APPLIED ECONOMICS EXAM

APPLIED ECONOMICS EXAM


Those that cannot be readily changed during the time period under consideration except at a very great expense.
Select one:
 a. Inputs
 b. Outputs
 c. Variable Inputs
 d. Fixed Inputs 

An entity organized by people with similar needs to provide themselves with goods or services or to jointly use available resources to improve their income.
Select one:
 a. Cooperative 
 b. Corporation
 c. Sole Proprietorship
 d. Partnership

The combined production of several units of a given set of inputs.
Select one:
 a. Marginal Utility
 b. Marginal product
 c. Total Product 
 d. Total Utility

This includes a look at the population size, the geography of the place where business will be located, land distribution, climate, and today’s global warming situation, whether or not the area is prone to flood or earthquake.
Select one:
 a. Cultures and Lifestyles
 b. Physical Environment
 c. Political Factors
 d. Economic Forces

Production is the transformation of inputs into outputs of goods & services.
Select one:
 True 
 False

It studies the conditions in an industry at a particular time, including the behavior of and relations between competitors, suppliers, and customers.
Select one:
 a. SWOT Analysis
 b. HERFINDAHL-HIRSCHMAN INDEX (HHI)
 c. Industrial analysis 
 d. Environmental Analysis

An equation showing the maximum output of a commodity that a firm can produce per period of time with each set of inputs.
Answer: Production Function

It refers to the additional utility derived from consuming an additional unit of the good.
Select one:
 a. Total product
 b. Marginal Utility
 c. Marginal product
 d. Total Utility

Consumers are a business’ source of raw materials, intermediate goods or final products and services.
Select one:
 True
 False 

This sector processes raw materials from agriculture, fishery and forestry into intermediate products which are further processed into final products.
Select one:
 a. Trade and Transport
 b. Service Sector
 c. Manufacturing 
 d. Industrial Sector 

Production refers to the use of goods and services to satisfy human wants.
Select one:
 True
 False 

These are domestically produced goods sold to foreign countries.
Select one:
 a. Final Goods
 b. Intermediate Goods
 c. Exports 
 d. Imports

Consumer Theory describes how consumers make decisions about what to buy given their income and prices of goods and services.
Select one:
 True 
 False

It refers to the average contribution per unit of input and is equal to TP/i.
Select one:
 a. Total Utility
 b. Marginal Utility
 c. Total Product 
 d. Average Product 

It is a legal entity that is separate from its owners, the shareholders. No shareholder is personally liable for the debts, obligations or acts of the corporation.
Select one:
 a. Sole Proprietorship
 b. Partnership
 c. Cooperative
 d. Corporation 

A Business with total assets worth from P15,000,001 to P60,000,000. Large scale business is one with total assets in excess of P60,000,000.
Select one:
 a. Large Business 
 b. Small Business
 c. Micro Business
 d. Medium Business 

It is a tool that lists the strengths, weaknesses, opportunities, and threats that face the business.
Select one:
 a. HERFINDAHL-HIRSCHMAN INDEX (HHI)
 b. Environmental Analysis
 c. Industrial analysis
 d. SWOT Analysis ✔

Goods that are ready for direct consumption and are then sold to customers for their use.
Select one:
 a. Imports
 b. Intermediate Goods
 c. Final Goods ✔
 d. Exports

The basic facilities, services and installations needed for the functioning of a community or society.
Answer: Infrastructure

The basic consuming unit, makes use of goods and services which are available in the economy.
Answer: Household

It refers to the combined utility derived from consuming certain units of a good.
Select one:
 a. Marginal Product
 b. Marginal Utility 
 c. Total utility
 d. Total Product 

It shows the relationship between utility and consumption.
Answer: Utility Function

It produces the intangibles supporting and complementing production in the other sectors as well as among its own industries.
Select one:
 a. Industrial Sector
 b. Manufacturing
 c. Trade and Transport
 d. Service Sector 

