This quiz works best with JavaScript enabled. Home > Agriculture > Economics > Production > Production Economics – Quiz 15 🏠 Homepage 📘 Download PDF Books 📕 Premium PDF Books Production Economics Quiz 15 (30 MCQs) Quiz Instructions Select an option to see the correct answer instantly. 1. The financial director of a company adds up the cost for the firm of rent, insurance, new machinery and the chief executive's basic salary. The director then divides that total by the firm's output. What has the director calculated? A) Average fixed cost. B) Average variable cost. C) Average revenue. D) Average total cost. Show Answer Correct Answer: A) Average fixed cost. 2. A short run production function is one in which- A) At least one factor is fixed. B) At least one factor is variable. C) All factors are fixed. D) All factors are variable. Show Answer Correct Answer: A) At least one factor is fixed. 3. Money used to re-invest in a firm and further its business objectives A) Physical Capital. B) Investment Capital. C) Human Capital. D) Enterprise Capital. Show Answer Correct Answer: B) Investment Capital. 4. Opportunity Cost is best defined as A) The amount of debt you take on by making a decision. B) The price you pay to purchase something. C) The value of the next best alternative that is given up due to the choice you made. D) The benefit you gain by making a decision. Show Answer Correct Answer: C) The value of the next best alternative that is given up due to the choice you made. 5. Which of the following is NOT one of the 4 Factors of Production? A) Land. B) Government. C) Labor. D) Capital. Show Answer Correct Answer: B) Government. 6. Which of the following is NOT one of the PPF model's assumptions? A) The model focuses on production during a given time period. B) The resources available are fixed in quantity and quality. C) The model focuses only on consumer goods. D) Available technology does not change during a given time period. Show Answer Correct Answer: C) The model focuses only on consumer goods. 7. The average fixed cost is equal to the A) Total variable cost divided by total output. B) Total fixed cost divided by total output. C) Total cost divided by total output. D) Marginal cost divided by total output. Show Answer Correct Answer: B) Total fixed cost divided by total output. 8. The price of a good multiplied by the quantity of that good sold is ..... A) Change in Demand. B) Total Revenue. C) Supply Curve. D) Surplus. Show Answer Correct Answer: B) Total Revenue. 9. Which of the following would macroeconomics study? A) A general rise in prices. B) A decline in coffee prices. C) The success rate of sandwich shops. D) The work habits of students. Show Answer Correct Answer: A) A general rise in prices. 10. In the short run production function, as the quantity of variable factor is increased the output also increases but after a certain point output ..... A) Also increases. B) Doesn't effect. C) Starts being constant. D) Declines. Show Answer Correct Answer: D) Declines. 11. Labor, human capital, entrepreneurship, natural resources, and capital are all examples of which of the following? A) Substitutes in Production. B) Factors of Production. C) Outputs. D) Absolute Advantage. Show Answer Correct Answer: B) Factors of Production. 12. The amount a firm receives for the sale of its output. P x Q = ..... A) Profit. B) Total Revenue. C) Average Profit. D) Marginal Revenue. Show Answer Correct Answer: B) Total Revenue. 13. The AC curve is always pierced at its minimumpoint by a rising MC curve A) By a rising MC curve. B) By a falling MC curve. C) By a constant average variable curve. D) None of the above. Show Answer Correct Answer: A) By a rising MC curve. 14. When many workers specialize and help perform an individual task that results in a finished product. A) Productivity. B) Labor force. C) Division of labor. D) None of above. Show Answer Correct Answer: C) Division of labor. 15. When MC > AC, it is A) Pulling down AC. B) None of the above. C) Pulling up AC. D) MRS will have a U-shaped curve. Show Answer Correct Answer: C) Pulling up AC. 16. Because of scarcity, people are forced to make ..... about how to use resources. A) Choices. B) Desires. C) Houses. D) Opportunities. Show Answer Correct Answer: A) Choices. 