Economics Practice Quiz 124

Q1.In the example given, what are the two goods produced by the economy?

A. Corn and cotton B. Corn and wheat C. Cotton and wool D. Rice and cotton

Q2.What does the production possibility frontier represent?

A. The maximum combinations of goods producible with full resource utilisation B. The minimum combinations of goods producible C. The actual production of an economy D. The distribution of goods among individuals

Q3.Which of the following is NOT a question every society must decide?

A. What is produced and in what quantities? B. How are these goods produced? C. For whom are these goods produced? D. Why are these goods produced?

Q4.What is the reason every economy faces the problem of allocating scarce resources?

A. Resources are limited compared to wants and have alternative uses B. Resources are unlimited C. People have no wants D. Technology is fixed

Q5.Which of the following is an example of a decision about 'how are these goods produced'?

A. Whether to use more labour or more machines B. Whether to produce more food or luxury goods C. Whether to ensure minimum consumption for everyone D. Whether to provide free education

Q6.Which of the following is an example of a decision about 'for whom are these goods produced'?

A. Whether to ensure a minimum amount of consumption for everyone B. Whether to use more resources in education or military C. Whether to adopt new technology D. Whether to produce more consumption goods or investment goods

Q7.What is the maximum amount of corn that can be produced if all resources are used in its production?

A. 4 units B. 10 units C. 9 units D. 7 units

Q8.What is the maximum amount of cotton that can be produced if all resources are used in its production?

A. 10 units B. 4 units C. 9 units D. 7 units

Q9.Which of the following combinations of corn and cotton is possible according to the production possibility frontier?

A. 1 unit of corn and 9 units of cotton B. 4 units of corn and 10 units of cotton C. 2 units of corn and 8 units of cotton D. 3 units of corn and 5 units of cotton

Q10.What does a point lying strictly below the production possibility frontier represent?

A. Underemployment or wasteful use of resources B. Full utilization of resources C. Maximum production of both goods D. Efficient production

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Economics Practice Quiz 124