- 1. Managerial economics is a branch of economics that applies economic theory and quantitative methods to analyze business and management decisions. It helps business managers make optimal decisions by providing tools and frameworks to understand how firms behave in various market conditions and competitive environments. This discipline focuses on topics such as cost analysis, pricing strategies, demand forecasting, risk management, and decision-making under uncertainty. By utilizing economic principles and techniques, managerial economics assists managers in maximizing profits, minimizing costs, and effectively allocating resources to achieve the long-term goals of the organization.
What is the primary goal of managerial economics?
A) Maximizing profits
B) Maximizing revenue
C) Achieving revenue targets
D) Minimizing costs
- 2. Which of the following is not a characteristic of a perfect competition market structure?
A) High barriers to entry
B) Homogenous products
C) Large number of buyers and sellers
D) Perfect information
- 3. What is the term that describes the additional cost incurred to produce one more unit of a good or service?
A) Fixed cost
B) Marginal cost
C) Variable cost
D) Average cost
- 4. Which of the following is a non-price competition strategy?
A) Seasonal sales
B) Product differentiation
C) Discounts
D) Price matching
- 5. In which market structure are there few sellers offering similar or identical products?
A) Monopoly
B) Perfect competition
C) Monopolistic competition
D) Oligopoly
- 6. What type of market structure is characterized by a single seller with significant control over price?
A) Oligopoly
B) Monopoly
C) Monopolistic competition
D) Perfect competition
- 7. What does the price elasticity of demand measure?
A) Total revenue
B) Government subsidies
C) Cost of production
D) Responsiveness of quantity demanded to price changes
- 8. What does the term 'opportunity cost' refer to in economics?
A) The actual cost of producing a good
B) The profit margin
C) The value of the next best alternative foregone
D) The total cost of production
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