This quiz works best with JavaScript enabled. Home > Economics > Production > Production Economics – Quiz 13 🏠 Homepage 📘 Download PDF Books 📕 Premium PDF Books Production Economics Quiz 13 (20 MCQs) Quiz Instructions Select an option to see the correct answer instantly. 1. Law of variable proportion is also called ..... A) The law of increasing returns. B) The law of diminishing returns. C) The law of constant returns. D) Long run production function. Show Answer Correct Answer: B) The law of diminishing returns. 2. The formula for Average cost is A) Total Cost/ total revenue. B) Total revenue/ output. C) Total Cost/ output. D) Output/total cost. Show Answer Correct Answer: C) Total Cost/ output. 3. ..... is equipment or goods (machinery, tools, factories, stores, vehicles, etc.) that are used to produce other goods and services. A) Human resource. B) Natural resource. C) Capital resource. D) Production. Show Answer Correct Answer: C) Capital resource. 4. David decides to start his own business. He opens a shop that manufactures sports equipment. He pays Frank an hourly wage to make baseball bats, and Gene a salary to manage his finances. Three days after his grand opening, he is ecstatic because Mike, who runs the town's parks and recreation department, calls him and orders equipment for six Little League baseball teams. Which of the following statements is TRUE? A) Davis is a producer, Frank is labor, Gene is the entrepreneur of the business, and Mike has just ordered capital goods. B) David is producer, Frank and Gene are consumers, and Mike has just made an investment. C) David is a the entrepreneur, Frank and Gene are both labor, and Mike is a consumer. D) Frank and Gene are both entrepreneurs, David is the owner, and Mike has just made a capital investment. Show Answer Correct Answer: C) David is a the entrepreneur, Frank and Gene are both labor, and Mike is a consumer. 5. Amanah is one of the most significant values in producer behavior since A) Widespread dishonesty may destroy the functional role of the market. B) Producers have absolute ownership over resources. C) Trust is a sufficient condition to ensure a maximum level of profit. D) Labor must be paid their wage once they have performed their work. Show Answer Correct Answer: A) Widespread dishonesty may destroy the functional role of the market. 6. In farming, what is an example of what economists call capital? A) Savings the farmer has in the bank. B) Shares in a farming company. C) The money the farmer set aside to pay taxes. D) The tractor owned by the farmer. Show Answer Correct Answer: D) The tractor owned by the farmer. 7. Why does scarcity exist? A) Each year workers tend to produce less than previously. B) There are not sufficient resources to meet everyone's wants. C) Machines wear out in time. D) There is a limit to people's wants. Show Answer Correct Answer: B) There are not sufficient resources to meet everyone's wants. 8. WHAT IS LABOR? A) Work people do for pay to produce good and services. B) Actions people do for other people. C) Any physical object. D) The money people get for inheritance. Show Answer Correct Answer: A) Work people do for pay to produce good and services. 9. An economic principle which states that as production shifts from making one good or service to another, more resources are needed to increase production of the second good or service A) Law of increasing costs. B) Efficiency. C) Production possibilities curve. D) Production possibilities frontier. Show Answer Correct Answer: A) Law of increasing costs. 10. Which of the following would consumers MOST OFTEN need to consider when trying to make a rational economic decision? A) The impact of government subsidies. B) Potential opportunity costs. C) Factors of Productions. D) Net Exports. Show Answer Correct Answer: B) Potential opportunity costs. 11. Which economic system is based on economic decisions being made by traditions and cultures? A) Market. B) Traditional. C) Command. D) Mixed. Show Answer Correct Answer: B) Traditional. 12. What are the three economic questions? A) What to produce? How to produce? For whom to produce?. B) Who to produce? Why you produce? Like to produce?. C) Why to produce? Tell who to produce? Things to produce?. D) None of above. Show Answer Correct Answer: A) What to produce? How to produce? For whom to produce?. 13. Variable Cost/Quantity = ..... A) Marginal Variable Cost. B) Average Fixed Cost. C) Average Variable Cost. D) Marginal Total Cost. Show Answer Correct Answer: C) Average Variable Cost. 14. A natural resource was discovered in a country. The exploitation of this resource allowed the country to double its gross domestic product within ten years. Why did this not solve the basic economic problem? A) Exploiting the resource required high expenditure on capital equipment. B) Exploiting the resource caused significant environmental damage. C) Gross domestic product was unevenly distributed in the country. D) Wants still exceeded the resources available to meet those wants. Show Answer Correct Answer: D) Wants still exceeded the resources available to meet those wants. 15. The people who work in both the public and private sector A) Land. B) Labor. C) Entrepreneurahip. D) Capital. Show Answer Correct Answer: B) Labor. 16. What does the saying "There Ain't No Such Thing As A Free Lunch" mean? A) Some things cost nothing. B) Most things cost nothing. C) Most things have a cost. D) Everything costs something. Show Answer Correct Answer: D) Everything costs something. 17. Which items are allowed in production output based on Islam? A) Magazines which are entertainment-oriented and gossip. B) Clothing degrading someone. C) Cough medicines and painkillers. D) The video shows the violent action. Show Answer Correct Answer: C) Cough medicines and painkillers. 18. All the units of a product produced in a give period of time is called ..... A) Average Product. B) Total Product. C) Marginal Product. D) None of these. Show Answer Correct Answer: B) Total Product. 19. Natural gas A) Capital. B) Entrepreneurship. C) Land. D) Labor. Show Answer Correct Answer: C) Land. 20. A company supplying water spent $ 470 million creating a network of pipes to distribute water more efficiently. It employed local workers and boosted the local economy. It also provided better facilities for the tourist industry. What cannot be concluded from the above? A) The company increased its profits. B) There was a decrease in regional unemployment. C) There were fixed costs of $ 470 million. D) There were positive externalities. Show Answer Correct Answer: A) The company increased its profits. ← PreviousNext →Related QuizzesEconomics QuizzesProduction Economics Quiz 1Production Economics Quiz 2Production Economics Quiz 3Production Economics Quiz 4Production Economics Quiz 5Production Economics Quiz 6Production Economics Quiz 7Production Economics Quiz 8Production Economics Quiz 9 🏠 Back to Homepage 📘 Download PDF Books 📕 Premium PDF Books