Economics as a Science
Economics · 50 practice questions
Basic concepts — wants, scarcity, choice, scale of preference, opportunity cost, rationality, production, distribution and consumption; the economic problems of what, how and for whom to produce, and efficiency of resource use; application of the production possibility frontier (PPF) to economic problems.
- Compare various concepts in economics and their applications.
- Interpret graphs/schedules in relation to the concepts.
- Identify economic problems and proffer solutions.
Try a few questions
- Practice question 1
A point lying exactly on a country's production possibility frontier represents
- A.full and efficient utilization of available resources
- B.unemployment of resources
- C.an output level currently unattainable
- D.a fall in the country's resource base
Show the answer
A. full and efficient utilization of available resources
Points on the PPF show maximum efficient output given resources.
- Practice question 2
The economic question of "for whom to produce" is more precisely concerned with
- A.deciding how output should be distributed among members of society
- B.deciding which technique of production to use
- C.deciding the total quantity of goods to produce
- D.deciding where factories should be sited
Show the answer
A. deciding how output should be distributed among members of society
"For whom" concerns the distribution of output among people.
- Practice question 3
A firm forgoes an expected profit of ₦120,000 from Project B to invest in Project A instead. The opportunity cost of choosing Project A is
- A.₦0
- B.the total cost of Project A
- C.the combined profit of both projects
- D.₦120,000
Show the answer
D. ₦120,000
The forgone profit of the best alternative, ₦120,000, is the opportunity cost.
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