The Law of Diminishing Marginal Utility states that as additional units of a good are consumed, the additional utility derived from each additional unit tends to diminish, while keeping consumption of other goods constant.
Select one:
 True 
 False

Those that can be changed easily and on short notice.
Select one:
 a. Input
 b. Variable Inputs 
 c. Output
 d. Fixed inputs

The commonly accepted measure of market concentration. It is calculated by squaring the market share of each firm competing in a market, and then summing the resulting numbers.
Select one:
 a. Industrial analysis
 b. SWOT Analysis
 c. Environmental Analysis
 d. HERFINDAHL-HIRSCHMAN INDEX (HHI) 

A form of business organization in which two or more persons combine their resources in a business with a view to making profit.
Select one:
 a. Cooperative
 b. Partnership  ✔
 c. Corporation
 d. Sole Proprietorship

t is an aggregation of the different businesses engaged in the same kind of undertaking.
Answer: Affiliated Companies

The term used for satisfaction derived from consuming a good/service.
Answer: Utility

The Law of Diminishing Marginal Returns states that additional output starts to diminish at a certain point as additional units of a variable input are combined with one or more fixed inputs.
Select one:
 True
 False 

A principle or body of principles to guide decisions and achieve rational outcomes.
Answer: Policy

The value of a particular monetary unit in terms of the goods and services that it can buy.
Answer: Purchasing Power

This is undertaking by a person or a group of persons who are partners, or of stockholders who own a juridical entity known as a corporation whose main objective is to earn profit for owners.
Answer: Corporate

A Business with total assets worth from P1,500,001 to P15,000,000.
Select one:
 a. Micro Business
 b. Large Business
 c. Medium Business
 d. Small Business 

Retailers are wholesalers or brokers who buy in big quantities from manufacturers, add a mark-up to their purchase price and sell to distributors.
Select one:
 True 
 False

A business with total assets worth below P1,500,001.
Select one:
 a. Small Business
 b. Medium business
 c. Micro Business 
 d. Large Business

It is the basic producing unit, delivers the goods and services to the household for its consumption.
Answer: Producers

A form of business organization that is owned by a single individual who is singly responsible for running the business and is accountable for all debts and obligations related to the business.
Select one:
 a. Sole Proprietorship 
 b. Cooperation
 c. Corporation
 d. Partnership

The product created as a result of the combination of inputs in the production process.
Select one:
 a. Fixed Inputs
 b. Input
 c. Variable inputs
 d. Output 

A written estimate of anticipated government revenues and expenditures during a specific period of time.
Select one:
 a. National Budget 
 b. International Budget
 c. City Budget
 d. Provincial Budget

Refers to an evaluation of the possible or probable effects of external forces and conditions on the survival and growth of the business.
Answer: Environmental Analysis

These are unprocessed goods like raw materials, logs, and wheat, they are materials extracted from their sources and do not undergo any process of production.
Select one:
 a. Import Goods
 b. Raw Materials 
 c. Final Goods
 d. Intermediate Goods

An act or process of trying to get or win something over one’s rivals.
Answer: Competition

This involves a look at economic factors such as income of the people, specifically the target market, economic conditions such as inflation, recession, prosperity, demand, and supply in the market.
Select one:
 a. Economic Forces 
 b. Physical Environment
 c. Political Factors
 d. Cultures and Lifestyles

Target market refers to the group of customers the business aims to cater to.
Select one:
 True 
 False

The additional output produced by an additional unit of the input and is equal to TP/ i.
Select one:
 a. Marginal Utility
 b. Total product 
 c. Marginal Product 
 d. Total Utility

It refers to goods purchased from a foreign country
Select one:
 a. Final Goods
 b. Intermediate Goods
 c. Exports 
 d. Imports 

A regular payment, usually on an hourly, daily or weekly basis, made by an employer to an employee, especially for manual labor.
Answer: Wage

