Revision Quiz - Basic Economic Problems

Which of the following is NOT a factor of production?

• Labour

• Technology
• Entrepreneurship
• Capital

Which factor of production refers to natural resources?

• Land
• Labour

• Capital
• Entrepreneurship

What does human capital refer to?

• Physical assets owned by a company.
• Government regulations on labor practices.
• Knowledge, skills, and abilities possessed by individuals.
• The amount of money a person earns.

Entrepreneurship involves:

• Identifying opportunities, taking risks, creating value, and managing resources.
• Overlooking opportunities, embracing risks, devaluing resources, and misallocating resources.
• Following trends, playing it safe, diminishing value, and squandering resources.
• Ignoring opportunities, avoiding risks, destroying value, and mismanaging resources.

Opportunity cost is:

• The cost of the most expensive alternative
• The total cost of an action
• The cost of the least expensive alternative
• The value of the next best alternative that must be forgone in order to pursue a certain action.

The concept of opportunity cost is important for:

• Only businesses

• Only individuals

• Both individuals and businesses

• Only governments

Choosing between spending time on study or playing Football is an example of:

• Marginal cost

• Fixed cost

• Variable cost

• Opportunity cost

A point inside the PPC curve represents

• Inefficient allocation of resources
• Efficient allocation of resources
• Maximum production capacity
• Optimal resource utilization

A point outside the PPC curve represents

• Optimal output
• Unattainable combination
• Efficient use of resources
• Inefficient production

An outward shift in the PPC indicates

• Increase in the economy's potential output
• Decrease in the economy's potential output
• No change in the economy's potential output
• Increase in the economy's unemployment rate