Economics Multiple Choice Quiz

What is the science of Economics?

• Study of history

• Study of money

• Study of how we use limited resources

• Study of voting behavior

How do you understand scarcity?

• Having too many products

• Unlimited resources

• Limited resources and unlimited wants

• No use for resources

What is opportunity cost?

• Cost of labor

• The money spent

• The next best alternative given up

• The discount received

What is the difference between wants and needs?

• Wants are necessary; needs are not

• Needs are necessary; wants are extra

• They are the same

• Needs are more expensive

Which of the following is an example of market specialization?

• A bakery only making bread

• A farmer growing every crop

• A store selling all products

• Everyone doing every job

The 'law of demand' suggests that...

• Higher price = higher demand

• Price has no effect

• Lower price = higher demand

• Demand increases supply

The 'law of supply' suggests that...

• Higher price = higher supply

• Higher price = lower supply

• Price does not matter

• Supply stays the same

What is the difference between macroeconomics and microeconomics?

• Macro = individual, Micro = global

• Macro = small, Micro = big

• Macro = whole economy, Micro = individuals

• No difference

Which of the following is an economic system?

Why do companies study price elasticity?

• To raise taxes

• To cut wages

• To understand how price affects sales

• To pay suppliers more