This quiz works best with JavaScript enabled. Home > Economics > Production > Production Economics – Quiz 21 🏠 Homepage 📘 Download PDF Books 📕 Premium PDF Books Production Economics Quiz 21 (20 MCQs) Quiz Instructions Select an option to see the correct answer instantly. 1. A person who purshases ( buys) and uses a good or service A) Communism. B) Capital. C) Consumer. D) None of above. Show Answer Correct Answer: C) Consumer. 2. The basic economic conditions that exist when unlimited wants exceed limited productive resources is called A) Capital. B) Scarcity. C) Economics. D) Factors of production. Show Answer Correct Answer: B) Scarcity. 3. What does a high Depreciation value indicate? A) That the NNP is only low. B) That the GNP is only low. C) That the GNP and NNP are both low. D) There is poor economic growth. Show Answer Correct Answer: D) There is poor economic growth. 4. What is it called to move goods and services directly to or near consumers? A) Production. B) Consumption. C) Distribution. D) None of above. Show Answer Correct Answer: C) Distribution. 5. Tony opens up a hot chocolate stand for two hours. He spends £10 for ingredients and sells £60 worth of tasty beverages. In the same two hours, he could have provided Uber services (illegally because he isn't 18) and earned £40. Tony's accounting profit is ..... and his economic profit is ..... A) £50, £10. B) £90, £50. C) £10, £50. D) £50, £90. Show Answer Correct Answer: A) £50, £10. 6. The amount a firm receives for the sale of its output. A) Profit. B) Total Revenue. C) Marginal Revenue. D) Average Profit. Show Answer Correct Answer: B) Total Revenue. 7. Which of the following is the Marginal Cost formula? A) Change in TC/ Change in output. B) Change in P/Change in Q. C) Change in VC/Change in output. D) Both Change in TC/ Change in output & Change in VC/Change in output. Show Answer Correct Answer: D) Both Change in TC/ Change in output & Change in VC/Change in output. 8. Suppose that a new machine that speeds up automotive production is introduced into the auto industry. This would cause the PPF to A) Shift outward. B) Shift inward. C) Do nothing. D) Not enough information is provided. Show Answer Correct Answer: A) Shift outward. 9. What is the term for mutual dependence between people or countries? A) Co-Dependence. B) Co-Ownership. C) Independence. D) Interdependence. Show Answer Correct Answer: D) Interdependence. 10. What is revenue? A) All income that a business receives over a period of time; government income. B) The money a company pays out. C) The money a company pays its employees. D) The money a company loses. Show Answer Correct Answer: A) All income that a business receives over a period of time; government income. 11. In general, it is a bad move for a company to produce more of a good or service if, by doing so A) Marginal cost exceeds marginal revenue. B) Variable costs exceed fixed costs. C) Demand exceeds supply. D) Fixed costs exceed marginal revenue. Show Answer Correct Answer: A) Marginal cost exceeds marginal revenue. 12. Additional cost associated by producing one additional unit of product. A) Fixed Costs. B) Average Costs. C) Marginal Costs. D) Emplicit Costs. Show Answer Correct Answer: C) Marginal Costs. 13. I went to college right out of high school and did not get a full time job until four years later. What was the biggest cost to go to college? A) The tuition. B) Books. C) Missing my family. D) The money I didn't make at the job I didn't have. Show Answer Correct Answer: D) The money I didn't make at the job I didn't have. 14. The physical effort of the manpower to produce the basic needs of the consumers, describes which factor of production? A) Land. B) Labor. C) Capital. D) Entrepreneur. Show Answer Correct Answer: B) Labor. 15. Should our government use limited resources to build a post office, repair a bridge, or build a new park? What is the economic question asked? A) Why is this being produced?. B) How is it produced?. C) Who will consume these goods and services?. D) What is produced?. Show Answer Correct Answer: D) What is produced?. 16. What is meant by 'enterprise' in economics? A) Hard physical work used to produce manufactured goods. B) Natural resources used in the productive process. C) Human mental and physical effort used for producing goods and services. D) Risk taking and organizing the factors of production. Show Answer Correct Answer: D) Risk taking and organizing the factors of production. 17. The law of diminishing marginal returns states that A) As more of a variable input is used, while other inputs and technology are fixed, the average product of the variable input will increase. B) As more of a variable input is used, while other inputs and technology are fixed, the marginal product of the variable input will eventually decrease. C) As more of a variable input is used, while other inputs and technology are fixed, the average product of the fixed input will eventually decrease. D) As more of a fixed input is used, while other inputs and technology are variable, the marginal product of the variable input will eventually increase. Show Answer Correct Answer: B) As more of a variable input is used, while other inputs and technology are fixed, the marginal product of the variable input will eventually decrease. 18. The goods used in the production process such as factories, machinery and equipment A) Land. B) Labor. C) Resources. D) Capital. Show Answer Correct Answer: D) Capital. 19. Iron, minerals, coal and plants are examples of which productive resource? A) Land. B) Labor. C) Entrepreneurship. D) Capital. Show Answer Correct Answer: A) Land. 20. Who makes the decisions on how goods and services will be produced in a command economy? A) Individuals. B) The government and individuals. C) The Government. D) Traditions and culture. Show Answer Correct Answer: C) The Government. ← 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