Economic Decision-Making Quiz

What is economic decision-making?

• The process of making choices based on emotions rather than logic

• The process of making random choices without considering the consequences

• The process of making choices without considering the benefit

• The process of making choices about how to allocate resources in order to maximize the benefit

What is the goal of economic decision-making?

• To maximize consumers’ satisfaction from consuming a good or a service

• To maximize profits for businesses

• To minimize costs for individuals

• To maximize government revenue

Who are internal decision-makers in a company?

• Individuals who have no authority to make decisions on behalf of the company

• Individuals or organizations outside the company who make decisions that affect the company

• Investors, customers, or bankers

• Individuals within a company or organization who decide whether to sell a particular product, to enter a certain market, to hire or fire employees, or to invest in certain fields

What is a benefit in economic decision-making?

• The expected costs of a proposed project

• The financial costs of a project

• The reward we get for making decisions

• The cost we give up once the decision is made

What is a cost-benefit analysis?

• A process that helps determine whether a project is beneficial for the individual or the company

• A process that helps determine whether a project is harmful for the individual or the company

• A process that helps determine the financial costs of a project

• A process that helps determine the expected costs of a proposed project

What is the benefit-cost ratio used for in economic decision-making?

• To determine the importance of a project

• To determine the expected costs of a proposed project

• To evaluate the factors that are important for a project

• To predict all variables that might affect the decision

What are the limitations of cost-benefit analysis?

• It is not suitable for long-term projects

• It is not suitable for short-term projects

• It is not based on estimates and easy to predict all variables that might affect the decision

• It is based on estimates and difficult to predict all variables that might affect the decision

What is the PACED model used for in economic decision-making?

• To determine the importance of a project

• To predict all variables that might affect the decision

• To calculate the financial costs and benefits of a project

• To evaluate a project in a systematic way

What does the 'P' stand for in the PACED model?

• Problem

• Possible choices

• Criteria

• Evaluate

What does the 'A' stand for in the PACED model?

• Possible choices

• Evaluate

• Criteria

• Problem