Economics Quiz: Law of Demand and Demand Curve

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Questions and Answers

When a university chooses to expand its football stadium instead of its baseball stadium, it faces which type of tradeoff?

"for whom" tradeoff

"what" tradeoff (correct)

"how" tradeoff

"why" tradeoff

The concept of scarcity implies that every choice involves which of the following?

The question "what"

Giving up something for nothing

Money

An opportunity cost (correct)

In the context of economics, scarcity applies to which of the following?

Neither time nor money

Money but not time

Time but not money

Both money and time (correct)

What is the opportunity cost of an option you decide to pursue?

The highest valued alternative you give up to get it Signup and view all the answers

Entrepreneurs are known to do all of the following EXCEPT:

Own all the other resources Signup and view all the answers

If a photographer opts for a digital camera over a film camera, what type of tradeoff is being considered?

"how" tradeoff Signup and view all the answers

When a government allocates resources to build a dam instead of a highway, this demonstrates which concept?

Opportunity cost Signup and view all the answers

When deciding to attend summer school, which of the following best represents the opportunity cost of this decision?

P16,900.00 Signup and view all the answers

What is the primary reason firms engage in production?

To acquire profits Signup and view all the answers

The process of using resources to produce new capital is known as what?

Investment Signup and view all the answers

Which of the following is an example of an investment?

Buying shares of stock Signup and view all the answers

Which scenario demonstrates an act of production as defined in economics?

A bakery sells freshly baked bread Signup and view all the answers

What characterizes the optimal production method?

It minimizes cost Signup and view all the answers

How are costs of production determined?

By both technologies and input prices Signup and view all the answers

What does total revenue minus total cost yield?

Profit or loss Signup and view all the answers

If Total Cost is P350,000 and Total Fixed Cost is P250,000, what are the total variable costs?

P150,000 Signup and view all the answers

What is the total fixed cost for Farley Farm?

P350,000.00 Signup and view all the answers

What significant event happened in 2004 related to Facebook's creation?

Five people were invited by Mark to discuss a business opportunity Signup and view all the answers

According to Alfred Marshall, how is Economics defined?

A study of man in the ordinary business of life Signup and view all the answers

What could happen if the three founders of Facebook had opted to complete their degrees instead of pursuing the business?

They may have missed the opportunity to become billionaires Signup and view all the answers

What has contributed to Facebook's status as a leading social media platform?

Two billion monthly users today Signup and view all the answers

Which of the following best describes the nature of Economics?

A study of human behavior and choices Signup and view all the answers

What might be a reason for declining Mark Zuckerberg's invitation in 2004?

Belief that social networks would fail Signup and view all the answers

What aspect of microeconomics does the content emphasize?

Behavior of individuals and businesses Signup and view all the answers

What is an opportunity cost in the context of the CEO's decision to invest in a new inventory and data analytics system?

The potential profits from not investing in another project. Signup and view all the answers

If the bank employee chooses to attend the football match instead of working, which represents their opportunity cost?

The salary for the day spent at the match. Signup and view all the answers

Which of the following best describes the decision-making scenario faced by the bank employee?

An ethical dilemma between personal life and work. Signup and view all the answers

What might be a potential benefit of the CEO deciding to invest in the new system?

Enhanced productivity and efficiency in operations. Signup and view all the answers

In terms of economic decision-making, what does the CEO's investment decision illustrate?

Balancing short-term costs with long-term gain. Signup and view all the answers

Which outcome could potentially result from the bank employee deciding to go in to help their boss?

Loss of opportunity for personal leisure activities. Signup and view all the answers

How does the concept of scarcity relate to the decisions made by both the CEO and the bank employee?

It pertains to the limited resources available for competing needs. Signup and view all the answers

What element should the bank employee consider when evaluating the trade-off of their decision?

The financial implications of supporting their boss. Signup and view all the answers

What does the law of demand state about the relationship between price and quantity demanded?

As price increases, quantity demanded decreases. Signup and view all the answers

How does a demand schedule present information?

It lists the quantities of a product demanded at various price levels. Signup and view all the answers

What is the implication of a downward-sloping demand curve?

Higher prices diminish demand. Signup and view all the answers

What might cause an increase in demand for rice during the Christmas season?

Seasonal events and celebrations. Signup and view all the answers

Which element does NOT directly influence the quantity demanded according to the law of demand?

Changes in the price of the product. Signup and view all the answers

If the price of rice is set at $50 per kilo, how many kilos would typically be demanded based on the demand schedule?

125 kilos. Signup and view all the answers

What does an increase in price generally lead to regarding consumer purchasing behavior?

Decreased quantity demanded for the same product. Signup and view all the answers

What effect would a stable price of rice have on demand if consumer preferences suddenly shift in favor of rice?

Demand would increase due to the change in consumer preference. Signup and view all the answers

Study Notes

Economics

Economics is the study of how people make choices when faced with scarcity.

Law of Demand

The Law of Demand: when prices go up, people buy less. When prices go down, people buy more.

Demand Schedule

The demand schedule shows the quantity of a product demanded at any given price.

Demand Curve

The demand curve is a graphical representation of the demand schedule.
It shows the relationship between price and quantity demanded.
The normal demand curve slopes downwards from left to right.

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Description

Test your understanding of fundamental economic principles such as the Law of Demand and the Demand Curve. This quiz explores how price changes affect consumer behavior and the graphical representation of demand schedules. Challenge yourself and deepen your knowledge of economics!