micro econ test 1
  • 1. what is economics?
A) the study of how societies use limited resources to meet unlimited needs
B) the study of money only
C) the study of only businesses
D) the study of technology
  • 2. what are basic needs?
A) things you want ,but are not essential
B) expensive things people buy for fun
C) the essential goods and services required for survival
D) items that government controls
  • 3. what are luxury goods?
A) expensive ,high quality that not essential for survival
B) items that only businesses produce
C) cheap goods found in most stores
D) goods that everyone needs to survive
  • 4. what is capital in economic?
A) natural resources like water and land
B) money owned by individuals
C) man-mad resources used to produce goods and services
D) human resources like effort and skills
  • 5. what is labor ?
A) the money businesses make
B) the effort of humans [physical and mental ]used in production
C) the land where goods are produced
D) the things people own
  • 6. what is entrepreneurship?
A) the natural resources used to make goods
B) the effort used in production
C) the study of government policies
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 analysis of government policies
C) the study of international trade
D) the study of the entire national economy
  • 8. what is macroeconomics?
A) the study of the supply of money
B) the study of the economy at a national and global level
C) the study of consumer behavior only
D) the study of individual businesses
  • 9. what is the free enterprise system?
A) a system where businesses are not allowed to compete
B) a government run economy
C) an economy where the government controls all businesses
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 only own land
B) the right to sell goods freely
C) the right to live anywhere in the country
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 technology
B) the study of how societies allocate limited resources to satisfy unlimited wants and needs
C) the study of money supply
D) the study of government policies
  • 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) ethical conscious buyers
B) discount-oriented buyers
C) one time buyer
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) ar/vr experiences
B) ai chatbots
C) social media advertising
D) voice search
  • 16. what is labor ?
A) the money businesses make
B) the land where goods are produced
C) physical and mental used in production
D) things people own
  • 17. what are basic needs ?
A) the essential goods and services required for human and well being
B) non essential wants that can be purchased with extra income
C) expensive products that provide comport and prestige
D) wants that are only important to businesses
  • 18. what are luxury goods ?
A) goods that are produced by government intervention
B) goods that are affordable for most people
C) high quality ,expensive products that are desired for comport ,prestige ,or status
D) goods that essential for survival
  • 19. which of the following is NOT a factor of production ?
A) money
B) capital
C) labor
D) land
  • 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) capital
D) land
  • 21. consumer tend to buy more products when ;
A) the price goes down
B) it is not advertised
C) it is hard to find
D) the price goes up
  • 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) variable
B) always increasing
C) fixed
D) unimportant
  • 24. law of diminishing marginal utility states that as consumption increase ,added
A) decreases
B) stays the same
C) bouble
D) increase
  • 25. consumer make decisions to maximized their ;
A) satisfaction
B) expenses
C) losses
D) effort
  • 26. if the company doubles its input and output less than doubles ,this is called ?
A) decreasing returns to scale
B) increasing return to scale
C) no returns to scale
D) constant returns to scale
  • 27. the budget constraint means that consumers
A) can buy limited products
B) prefer expensive products
C) never think about money when buying
D) must choose how to spend their money
  • 28. what are the four factors of production ?
A) land ,labor ,capital, entrepreneurship
B) income ,output, demand ,supply
C) water ,fire air, earth
D) cost ,price ,profit ,loss
  • 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 luxury brand item
D) a substitute good
  • 30. which of the following best describes businesses purchasing products for commercial use in bulk ?
A) ethical /conscious buyers
B) businesses buyers (B2B buyers)
C) social media -influenced buyers
D) impulse buyers
  • 31. which of the following best describe elastic demand (PED>1)?
A) consumers respond very little to price changes
B) the demand curve is perfectly vertical
C) consumer responds significantly 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 lower total revenue
B) price increase leads to higher total revenue
C) price changes does not effect 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 additional satisfaction from consuming one more unit of a product
B) the total satisfaction from consuming a specific good
C) the total satisfaction from consuming a product
D) the satisfaction derived from all purchase
  • 34. what is the term for resources used to produce a goods and services ?
A) economic resources
B) capital
C) goods and services
D) land
  • 35. if the price of a goods increase and the quantity demanded decrease significantly ,which type elasticity is it?
A) inelastic demand
B) elastic demand
C) perfectly elastic demand
D) unitary elastic demand
  • 36. when does "income elasticity of demand " refer to ?
A) how income effects the supply of labor
B) the relationship between price and quantity demanded
C) the responsiveness of demand for a goods
D) the way supply responds to changes in income
  • 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) labor
B) entrepreneurship
C) capital
D) land
  • 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) the buying and selling of goods and services over the internet
B) in person retail transaction
C) transactions related to government services
D) businesses to businesses networking
  • 41. which of the following is not on e of the four factors of production?
A) entrepreneurship
B) land
C) money
D) labor
  • 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) the analysis of financial data only
D) theoretical assumption made without evidence
  • 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 fear losing more than enjoy gaining
D) people make decisions based on logical analysis
  • 44. what is entrepreneurship ?
A) the effort used in production
B) the natural resources used to make goods
C) manage businesses while taking risks
D) the study of government policies
  • 45. what is labor ?
A) the things person own
B) physical and mental used in production
C) the money businesses make
D) the land where goods are produced
  • 46. which of the following goods is most likely to have elastic demand ?
A) salt
B) life saving medicine
C) luxury goods like designer bags
D) gasoline
  • 47. what major concerns in digital marketing is driving marketers to focus on data practices ?
A) video marketing
B) data privacy and security influencer marketing
C) content saturation
  • 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) print marketing
C) interactive and immersive content
D) email campaigns
  • 49. inelastic demand occurs when;
A) the good is a necessity with few substitute
B) the goods is expensive to income
C) the good has high production costs
D) there are many substitute available for the good
  • 50. engles law states that ;
A) as income fails , spending on luxuries increase
B) as income rises ,spending on necessities increase
C) spending on both necessities and luxuries decrease as income rises
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) salt
D) luxury cars
  • 52. which of the following is an example of a luxury good ?
A) water
B) bread
C) medicine
D) designer watches
  • 53. if PED is less than 1 ,what type of demand does the production have?
A) unitary elastic demand
B) perfectly elastic demand
C) inelastic demand
D) 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 aims to maximize their satisfaction within their budget
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) life saving medicine
B) airline ticket
C) salt
D) luxury goods
  • 56. which of the following products is likely to have elastic demand ?
A) salt
B) luxury goods
C) water
D) electricity
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