) bread
C) medicine
D) water
  • 53. if PED is less than 1 ,what type of demand does the production have?
A) unitary elastic demand
B) inelastic demand
C) elastic demand
D) perfectly elastic 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) consumer react to losses more strongly than gains
C) consumers make decisions based one emotions and biases
D) consumer aims to maximize their satisfaction within their budget
  • 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) salt
D) water
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