Economic End of Month Test

Which of the following costs are dependent on the level of output.

i.variable costs

ii. average costs

iii.fixed costs

iv.Total costs

• i and ii only

• i and iii only

• ii and iii only

• ii and iv only

Identify the public goods from the following list.

i.factory building

ii. defence

iii. law and order

iv. street lighting

• i and ii only

• i, ii and iii

• ii, iii and iv only

• All of the above

In economics, when we refer to a market we are speaking of

• a place where only goods are sold, although buyers and seller may never meet.

• a situation where buyers and sellers, interact, to set the price for a product.

• a place where buyers and sellers converge to make arrangements to purchase a good

• a place that allows individuals to express their desire to purchase a good or service.

Which of the following BEST describe total fixed costs curves?

• diagonal line

• vertical line

• horizontal line

• concave line

Which of the following is a major difference between a service and a good?

• a service is intangible while a good is tangible

• a service can be easily transferred while a good cannot

• a service does not provide utility while a good can

• a service is tangible while a good is intangible

Which of the following are costs related to indivisible factors- for example building, machinery and vehicles?

• variable costs

• marginal costs

• decreased costs

• fixed costs

the formula for marginal cost is

• change in total cost $\times$ change in quantity

• change in quantity $\div$ change in total cost

• change in total cost $\times$ change in quantity

• change in total cost $\div$ change in quantity

Which of the following is a variable cost in the short run?

• rent of the factory

• interest payments on borrowed financial capital

• wages paid to factory workers

• salaries paid to upper management

Average Total Costs are calculated by dividing Total Costs by

• Price

• Average Variable Costs

• Quantity or units produced

• Revenue

Variable Cost/Quantity = _______

• Marginal Variable Cost

• Average Variable Cost

• Average Fixed Cost

• Marginal Total Cost