Production Economics Quiz 17 (20 MCQs)

Quiz Instructions

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1. If variable costs are £6 per unit, then total variable costs of producing 7, 000 units will be:

Correct Answer: D) £42, 000.

2. What can cause a production possibilities curve to move to the right?

Correct Answer: C) A new invention lowers the cost of production.

3. The term, "entrepreneurship" means:

Correct Answer: A) Person who organizes the factors of production to produce goods/services; business owners.

4. A farm is buying tractors to help increase production. Which factor of production are they investing in?

Correct Answer: C) Capital.

5. Which is an example of an economic shortage?

Correct Answer: B) A toy store without dolls.

6. Things you buy and use

Correct Answer: C) Goods.

7. The skills of people who are willing to invest time and money to run a buainess

Correct Answer: D) Entrepreneurship.

8. Which of the following is not an example of land?

Correct Answer: B) Baker.

9. The analyses of the correlation of costs, sales and profit to production and sales volume is known as

Correct Answer: C) Break even analysis.

10. Market activities involve production for the purpose of

Correct Answer: D) All the above.

11. The BEST explanation of why there will always be scarcity is because

Correct Answer: D) While peoples' wants are unlimited, resources are limited.

12. Production possibilities curve in Islamic economic shows those in underdeveloped countries, the production of .....

Correct Answer: C) Luxury goods decreased and necessity good increased.

13. What influences productivity, economic growth, and future standards of living?

Correct Answer: C) Factories, machinery, technology, and education.

14. Which of the following is NOT a reason for economies of scale to exist?

Correct Answer: D) Large firms often have poor communication, which slows down decision making.

15. Which change will make a manufacturing company replace machines with labour to maintain the most efficient combination of factors of production?

Correct Answer: B) The productivity of labour has increased.

16. If costs rise the supply curve shifts:

Correct Answer: B) Left.

17. The physical effort of people to produce goods or services describes which factor of production?

Correct Answer: C) Human Resources.

18. Everything contained in the earth or found in the sea ex:coal and crude oil

Correct Answer: A) Land.

19. An increase in the labor force would cause the PPF to

Correct Answer: B) Shift outward.

20. Human capital includes

Correct Answer: B) The knowledge a taxi driver has of the city streets.