Test Your Knowledge About Economics! Quiz

2.

Absoulute Advantage is:

The ability to make something using fewer resources than other producers
Is subjective
Requires Time
Requires Information

Correct Answer

A. The ability to make something using fewer resources than other producers

Explanation

Absolute advantage refers to the ability of a producer to create a product or service using fewer resources compared to other producers. This means that the producer can achieve a higher level of efficiency and productivity, resulting in lower costs and higher output. It is not subjective, as it is based on objective measures of resource usage. While time and information may be important factors in achieving absolute advantage, they are not explicitly mentioned in the given options.

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3.

Sunk cost is a cost that has already been what?

Incurred and cannot be recovered
Affecting economic decisions
Varying with circumstances
None of the Above

Correct Answer

A. Incurred and cannot be recovered

Explanation

The correct answer is "Incurred and cannot be recovered." Sunk cost refers to a cost that has already been spent or incurred and cannot be recovered. It is a cost that has no influence on future decisions because it cannot be changed or recovered. Sunk costs are irrelevant in decision making as they are considered a past expense that should not factor into future choices.

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4.

The law of Comparative Advantage is defined as

Cost that has been incurred
Using fewer resources than other producers
Advantatges over other producers
The individual firm, religon,or country with the lowest oppurtunity cost if producing a particular good should speacialize in that good

Correct Answer

A. The individual firm, religon,or country with the lowest oppurtunity cost if producing a particular good should speacialize in that good

Explanation

The law of Comparative Advantage states that the individual firm, religion, or country that has the lowest opportunity cost of producing a particular good should specialize in producing that good. This means that if one producer can produce a good with fewer resources compared to other producers, they have a comparative advantage in producing that good. By specializing in the production of goods where they have a comparative advantage, producers can maximize their efficiency and overall output. This principle allows for mutually beneficial trade between producers with different comparative advantages.

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5.

Using fewer resources then other producers is:

Absolute Advantage
Comparative Advantage
Sunk Cost
None of the Above

Correct Answer

A. Absolute Advantage

Explanation

Absolute advantage refers to the ability of a producer to produce more output using fewer resources compared to other producers. In this context, the correct answer suggests that the producer mentioned in the question is able to produce more output while utilizing fewer resources compared to other producers. This indicates that the producer has an absolute advantage over its competitors.

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6.

Comparative Advantage is:

Cost that has been incurred
Oppurtunity cost of a company
The ability to make something at a lower oppurtunity cost then other producers
Ability to use fewer resources

Correct Answer

A. The ability to make something at a lower oppurtunity cost then other producers

Explanation

Comparative Advantage refers to the ability of a company or producer to manufacture a product or provide a service at a lower opportunity cost compared to other producers. This means that the company can produce a good or service with fewer resources or at a lower cost in terms of alternative goods or services forgone. It implies that the company has a competitive edge in terms of efficiency and resource allocation, allowing it to specialize in the production of certain goods or services where it has a comparative advantage over others.

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7.

The direct exchange of one good for another without using money is a

Barter
Exchange
Trade
None of the above

Correct Answer

A. Barter

Explanation

Barter refers to the direct exchange of goods without the involvement of money. In a barter system, individuals or entities trade goods or services directly with each other, without the need for currency. This practice was prevalent before the invention of money and is still used in some parts of the world today. Therefore, the correct answer is barter.

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8.

Economic growth does what to the economy

Increases
Decreases
Nothing
None of the above

Correct Answer

A. Increases

Explanation

Economic growth refers to an increase in the production and consumption of goods and services in an economy over time. When the economy experiences growth, it means that there is an expansion in economic activity, leading to higher levels of employment, income, and overall prosperity. Therefore, the correct answer is "increases" as economic growth positively impacts the economy by fostering development and improving living standards.

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1

9.

Private Propety rights allows owners to do what:

Rent
Sell
Use
All of the Above

Correct Answer

A. All of the Above

Explanation

Private property rights allow owners to rent, sell, and use their property as they see fit. Renting allows owners to generate income by leasing their property to others. Selling allows owners to transfer ownership of their property in exchange for money. Using the property refers to the owner's right to utilize and enjoy their property for personal or commercial purposes. Therefore, the correct answer is "All of the Above" as private property rights encompass all these actions.

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Test Your Knowledge About Economics! Quiz

The value of the best alternative forgone when an activity is chosen can best be defined as

Quiz Preview

Absoulute Advantage is:

Sunk cost is a cost that has already been what?

The law of Comparative Advantage is defined as

Using fewer resources then other producers is:

Comparative Advantage is:

The direct exchange of one good for another without using money is a

Economic growth does what to the economy

Private Propety rights allows owners to do what: