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Quiz for Basic Microeconomics
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Questions in this quiz (77)
1is the efficient allocation of the scarce means of production toward the satisfaction of human wants.
- ARESOURCE UTILIZATION
- BECONOMICS
- CECONOMIZING
2SCARCITY AS NOT HAVING ENOUGH MONEY is an illusion according to:
- AJohn Maynard Keynes
- BAdam Smith
- CSam Smith
3SCARCITY AS NOT HAVING ENOUGH MONEY is WEALTH OF NATIONS = optimal combination of L,La,K, E according to:
- AAdam Smith
- BJohn Maynard Keynes
- CSam Smith
4-To save up
-To deny ourselves of various tempting treasures
-To have enough money for that one big-ticket item
-We economize by making do with some lower-prized items- AECONOMIZING
- BSCARCITY
- CECONOMICS
5THE FOUR ECONOMIC RESOURCES
- ALand, Labor, Capital and Entrepreneurship
- BLand, Labor, Customize and Scarcity
- CLabor, Landscape, Economizing and Capital
6This is Forgone value of the next best alternative
- AScarcity
- BOpportunity Cost
- CTrade-Offs
7The good points that we have to give up in order to get another.
-It also create opportunity cost- ATrade-Offs
- BOpportunity Cost
- CScarcity
8Not all of our resources are being used
- AFrontier
- BUnemployment
- CProduction
9As one good expands (output), the opportunity cost of producing additional units of this good increases.
- ALaw of Decreasing Cost
- BLaw of Increasing Trade off
- CLaw of Increasing Cost
10Every economy will use the best available technology
- AEconomic Scarcity
- BEconomic Growth
- CEconomic Cost
11Four Basic Economic Questions
- A-What to Produce
-How much to Produce
-How to Produce
-Whom to Produce - B-What to Produce
-Where to Produce
-When to Produce
-Whom to Produce - C-When to Produce
-How much to Produce
-What to Produce
-Production
- A-What to Produce
12He believed that if people set out to promote the public interest, they will not do nearly as much good as they would if they pursued their own selfish interest
- ASam Smith
- BAdam Smith
- CJohn Meynard
13THE PRICE MECHANISM
Everyone has a price, which means that nearly all of us, for a certain sum of money, would do some pretty nasty things. The key variable here is PRICE.- ATrue
- BFalse
14Just as prices send signals to consumers, they also send signals to producers or sellers
- ATrue
- BFalse
15to allow the price mechanism to work, we need few competing firms in each industry
- ATrue
- BFalse
16The basis of capitalism is TRUST, lenders expect borrowers to pay them on time and in full. That is why sellers ship goods or provide services in advance of payment
- ATrue
- BFalse
17[blank_start]Goverment[blank_end] are bound by rules and regulations that is why before getting a good or service, it takes a long time
- AGoverment
18It is concerned with the optimal production and allocation of resources given existing factors of production
- AEquity
- BEfficiency
- CCapital
19It is concerned with how resources are fairly distributed throughout society
- Aeffieciency
- Bequity
- CServices
20People do with their incomes usually spend it on consumer goods and services, which are produced by private businesses.
- ATrue
- BFalse
21[blank_start]Economic Model[blank_end] shows us how our economy functions, tracing the flow of money, resources, and goods and services
- AEconomic Model
22Label the Economic Model
- AHouseholds
- BLabor Services
- CPayment for Goods and services
- DFirms
- EGoods and Services
- FWages, Salaries, and Benefits
23What are the Economic Role of the government?
