Economics and Decision-Making Quiz

What is the primary reason we are forced to make choices every day?

• Because we have too many options

• Because resources are unlimited

• Because time and energy are scarce

• Because prices are always high

What does the term 'opportunity cost' refer to?

• The cost of delivery fees

• The cost of taxes on goods

• The cost of the next best alternative you give up

• The cost of the item you purchase

What is the main benefit of understanding opportunity costs?

• It allows for better allocation of resources

• It increases the number of choices available

• It helps in making decisions based solely on price

• It reduces the need for decision-making

In the context of marginal thinking, what does 'marginal' mean?

• The total cost of all decisions

• The additional cost or benefit of the next decision

• The average cost of decisions

• The fixed cost of a decision

Why might a pizza shop decide not to fulfill an order placed just after closing time?

• They have a policy against late orders

• They have run out of ingredients

• They want to save energy

• The marginal cost is too high compared to the benefit

What is an example of an incentive in economic terms?

• A tax increase on goods

• A product recall

• A free delivery offer

• A price increase

How can high taxes on pizza affect local businesses?

• They encourage more pizza consumption

• They increase local sales

• They have no effect on sales

• They create a disincentive to buy locally

How do incentives influence consumer behavior?

• They have no impact on decisions

• They always lead to increased spending

• They encourage or deter certain behaviors

• They make decisions more complex

What does 'ceteris paribus' mean in economic analysis?

• All other things being equal

• All decisions are fixed

• Only price is considered

• All variables are considered

Why is it important to change only one variable at a time in an experiment?

• To save time

• To increase complexity

• To confuse competitors

• To isolate the effect of that variable