micro econ test 1
  • 1. what is economics?
A) the study of money only
B) the study of technology
C) the study of how societies use limited resources to meet unlimited needs
D) the study of only businesses
  • 2. what are basic needs?
A) items that government controls
B) expensive things people buy for fun
C) things you want ,but are not essential
D) the essential goods and services required for survival
  • 3. what are luxury goods?
A) cheap goods found in most stores
B) items that only businesses produce
C) goods that everyone needs to survive
D) expensive ,high quality that not essential for survival
  • 4. what is capital in economic?
A) man-mad resources used to produce goods and services
B) money owned by individuals
C) human resources like effort and skills
D) natural resources like water and land
  • 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 ability to organize and manage a businesses while taking risk
B) the effort used in production
C) the study of government policies
D) the natural resources used to make goods
  • 7. what is microeconomics?
A) the analysis of government policies
B) the study of the entire national economy
C) the study of international trade
D) the study of individuals and businesses making decisions
  • 8. what is macroeconomics?
A) the study of individual businesses
B) the study of the economy at a national and global level
C) the study of the supply of money
D) the study of consumer behavior only
  • 9. what is the free enterprise system?
A) a system where private individuals own resources and make decisions with little government interference
B) an economy where the government controls all businesses
C) a government run economy
D) a system where businesses are not allowed to compete
  • 10. what is the right to private property?
A) the right to live anywhere in the country
B) the right to sell goods freely
C) the right to only own land
D) the right to own,control and transfer resources without interference from the government
  • 11. the is the primary focus of economics?
A) the study of government policies
B) the study of money supply
C) the study of how societies allocate limited resources to satisfy unlimited wants and needs
D) the study of technology
  • 12. the cobb douglas production function is used to measure ;
A) profit and loss
B) consumer preferences
C) inputs and output
D) demand and supply
  • 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) as more of one input is added , the additional output will eventually decrease
B) the total output will always increase as long as resources are available
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) voice search
C) social media advertising
D) ar/vr experiences
  • 16. what is labor ?
A) the money businesses make
B) things people own
C) physical and mental used in production
D) the land where goods are produced
  • 17. what are basic needs ?
A) non essential wants that can be purchased with extra income
B) expensive products that provide comport and prestige
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) high quality ,expensive products that are desired for comport ,prestige ,or status
B) goods that essential for survival
C) goods that are affordable for most people
D) goods that are produced by government intervention
  • 19. which of the following is NOT a factor of production ?
A) labor
B) capital
C) money
D) land
  • 20. which factor of production refers to human effort [physical and mental ]used in the production of goods and services ?
A) capital
B) land
C) entrepreneurship
D) labor
  • 21. consumer tend to buy more products when ;
A) the price goes up
B) the price goes down
C) it is not advertised
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) fixed
C) variable
D) unimportant
  • 24. law of diminishing marginal utility states that as consumption increase ,added
A) bouble
B) decreases
C) stays the same
D) increase
  • 25. consumer make decisions to maximized their ;
A) losses
B) satisfaction
C) effort
D) expenses
  • 26. if the company doubles its input and output less than doubles ,this is called ?
A) no returns to scale
B) decreasing returns to scale
C) constant 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) can buy limited products
D) never think about money when buying
  • 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 good where demand increase as price increase
B) a product that always follows the law of demand
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) impulse buyers
B) ethical /conscious buyers
C) businesses buyers (B2B buyers)
D) social media -influenced buyers
  • 31. which of the following best describe elastic demand (PED>1)?
A) consumers respond very little to price changes
B) consumer responds significantly to price changes
C) the quantity demanded does not change with price changes
D) the demand curve is perfectly vertical
  • 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) total revenue is maximized when PED is equal to 1
C) price changes does not effect total revenue
D) price increase leads to lower total revenue
  • 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) economic resources
B) land
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) unitary elastic demand
B) elastic demand
C) perfectly elastic demand
D) inelastic 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) the relationship between price and quantity demanded
D) how income effects the supply of labor
  • 37. what is the main difference between microeconomics and macroeconomics ?
A) microeconomics focuses on individuals and businesses while macro economics looks at the overall economy
B) microeconomics focuses on individuals and businesses ,while macroeconomics looks at the overall economy
C) they are essentially the same ,just different terms
D) microeconomic focuses on government policies ,while macroeconomics focuses on structures
  • 38. which factor of production refers to human effort (physical and mental )used in the production of goods and services ?
A) land
B) labor
C) entrepreneurship
D) capital
  • 39. which of the following is an example of inelastic demand ?
A) clothing
B) electronics
C) medicine
D) luxury cars
  • 40. what does e-commerce primarily refer to?
A) in person retail transaction
B) businesses to businesses networking
C) transactions related to government services
D) the buying and selling of goods and services over the internet
  • 41. which of the following is not on e of the four factors of production?
A) land
B) entrepreneurship
C) labor
D) money
  • 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) theoretical assumption made without evidence
D) the analysis of financial data only
  • 43. loss aversion is a concept in behavioral economics which suggest that;
A) people make decisions based on logical analysis
B) people fear losing more than enjoy gaining
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) 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) salt
D) gasoline
  • 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) print marketing
B) interactive and immersive content
C) email campaigns
D) social media advertising
  • 49. inelastic demand occurs when;
A) the good is a necessity with few substitute
B) the goods is expensive to income
C) there are many substitute available for the good
D) the good has high production costs
  • 50. engles law states that ;
A) spending on luxuries increase while spending on necessities remains the same
B) spending on both necessities and luxuries decrease as income rises
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) airline tickets
B) concert tickets
C) luxury cars
D) salt
  • 52. which of the following is an example of a luxury good ?
A) medicine
B) water
C) bread
D) designer watches
  • 53. if PED is less than 1 ,what type of demand does the production have?
A) elastic demand
B) inelastic demand
C) unitary elastic demand
D) perfectly 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) electricity
B) water
C) salt
D) luxury goods
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