- AThe government provides the legal system under which our free enterprise economy can operate
- BThey also maintain our competitive system and ensures the relatively unfettered operation of the law of supply and demand
- CThey collect the consumers personal revenue
- DThey collect taxes, provides services, and issues regulations
24What are the 3 basic classes of Market Failure?
these are:
[blank_start]Externalities[blank_end][blank_start]Curbing Environmental Pollution[blank_end]
[blank_start]Lack of Public goods and services[blank_end]- AExternalities
- BCurbing Environmental Pollution
- CLack of Public goods and services
25[blank_start]External Cost[blank_end] occurs when the production or consumption of some good or service inflicts cost on a third party without compensation
- AExternal Cost
26[blank_start]External benefit[blank_end] occurs when some of the benefits derived from the production or consumption of some good or service are enjoyed by a third party
- AExternal benefit
27Not everything produced by the public sector is a public good
- ATrue
- BFalse
28Non-excludable means everyone can not freely benefit
- ATrue
- BFalse
29Non-rivalrous means one person benefiting does not reduce available benefits for others
- ATrue
- BFalse
30Government failure Should not considered exceptions but the norm
- ATrue
- BFalse
31[blank_start]Capital[blank_end] is the crucial element in every economic system and it consists of plant and equipment
- ACapital
32According to him whoever controlled a society’s capital controlled that society
- AJohn meynard
- BAdam Smith
- CKarl Marx
33What is CAPITALISM
- APrivate ownership of most of the means of production
- BThe individuals are motivated by profit
- CProduction is guided by the price system
- DThe government’s role is kept to a minimum
- EThe individuals are not motivated by profit
34What is COMMUNISM
- AAbolish the private property
- BThe state would own everything
- CThe state will wither away eventually and we would be left with a worker's paradise
- DThey didn't want money but they want peace and public property
35Capitalism is pockets are full of money, but there isn’t anything in stores you can buy with it.
- ATrue
- BFalse
36Communism is like the stores are full, but you have no money in your pockets.
- ATrue
- BFalse
37What is Facism?
- ACorporatism (merger of state and corporate power)
- BThe means of production are left in private hands, with varying degrees of governmental interference
- CDictatorship
- DNone of the above
38What is Socialism?
- AEqual sharing of HAPPINESS and MISERY
- BLarge-scale redistribution of income
- CSubstantial degree of government not planning
- DSubstantial degree of government planning
- EGovernment ownership of some of the means of production
39[blank_start]SOCIALISM[blank_end]. State takes one and gives it to someone else
[blank_start]COMMUNISM[blank_end]. State takes both and gives you milk
[blank_start]FASCISM[blank_end]. State takes both and sells you milk
[blank_start]CAPITALISM[blank_end]. You sell one and buy a bull- ASOCIALISM
- BCOMMUNISM
- CFASCISM
- DCAPITALISM
40Interaction of the forces of supply and demand in the marketplace
- ASupply
- BDemand
- CPrice System
41Schedule of quantities of a good or service that people are willing and able to buy at different prices
The lower the price, the more people will buy
Inverse relationship: P↑Q↓ ; P↓ Q↑- ASupply
- BDemand
- CPrice System
42Schedule of quantities of a good or service that people are willing and able to sell at different prices
At higher prices, the suppliers are willing and able to sell larger and larger quantities while the buyers are willing to buy smaller and smaller quantities. Vice versa
Direct relationship: P↓ Q↓ : P↑ Q↑- ASupply
- BDemand
- CPrice System
43It is where the supply and demand curves cross
- AEquity
- BEquilibrium
- CEquilibrium Price
- DPrice Ceiling
44It is the price at which Od equals Qs
- AEquilibrium Price
- BPrice Floor
- CEquilibrium
45It is the quantity sold when Qd equals Qs
- AQuantity
- BEquilibrium Quantity
- CEquilibrium
46Occurs when the actual price, or the market price, is greater than the equilibrium price
You measure it by finding the horizontal distance between Qs and Qd- AShortage
- BSurplus
- CEquilibrium
47Occurs when the market price is below the equilibrium price
You can also measure it by finding the horizontal distance between Qd and Qs- AShortage
- BSurplus
- CEquilibrium Price
48[blank_start]Price floor[blank_end] is the owest price allowed to go in the market and it also protects the sellers
- APrice floor
49But what would happen to the market since the s&d are broken?