These are semi-processed goods which are not ready for final use by the consumer, which have undergone some processing but need to go through additional processing before they can be actually used by the consumer. These are supplied to final good firms for conversion into goods in their finished stage.
Select one:
 a. Intermediate Goods 
 b. Exports
 c. Final Goods
 d. Imports

The resources used in the production of goods & services. It refers to the use of economic resources to create goods and services that will be used to satisfy human wants.
Select one:
 a. Variable Inputs
 b. Inputs
 c. Outputs
 d. Fixed Inputs

Consumer Theory describes how consumers make decisions about what to buy given their income and prices of goods and services.
Select one:
 True
 False

A form of business organization that is authorized to act as a legal entity regardless of the number of owners. 

Select one:
 a.
Distributor
 b.
Partnership 
 c.
Proprietorship
 d.
Corporation

Graph showing the quantities supplied at each and every possible price in the marker.
Select one:
 a.
Supply Schedule 
 b.
Variabale Costs
 c.
Demand Schedule
 d.
Supply Curve 

Human-made goods that are used to produce other goods and services
Answer:  Capital

A Latin phrase that means while certain variables change, "all other things remain unchanged."
Select one:
 a.
Ceteris Paribus 
 b.
Entrepreneurship
 c.
Microeconomics
 d.
Microeconomics

Measure of the way in which the quantity supplied responds to a change in price. → Elasticity of Demand
Select one:
 True 
 False 

What are the three basic economic questions?
Select one:
 a.
What?, How?, Whom? 
 b.
What?, Why?. Whom?
 c.
How?, Whom?, When?
 d.
What?, Where?, Whom?

Decision making based on extra benefit/cost of an action.
Answer:  Marginal Analysis

What type of business structure is owned by many people?
Select one:
 a.
Sole Proprietorship
 b.
Corporation 
 c.
Partnership

Extra revenue from the production of one additional unit.
Answer:  Marginal Revenue

Provides a means to clearly show economic relationships in two-dimensional space. Economic analysis is often concerned with two variables confined to the upper-right (northeast) quadrant of the coordinate number system.
Answer:  Graphs

Changes in price cause a SMALL change in quantity demanded. -INELASTIC DEMAND
Select one:
 True
 False

Monopoly and Monopolistic Competition mean the same:
Select one:
 True
 False

In a Market structure called 'Monopoly' there will:
Select one:
 a.
One Firm 
 b.
Two Firms
 c.
Few Firms
 d.
Many Firms

What is a payment made by an employer to an employee?
Select one:
 a.
Marginal
 b.
Profit
 c.
Interest
 d.
Wage 

The creative ability of individuals to seek profits by taking risk and combining resources to produce innovative products.
Answer:  Entrepreneurship

Combination of desire, ability, and willingness to buy a product. → Demand
Select one:
 True 
 False
Feedback

Listing showing the quantity demanded at all possible prices that might prevail in the market at any given time.
Answer:   Demand Schedule

The main difference between Oligopoly and duopoly is
Select one:
 a.
No. of Firms 
 b.
Imperfect Knowledge
 c.
Similar Products
 d.
Strong Bariers

Law of supply: suppliers will offer more for sale at _____ prices and less for sale at _____ prices.
Select one:
 a.
high, low     A
 b.
Demand Curve
 c.
down, up
 d.
Supply Curve

Amount demanded at any given price.
Answer:  Quantity Demanded

The condition in which human wants are forever greater than the available supply of time, goods, and resources.
Answer:  Scarcity

The branch of economics that studies, decision making by a single individual, household, firm, industry, or level of government → Macroeconomics
Select one:
 True
 False 
Feedback

Occurs when two variables are unrelated → Independent relationship
Select one:
 True
 False

3 Factors Affecting Elasticity of Demand → Necessity, substituitability, income
Select one:
 True
 False

Supply curve that shows the quantities offered at various prices BY ALL FIRMS that sell product in a given market. → Cost of Production
Select one:
 True
 False