17. What is a firm's goal? A) To maximize profit. B) Run a profitable Ponzi scheme. C) Create a new form of bacon soap. D) Increase labor. Show Answer Correct Answer: A) To maximize profit. 18. Which resource would be considered the factor of production called land? A) A factory. B) Timber (wood). C) Money. D) A farmer working their fields. Show Answer Correct Answer: B) Timber (wood). 19. The concept of taskhir implies that A) Producers are free to manipulate the natural resources made available to them by Allah. B) Producers have been given the ability to manipulate the natural resources by Allah. C) Producers should avoid damaging the earth with pollution and imbalanced ecosystem management. D) Producers should produce goods and services that preserve the five fundamentals of daruriyyat. Show Answer Correct Answer: B) Producers have been given the ability to manipulate the natural resources by Allah. 20. What is the definition of the economic term Opportunity Cost? A) The benefit you gain by making a decision. B) The value of the next best alternative that is given up due to the choice you made. C) The amount of debt you take on by making a decision. D) The price you pay to purchase something. Show Answer Correct Answer: B) The value of the next best alternative that is given up due to the choice you made. 21. Revenue generated by producing one additional unit of product. A) Average Revenue. B) Total Revenue. C) Marginal Profit. D) Marginal Revenue. Show Answer Correct Answer: D) Marginal Revenue. 22. Your Mail lady is an example of ..... A) Land. B) Labor. C) Entrepreneurs. D) Capital. Show Answer Correct Answer: B) Labor. 23. The satisfaction received from using one more unit of a good or service is called A) Opportunity benefit. B) Opportunity cost. C) Marginal cost. D) Marginal benefit. Show Answer Correct Answer: D) Marginal benefit. 24. What is an example of the purchase of a consumer good? A) A farm owner buys a television. B) A farm owner buys additional land. C) A farm owner buys fertiliser for their crops. D) A farm owner buys some farming equipment. Show Answer Correct Answer: A) A farm owner buys a television. 25. What is the amount of a product or service that is available for consumers to buy? A) Demand. B) Supply. C) Scarcity. D) Profit. Show Answer Correct Answer: B) Supply. 26. The concept of khalifah as a successor is reflected in production where A) A producer has the authority to ensure all business activities must be halal. B) Specialization and division of labor take place to enhance efficiency and productivity levels. C) A market mechanism with minimum government intervention is preferred in Islamic economics. D) A producer should not be biased towards profit maximization over Islamic law. Show Answer Correct Answer: A) A producer has the authority to ensure all business activities must be halal. 27. A point inside the PPC indicates A) Full and efficient utilization of resources. B) Inefficient utilization of resources. C) Unemployment. D) Both B & C. Show Answer Correct Answer: D) Both B & C. 28. A person who makes a good or provides a service is called a A) Consumer. B) Producer. C) Provider. D) Customer. Show Answer Correct Answer: B) Producer. 29. Some agricultural co-operatives have changed from labour-intensive to capital-intensive methods of production. What might be a cause of this change? A) Average productivity of agricultural workers has increased. B) Farming equipment has become more efficient. C) People are eating less food for health reasons. D) Some agricultural land has been sold for housing. Show Answer Correct Answer: B) Farming equipment has become more efficient. 30. There has been a move away from labour-intensive to capital-intensive production in developed economies. Which type of activity remains labour-intensive? A) Manufacturing steel. B) Farming cereals. C) Assembling cars. D) Designing clothes. Show Answer Correct Answer: D) Designing clothes. ← PreviousNext →Related QuizzesEconomics QuizzesAgriculture QuizzesProduction Economics Quiz 1Production Economics Quiz 2Production Economics Quiz 3Production Economics Quiz 4Production Economics Quiz 5Production Economics Quiz 6Production Economics Quiz 7Production Economics Quiz 8 🏠 Back to Homepage 📘 Download PDF Books 📕 Premium PDF Books