- Abuy the surplus
- BStrictly enforce the price floor and let surplus go to waste
- CControl how much is produced
- DSubsidize consumption
- ENone of the above
50[blank_start]Price ceiling[blank_end] is the highest price allowed in the market and also protects the consumers
- APrice ceiling
51An increase in demand leads to an increase in both equilibrium price and quantity. Vice versa
- ATrue
- BFalse
52An increase in supply lowers equilibrium prices and raises equilibrium quantity. Vice versa
- ATrue
- BFalse
53LAW OF DEMAND is when the price of a good is lowered, more of it is demanded; when it is raised, less is demanded. Ceteris paribus
- ATrue
- BFalse
54schedule of quantities that a person would purchase at different prices
- AINDIVIDUAL DEMAND
- BMARKET DEMAND
55schedule of quantities that everyone in the market would buy at different prices
- AMARKET DEMAND
- BINDIVIDUAL DEMAND
56An increase in the quantity people are willing and able to buy at different prices
The product is more desirable than before- AIncrease in Demand
- BDecrease in Demand
57What causes changes in demand?
- AChanges in Income
- BChanges in the Prices of Related Goods and Services
- CChanges in Tastes and Preferences
- DChanges in Price Expectations
- EChanges in population
- FChanges in Demand
- GChanges in Supply
58when the price of a good is increased, more of it is produced; when it is decreased, less is supplied. Ceteris paribus
- ALaw of Demand
- BLaw of Supply
- CDemand Curve
59[blank_start]Individual Supply[blank_end] is the supply schedule of a single firm
- AIndividual Supply
60[blank_start]Market supply[blank_end] is the sum of the supply schedules of all the individual firms in the industry
- AMarket supply
61What causes changes in SUPPLY? (7)
- AChanges in the Cost of Production
- BTechnological Advancement
- CPrices of Other Goods
- DChange in the Number of Suppliers
- EChanges in Taxes
- FExpectation of Future Price Changes
- GRandom Causes
- HChanges in Price Expectations
- IChanges in population
62A measure of how much of the quantity demanded responds to a change in price
- AElasticity
- BElasticity of demand
- CDemand
63[blank_start]Price Elasticity of Demand[blank_end] Is the degree of responsiveness of quantity demanded to a change in price
- APrice Elasticity of Demand
64[blank_start]Inelastic[blank_end] The Qd is not responsive to price changes
- AInelastic
65[blank_start]Elastic[blank_end] The Qd is responsive to price changes
- AElastic
66[blank_start]Unitary Elastic[blank_end] The Qd is equally responsive to price changes
- AUnitary Elastic
67ELASTIC if there is a close substitute.
INELASTIC if there is no close substitute- ATrue
- BFalse
68what makes demand elastic?
- AClose substitutes are available
The price of a product is high relative to buyer’s income
Time passage
Variety of usage - BClose substitutes are not available
The price of a product is low relative to buyer’s income
Time passage
Variety of usage
- AClose substitutes are available
69[blank_start]Advertising[blank_end] attempts to change the way we think about a product.
- AAdvertising
70when demand is elastic, if we were to raise price, TR would fall.
- ATrue
- BFalse
71When demand is inelastic, if we were to raise price, TR would rise
- ATrue
- BFalse
72[blank_start]Income Elasticity of Demand[blank_end] Degree of responsiveness of a percentage change in quantity demanded with a percentage change in income
- AIncome Elasticity of Demand
73[blank_start]Cross Elasticity of Demand[blank_end] The degree of responsiveness of a percentage change in the quantity of a good with a percentage change in the price of other goods
- ACross Elasticity of Demand
74[blank_start]Price Elasticity of Supply[blank_end] The relationship of quantity supplied to change in price
- APrice Elasticity of Supply
75 is the time immediately after a change in market price during which sellers can’t respond by changing the quantity supplied
- ALong run
- BThe Market Period
- CShort run
76A firm has a fixed productive capacity.
- AThe Market Period
- BShort run
- CLong run
77 there is a sufficient time for a firm to alter its productive capacity, it can leave the industry, and new firms can enter the industry.
- AShort run
- BLong run
- CMarket Period
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- Basic Microeconomics Quiz on Quiz for Basic Microeconomics, created by PANGAN, MICHELLE ANNE on 13/10/2022.
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- PANGAN, MICHELLE ANNE
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- English
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