Tuesday, April 16, 2019

LET REVIEWER SOCIAL STUDIES - Microeconomics


SOCIAL STUDIES/ SOCIAL SCIENCE REVIEWER - Microeconomics


Choose the best answer.

1. When fixed costs are ignored because they are irrelevant to a business's production decision, they are called _________ costs.
A. prospective
B. opportunity
C. sunk
D. marginal

2. If the price elasticity of supply is 1.2, and price increased by 5% , quantity supplied would ______.

A. increase by 6%
B. decrease by 24
C. increase by 24
D. decrease by 6%

3. An improvement in technology will shift the __________ curve to the _____________.

A. demand; up
B. demand; down
C. supply; right
D. supply; left

4. If goods A and B are compliments then an increase in the price of good A will ______ of good B.

A. increase the demand
B. decrease the demand
C. increase the supply
D. decrease the supply

5. The value of a business owner's time is an example of _______.

A. implicit cost
B. marginal cost
C. explicit cost
D. opportunity cost

6. Economics primarily deals with the concept of _______.

A. surplus
B. profit
C. money
D. scarcity

7. Consumers buy Starbucks coffee regardless of its change in prices. This implies that Starbucks coffee has a perfectly _______.

A. inelastic price
B. inelastic demand
C. elastic supply
D. elastic demand

8. Foregone rent on office space owned and used by the firm is an example of what kind of cost?

A. fixed
B. variable
C. opportunity
D. implicit

9. A firm that shuts down temporarily has to pay its ________.

A. fixed costs but not its variable costs
B. fixed costs and its variable costs
C. variable costs but not its fixed costs
D. opportunity costs only

10. Diseconomies of scale occur when ________.

A. short-run average total costs rise as output decreases
B. long-run average total costs falls as output increases
C. long-run average total costs rise as output increases
D. short-run average total costs falls as output increases

11. The difference between accounting profit and economic profit is ______.

A. implicit costs
B. marginal costs
C. net profit
D. opportunity

12. Total revenue equals _________.

A. gross profit minus total cost
B. price times quantity
C. total assets minus total liabilities
D. total cost minus opportunity cost

13. What is the fundamental basis for trade among nations?

A. foreign exchange
B. balance of trade
C. comparative advantage
D. low tariff

14. If Adam Smith is the father of economics, the founding father of macroeconomics is _________.

A. Peter Drucker
B. David Ricardo
C. John Maynard Keynes
D. Thomas Malthus

15. The decrease in total surplus that results from a market distortion, such as a tax, is called a/an ___________.

A. deadweight loss
B. implicit cost
C. opportunity cost
D. externality

16. It is a concept developed by Adam Smith to describe the virtues of free markets.

A. Laissez-faire
B. Economics
C. Capitalism
D. Invisible hand

17. The difference between the buyer's reservation price and the price he or she actually pays.

A. Discount Price
B. Buyer's Surplus
C. Ceiling Price
D. Cash on the Table

18. The demand for a good is elastic with respect to price if its price elasticity of demand is ______ 1.

A. equal to
B. lesser than
C. greater than
D. at least

19. A tax that collects the same amount from every taxpayer.

A. Income tax
B. Value-added tax
C. Ad valorem tax
D. Head tax

20. It refers to a good whose demand curve shifts leftward when the incomes of buyers increase.

A. Inferior Good
B. Complement Good
C. Substitute Good
D. Normal Good

21. Hilda was very excited when she opened her graduation gifts and found out that it was a Barbie doll. However, her excitement waned when she opened the remaining boxes and they also contained Barbie dolls. This situation illustrates the __________.

A. Law of Diminishing Returns
B. Law of Diminishing Marginal Utility
C. Law of Supply and Demand
D. Law of Self-interest

22. A term increasingly used to connote having services performed by low-wage workers overseas.

A. Outsourcing
B. Offshoring
C. Nearshoring
D. Sweatshop

23. A public expenditure that is larger than the total benefit it creates but that is favored by a legislator because his or her constituents benefit from the expenditure by more than their share of the resulting extra taxes.

A. Mandatory Spending
B. Pork Barrel Spending
C. Discretionary Spending
D. Appropriation Bill

24. It is a curve that plots the relationship between the quantity of x consumed and income.

A. Supply & Demand curve
B. Price-consumption curve
C. Marshallian demand curve
D. Engel curve

25. "Greatest happiness for the greatest number"

A. Utilitarianism
B. Communism
C. Humanism
D. Gestalt

ANSWERS