Economic policies for determining the amount of money supply, rates of interest & exchange rates → Monetary Policy
Select one:
 True
 
Any natural resource provided by nature that is used to produce goods and services
Answer:  Land

Principle that more will be offered for sale at higher and prices and less at lower prices. → Law of Supply
Select one:
 True

Demand: shift left=______ in demand.
Select one:
 a.
Demand
 b.
Decrease 
 c.
Inverse Relationship
 d.
Shortagae

An analysis limited to statements that are verifiable
Select one:
 a.
Positive Economics
 b.
Direct Relationship
 c.
Inverse Relationship
 d.
Normative Economics

The mental and physical capacity of workers to produce goods and services
Answer:  Labor

The study of how society chooses to allocate its scarce resources to the production of goods and services in order ot satisfy unlimited wants → Microeconomics
Select one:
 True
 False 

What is it called when you have limited quantities of resources used to meet unlimited wants?
Select one:
 a.
Scarcity 
 b.
Specialization
 c.
Profit
 d.

 What is the study of economic behavior and decision makings of small units, such as individuals, families, and businesses called?
Select one:
 a.
Microeconomics  
 b.
Economic Statistics
 c.
Economics
 d.
Macroeconomics

Amount that producers bring to the market at at any given price.
Answer:  Quantity Supplied

Variable plus fixed costs, all costs associated with production.
Answer:  Total Costs

A person who takes a risk to produce goods and services in search of profit 

Select one:
 a.
Entrepreneur 
 b.
Profiteer
 c.
Magistrate
 d.
Baliff

Corporations are in business for what?
Select one:
 a.
Profit 
 b.
Non Profit
 c.
Stockholders

Lowest legal price that can be paid for a good or service.
Select one:
 a.
Fixed Costs
 b.
Market Economy
 c.
Price Floor 
 d.
Total Costs

What kind of business is BEST described by these statements?
I am the only owner of my business. 
I take all the risks of doing business. 
I keep all the profits. 

Select one:
 a.
 Corporation
 b.
Partnership
 c.
Sole Proprietorship 
 d.
Cooperative

Amount of money, resources, raw materials, labor, and production it takes to make a good, item, or service.
Select one:
 a.
Inelastic
 b.
Cost of Production 
 c.
Quantity Demanded
 d.
Elastic

Satisfaction or usefulness obtained from acquiring one more unit of a product.
Select one:
 a.
Variable Cost
 b.
Marginal Utility 
 c.
Marginal Analysis
 d.
Quantity Supplied

The basic categories of inputs used to produce goods and services.
Answer:  Resources

The branch of economics that studies decision making for the economy as a whole → Microeconomics
Select one:
 True
 False 

List the four market structures in order from least competitive to most competitive.
Select one:
 a.
Monopoly, Oligopoly, Monopolistic Competition, Perfect Competition 
 b.
Oligopoly, Monopoly, Perfect Competition, Monopolistic Competition
 c.
Perfect Competition, Oligopoly, Monopoly, Monopolistic Competition
 d.
Monopoly, Monopolistic Competition, Perfect Competition, Oligopoly

An analysis based on value judgments or opinions and use words such as good, bad, ought to, and should.
Select one:
 a.
Normative Economics 
 b.
Entrepreneurship
 c.
Direct Relationship
 d.
Positive Economics

What are the four factors of production?
Select one:
 a.
Capital, money, supply, demand
 b.
Land, capital, money, entrepreneurs
 c.
Labor, capital, supply, demand
 d.
Land, capital, labor, entrepreneurs  

What is the measure of how consumers react to a change in price? 
Select one:
 a.
Equilibrium Price
 b.
Marginal
 c.
Scarcity
 d.
Elasticity 

What type of business consists of two or more people?
Select one:
 a.
Partnership 
 b.
Corporation
 c.
Franchise
 d.
Sole Proprietorship

Changes in price cause a LARGE change in quantity demanded.
Answer:  Elastic Demand