Encircle the correct answer.

1. Human wants are

A. fixed. B. limited. C. unlimited. D. likely to decrease.
2. Competition occurs if
A. government agencies are the only producers of goods or services.
B. one business has the approval to sell the total production of one type of good or service.
C. two or more enterprise try to sell the same type of goods or services to the same customer.
D. one large business owns all the natural resources needed to produce some particular product
3. Economics is the study of
A. production technology. C. consumption decisions.
B. the best way to run society. D. how society decides what, how and for whom to produce.
4. Macroeconomics is the study of
A. the economy as a whole. C. household purchase decision.
B. individual building blocks in the economy. D. the relationship between different sectors of the economy.
5. The opportunity cost of a good is
A. the time lost in finding it. C. the expenditure on the good.
B. the loss of interest in using savings. D. the value of the best foregone alternative.
6. Microeconomics is concerned with
A. the electronic industry. C. the economy as a whole.
B. the interaction within the entire economy. D. the study of individual economic behavior.
7. Supply curve is directly affected by
A. consumers’ income. C. price of related goods.
B. government regulations. D. consumers’ expectations.
8. A market can accurately be described as
A. a place to have fun. C. a place to sell things.
B. a place to buy things. D. a place where buyers and seller meet.
9. The decrease in the labor supply causes
A. shortage on the skilled laborers. C. elasticity in the demand and supply.
B. improvement of the country’s GDP. D. increase in the production of the basic commodities.
10. Over population in the Philippines may
A. restore the natural resources. C. bring prosperity to the country.
B. improve the country’s economy. D. cause shortage on the production of basic commodities.
11. The amount of resources in an economy
A. are always fixed. C. will never decrease.
B. always increase over time. D. are limited at any moment in time.
12. The price elasticity of demand measures
A. a change in price. C. how far a demand curve shifts.
B. a change in quantity demanded. D. the responsiveness of quantity demanded to a change in price.

13. The demand curve does not directly affected by

A. consumers’ income and taste.
B. the cost of production and bank opening hours.
14. The basic economic problems will not be solved by
A. market forces.
B. creating unlimited resources.
15. A country may be considered underdeveloped due to
A. high poverty rate.
B. high standard of living.
C. the price of related goods and preference.
D. the price of related goods and consumers’ income.
C. government intervention.
D. the mixture or government intervention and free market.
C. growth of industries.
D. high rate of urbanization.
16. The setting of minimum wages by the government assures
A. suffering from company owners. C. happiness and contentment among employees.
B. improvement of the employees’ standard of living. D. protection for workers that they are not underpaid
17. The equilibrium price clears the market; it is the price at which
A. everything is sold. C. quantity demand equals quantity supply.
B. quantity demand is lesser than quantity supply D. quantity demand is greater than quantity supply.
18. A measurement showing how quantity demanded varies with income is the
A. price elasticity of demand. C. budget elasticity of demand.
B. income elasticity of demand. D. cross-price elasticity of demand.
19. The quantity of a product that a buyer wishes to purchase at each possible price is
A. supply. B. income. C. demand. D. elasticity.
20. If a price increase of good A increase the quantity demanded of good B, then good B is a
A. bargain. B. inferior good. C. substitute goods. D. complementary good.
21. If your income doubles and the prices of the goods you buy double, then you demand for these goods will likely
A. shift. B. increase. C. decrease. D. not change .
22. When the percentage change in the price exceeds the percentage change in quantity demanded, then the demand is
A. elastic. B. unitary. C. inelastic. D. irrelevant.
23. The basic and central economic problem confronting every individual and society
A. household B. shortage C. scarcity D. system
24. Refers to all resources found in nature and are, therefore, not man-made.
A. capital B. land C. labor D. entrepreneur
25. Refers to any form of human effort exerted in the production of goods and services
A. capital B. land C. labor D. entrepreneur
26. These are man-made goods used in production of other goods and services.
A. capital B. land C. labor D. entrepreneur
27. It refers to a person who organizes, manages, and assumes the risk of a firm.
A. capital B. land C. labor D. entrepreneur
28. Refers to the place where resources or services are bought and sold.
A. market B. household C. business D. land
29. Refers to the productive and proper allocation of economic resources
A. economics B. effectiveness C. equity D. equipment
30. Pertains to the quantity of a good or services that people are ready to buy at a given price.
A. Supply B. Demand C. Product D. quantity
31. Refers to the graphical representation showing the relationship between price and quantities demanded per time period.
A. Demand B. Demand Curve C. Supply D. Supply Curve
32. It shows the relationship between demand for a commodity and the factors that determine or influence this demand.
A. Demand Function B. Demand Curve C. Supply Function D. Supply Curve
33. Refers to goods that are interchanged with another goods
A. Complementary Goods B. Substitute goods C. Public goods D. Merit goods
34. The quantity of goods and services that firms are ready and willing to sell at a given price.
A. Supply B. Demand C. Product D. quantity
35. A graphical representation showing the relationship between the prices of the product sold and the quantity supplied per time
period.
A. Demand Function B. Demand Curve C. Supply Function D. Supply Curve
36. Pertains to the balance that exists when quantity demand equals quantity supplied.
A. Equilibrium B. Market Equilibrium C. Scarcity D. Shortage
37. The condition in the market where the quantity supplied is more that the quantity demanded
A. Equilibrium B. Surplus C. Scarcity D. Shortage
38. The condition in the market where the quantity demanded is higher that the quantity supplied
A. Equilibrium B. Surplus C. Scarcity D. Shortage
39. It is the responsiveness of consumers’ demand to a change in the price of the good sold.
A. Income elasticity B. Price elasticity C. demand elasticity D. Cross price elasticity
40. It is the responsiveness of consumers’ demand to a change in relation to change in the price of other related goods.
A. Income elasticity B. Price elasticity C. demand elasticity D. Cross price elasticity
41. The ideal market situation for the buyer and seller
A. Perfect Competition B. Monopolistic Competition C. Monopoly D. Oligopoly
42. The market situation where government franchise is granted only on a single firm.
A. Perfect Competition B. Monopolistic Competition C. Monopoly D. Oligopoly
43. The market is dominated by a small number of interacting firms
A. Perfect Competition B. Monopolistic Competition C. Monopoly D. Oligopoly
44. The ownership is invested in a single seller.
A. Perfect Competition B. Monopolistic Competition C. Monopoly D. Oligopoly
45. The products are differentiated.
A. Perfect Competition B. Monopolistic Competition C. Monopoly D. Oligopoly
46. The substitute product may or may not be available.
A. Perfect Competition B. Monopolistic Competition C. Monopoly D. Oligopoly
47. There are large number of buyers and sellers.
A. Perfect Competition B. Monopolistic Competition C. Monopoly D. Oligopoly
48. There exists a non-price competition among firms.
A. Perfect Competition B. Monopolistic Competition C. Monopoly D. Oligopoly
49. There exists interdependence among firms.
A. Perfect Competition B. Monopolistic Competition C. Monopoly D. Oligopoly
50. There is always a perfect substitute that is always available.
A. Perfect Competition B. Monopolistic Competition C. Monopoly D. Oligopoly