Question 1

The subject matter of economics is concerned with
A)Production
B)Consumption
C)Distribution and exchange
D)All of the above

Accepted Answer

Economics is the study of production, consumption, distribution, and exchange of goods and services.

Question 2

The wants of the people are
A)Limited
B)Satiable
C)Unlimited
D)All of the above

Accepted Answer

The wants of the people are considered unlimited because as soon as one want is satisfied, another emerges. Human desires and needs continue to grow and evolve, making them essentially endless.

Question 3

Which one of the following is an example of an economic good
A)Sunlight
B)Air
C)Petrol
D)None of the above

Accepted Answer

Petrol is an economic good because it is scarce and requires human effort to produce.

Question 4

Production is said to be efficient when:
A)The re-allocation of resources cannot increase the production o the article even by one unit
B)More output is produced with the given input
C)Resources are fully employed
D)All of the above

Accepted Answer

The answer of Production is said to be efficient when:
A)The...

Question 5

Economics is a social science because
A)The central point in economics is man and his problems
B)Economics uses scientific approach to derive its laws
C)Like History, Politics and Psychology economics deals with the problems of human being
D)All of the above

Accepted Answer

Economics is considered a social science because it focuses on human behavior and societal problems, employs scientific methods to formulate laws and theories, and, like other social sciences such as history, politics, and psychology, it addresses issues related to human beings and their interactions.

Question 6

Marginal product of a factor is
A)The additional product received by the firm due to the employment of an additional unit of a variable factor
B)Addition to the total product when one more unit of a factor is employed
C)The rate of change in the total product per unit change in the variable factor.
D)All of the above

Accepted Answer

All the statements A, B, and C accurately describe the concept of the marginal product of a factor, which is the additional output a firm gains by employing one more unit of a variable factor.

Question 7

Production function expresses
A)The relationship between input and output
B)How maximum output is produced with the given input
C)What is the least-cost combination of input to produce the given output
D)All of the above

Accepted Answer

The production function expresses all of these aspects: the relationship between input and output, how maximum output is produced with the given inputs, and the least-cost combination of inputs to produce a given output.

Question 8

At the 'point of inflection'
A)MP is maximum
B)AP is maximum
C)TP is maximum
D)All of the above

Accepted Answer

At the point of inflection, the Marginal Product (MP) is at its maximum, indicating the highest rate of change of the Total Product (TP).

Question 9

Economies of scale refers to:
A)Advantages resulting from large scale production
B)Disadvantages resulting from large scale production
C)Advantages resulting from the increase in the number of consumers
D)All of the above

Accepted Answer

Economies of scale refer to the cost advantages that enterprises obtain due to their scale of operation, with cost per unit of output generally decreasing with increasing scale as fixed costs are spread out over more units of output.

Question 10

The law of Diminishing returns is applicable to:
A)Agriculture only
B)Industry only
C)In short-run only
D)Universally

Accepted Answer

The law of diminishing returns is a universal economic principle that applies to all production processes, regardless of the industry or time frame.

Question 11

Let a firm employs 5 labourers and produces 120 units of output. When 6 labourers are employed the firm produces 136 units of output. Then the marginal product is ---
A)120
B)136
C)6
D)16

Accepted Answer

The marginal product is the additional output produced when one more unit of input (in this case, a laborer) is employed. It is calculated as the change in output divided by the change in input. Here, the change in output is 136 - 120 = 16 units, and the change in input is 6 - 5 = 1 laborer. Therefore, the marginal product is 16 units per laborer.

Question 12

A firm produces 200 units of commodity X by employing 10 workers and 240 units of the same commodity by employing 12 workers. Then the Average Product of the worker is --------
A)200
B)240
C)20
D)40

Accepted Answer

The Average Product (AP) of a worker is calculated by dividing the total output by the number of workers. For 200 units produced by 10 workers, AP = 200/10 = 20. Similarly, for 240 units produced by 12 workers, AP = 240/12 = 20. Thus, the average product per worker is 20.

Quiz 1: Economics: Concepts, Problems, and Analysis

The subject matter of economics is concerned with

The wants of the people are

Which one of the following is an example of an economic good

Production is said to be efficient when:

Economics is a social science because

Marginal product of a factor is

Production function expresses

At the 'point of inflection'

Economies of scale refers to:

The law of Diminishing returns is applicable to:

Let a firm employs 5 labourers and produces 120 units of output. When 6 labourers are employed the firm produces 136 units of output. Then the marginal product is ---

A firm produces 200 units of commodity X by employing 10 workers and 240 units of the same commodity by employing 12 workers. Then the Average Product of the worker is --------