This quiz works best with JavaScript enabled. Home > Economics > Production > Production Economics – Quiz 1 🏠 Homepage 📘 Download PDF Books 📕 Premium PDF Books Production Economics Quiz 1 (20 MCQs) Quiz Instructions Select an option to see the correct answer instantly. 1. There are very little personal freedoms when it comes to resources and decisions about what to sell and how to sell it.Which economic system does this represent? A) Mixed. B) Command. C) Traditional. D) Market. Show Answer Correct Answer: B) Command. 2. A country produces $ 12 billion worth of goods, $ 7 billion worth of services overall. If the amount they spent on depreciation is $ 380 million, what is the country's NNP? A) $ 19 billion. B) $ 5 billion. C) $ 84 billion. D) $ 18.62 billion. Show Answer Correct Answer: D) $ 18.62 billion. 3. An individual's knowledge or skills that make production of a good/service more efficient A) Human Capital. B) Physical Capital. C) Investment Capital. D) Enterprise Capital. Show Answer Correct Answer: A) Human Capital. 4. A delivery driver A) Natural Resource. B) Human Resource. C) Capital Resource. D) Entrepreneurship. Show Answer Correct Answer: B) Human Resource. 5. The best definition of economies of scale is A) Average revenue rises as output rises. B) Total costs rise as output increases. C) Total costs fall as output rises. D) Average cost falls as the scale of output increases. Show Answer Correct Answer: D) Average cost falls as the scale of output increases. 6. Which of the following is NOT one of the 3 Basic Economic questions? A) What To Produce. B) When to Produce. C) How to Produce. D) For Whom To Produce. Show Answer Correct Answer: B) When to Produce. 7. How do you satisfy your unlimited wants in a world of limited resources? A) By making more money. B) By making choices. C) By stealing. D) By setting a budget. Show Answer Correct Answer: B) By making choices. 8. Which should not be considered as capital? A) A share of corporate stock. B) An automobile used by a person. C) A crane used by a building contractor. D) A razor used by a barber. Show Answer Correct Answer: A) A share of corporate stock. 9. The pattern of demand for silk and gold by men should be ..... A) Zero. B) Infinitive. C) Decrease to one. D) More than zero but less than one. Show Answer Correct Answer: A) Zero. 10. To "use again" A) Depletion. B) Reduce. C) Recycle. D) None of above. Show Answer Correct Answer: C) Recycle. 11. A herd of cattle is an example of A) Land. B) Labor. C) Entrepreneurship. D) Capital. Show Answer Correct Answer: A) Land. 12. The break-even level of output is that number of units where: A) Profit is at its highest level. B) Variable costs equal revenue. C) Total costs equal revenue. D) Variable costs equal fixed costs. Show Answer Correct Answer: C) Total costs equal revenue. 13. What is classified as one of the four economic resources? A) Consumption. B) Enterprise. C) Production. D) Trade. Show Answer Correct Answer: B) Enterprise. 14. This factor involves money, equipment, and tools and any items to produce goods and services? A) Capital. B) Entrepreneur. C) Land. D) Labor. Show Answer Correct Answer: A) Capital. 15. When the amount of a factor increases the total output A) Decreases. B) Is maximum. C) Increases. D) Becomes zero. Show Answer Correct Answer: C) Increases. 16. In determining the optimal level of output, a firm should aim for the A) Point where decreasing returns become negative returns. B) Output level where fixed costs exceed variable costs. C) Point of maximum profitability for the company. D) Output level where marginal returns are still increasing. Show Answer Correct Answer: C) Point of maximum profitability for the company. 17. Entrepreneurs are considered a factor of production because? A) They are land owners. B) They are great workers at factories. C) Provide money by investing. D) They create companies and foster business innovation by having creative ideas. Show Answer Correct Answer: D) They create companies and foster business innovation by having creative ideas. 18. Capital refers to A) The "gifts of nature" or natural resources not created by human effort. B) People with all their efforts and abilities. C) The tools, equipment, and factories used in production of goods and services. D) Individuals who start a new business or bring a product to market. Show Answer Correct Answer: C) The tools, equipment, and factories used in production of goods and services. 19. The enterprising spirit that allows an individual to spot gaps in the market and take risks (including starting a business): A) Entrepreneurship. B) Capital. C) Land. D) Labor. Show Answer Correct Answer: A) Entrepreneurship. 20. What does the saying "There is no free lunch" mean? A) Some things cost nothing. B) Most things cost nothing. C) Most things cost something. D) Everything costs something. Show Answer Correct Answer: D) Everything costs something. Next →Related QuizzesEconomics QuizzesProduction Economics Quiz 2Production Economics Quiz 3Production Economics Quiz 4Production Economics Quiz 5Production Economics Quiz 6Production Economics Quiz 7Production Economics Quiz 8Production Economics Quiz 9Production Economics Quiz 10 🏠 Back to Homepage 📘 Download PDF Books 📕 Premium PDF Books