ECONOMICS PRACTICE QUIZ

Scarcity causes economic problem. Which of the following statements is true about scarcity?

• Scarcity is our inability to satisfy all of our wants.
• Scarcity problem arises because our wants are greater than resources available.
• The poor and the rich both face scarcity.
• All of the above.

The night before an economics test, you decide to go to the movies instead of studying for the test. You get 50% for the test – not the 70% you normally score. What was the opportunity cost of your evening at the movies?

• 50%
• 70%
• 20%
• Nil.

  Which of the following statements is incorrect?

•   The marginal cost of a good is the opportunity cost of producing one more unit of it.
• As the opportunity cost of producing more goods increases, the marginal cost of producing the good decreases.
• The marginal cost of a good or service is the change in cost resulting from producing one more unit of it.
• The marginal benefit of a good or service is the change in benefit resulting from producing one more unit of it.

Macroeconomics theory studies determine the following EXCEPT;

• The equilibrium income in an economy

• Types and quantities of goods produced

• The unemployment and inflation rate

• International trade activities

Which of the following means “individual could not meet all needs with limited resources"?

• Scarcity

• Choices

• Scarcity

• Desire

Which the following does NOT illustrate opportunity cost?

• If I spent more on food, I must spend less on clothes.

• If I buy computer, I could nit own on a 29” television.

• If I study today, I must give up going to the football game.

• If I buy book, I also can buy new shoes.

Microeconomics is concerned with _____________________.

• the entire economics system.

• specific units of the economics system.

• the changes in the overall level of economic activities.

• stimulating economic growth.

The economic problems of scarcity refer to _______________.

• limited wants and limited resources.

• unlimited wants and unlimited resources.

• unlimited wants and limited resources.

• limited wants and unlimited resources.

Economics is defined as ___________________.

• a study of social science that studies man’s behavior in the distribution of limited factors of production.

• a study if the behavior of individuals in the determination of the optimum level of production at the minimum cost.

• the science of wealth in a community, focus on the distribution of factors production an income.

• a study of social science that focuses on behavior of individuals in the allocation of limited production factors to fulfill unlimited wants.

Opportunity cost is defined as ________________.

• the cost of the second best option that will have to be forgone in order to select the best option.

• the fixed cost involved in the short term.

• the cost used in a factor of production.

• the cost related to the optimum level of production.