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Scarcity, Trade-Offs, and Production Possibilities MCQ

1. ______ are examples of consumer goods.

Machines and equipment

Education and training

Factories and warehouses

Televisions and sofas

Answer

Correct Answer: Televisions and sofas

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2. During colonial times in U.S. history, ______.

Most people worked in customer service

Only three percent of the people worked on farms

Agriculture accounted for most jobs

Manufacturing accounted for most jobs

Answer

Correct Answer: Agriculture accounted for most jobs

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3. When an economy experiences growth, ______.

Trade-offs disappear

Scarcity still exists

Efficiency is impossible to attain

Consumer investment has been high

Answer

Correct Answer: Scarcity still exists

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4. An economy operating at a point along the production possibilities curve represents ______.

Waste

Shortages

Efficiency

Growth

Answer

Correct Answer: Efficiency

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5. If a nation’s economy operates inside of the production possibilities curve, it is ______.

Unregulated

Inefficient

At full productivity

At full employment

Answer

Correct Answer: Inefficient

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6. If an economy experiences growth, the production possibilities curve will ______.

Shift outward

Shift inward

Go from a bowed curve to a straight line

Contain more points but not move

Answer

Correct Answer: Shift outward

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7. If a point is outside a production possibilities curve, what does it show?

An efficient economy

An inefficient economy

An opportunity cost

An economic impossibility

Answer

Correct Answer: An economic impossibility

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8. In the circular flow diagram, goods and services flow ______.

Diagonally

Upward

Clockwise

Horizontally

Answer

Correct Answer: Clockwise

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9. The simple circular flow diagram shows interactions between ______.

Marketers and developers

Rulers and subjects

Governments and firms

Households and firms

Answer

Correct Answer: Households and firms

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10. Who are the sellers in factor markets?

Firms

Households

Governments

Tenants

Answer

Correct Answer: Households

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11. In product markets, ______ flow to the firms.

Payments

Services

Goods

Wages

Answer

Correct Answer: Payments

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12. Tractors, bulldozers, and dump trucks are all examples of ______.

Capital

Labor

Wages

Services

Answer

Correct Answer: Capital

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13. In a developed country, production is usually ______.

Capital-free

Labor-free

Capital-intensive

Labor-intensive

Answer

Correct Answer: Capital-intensive

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14. What is the most common type of economy in the world today?

Socialist

Mixed

Market

Command

Answer

Correct Answer: Mixed

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15. North Korea has a ______ economy.

Socialist

Mixed

Market

Command

Answer

Correct Answer: Command

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16. Simple circular flow model is An illustration of the continuous flow of

Inputs

Payments

Goods

All of these

Answer

Correct Answer: All of these

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17. Markets where products are bought by households and sold by firms are called

Product Markets

Competitive market

Free market

Imperfect market

Answer

Correct Answer: Product Markets

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18. Production possibilities curve is The available production technology that firms use to turn their inputs into outputs

True

False

Answer

Correct Answer: True

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19. An economy where government and the private sector determine the allocation of resources is called

Mixed Economy

Market Economy

Command economy

Planned economy

Answer

Correct Answer: Mixed Economy

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20. An economy that allocates goods and services through the private decisions of consumers, input suppliers, and firms is known as

Mixed Economy

Market Economy

Command economy

Planned economy

Answer

Correct Answer: Market Economy

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21. Labor intensive are Production that uses a ____ amount of labor

Large

Medium

Small

Little

Answer

Correct Answer: Large

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22. Condition where the opportunity cost of producing additional units of a good rises as society produces more of that good is called

Increasing opportunity cost

Decreasing opportunity cost

Constant opportunity cost

Variale opportunity cost

Answer

Correct Answer: Increasing opportunity cost

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23. Markets where households sell the use of their inputs to firms

Factor markets

Product Markets

Competitive market

Free market

Answer

Correct Answer: Factor markets

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24. ______ sovereignty Is The concept that consumers vote with their dollars in a market economy

Producer

Consumer

Product

Market

Answer

Correct Answer: Consumer

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25. Command economy is an economy in which the _____ uses central planning to coordinate most economic activities.

Market

Government

Consumer

Producer

Answer

Correct Answer: Government

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26. Capital intensive are _____ that uses a large amount of capital

Products

Production

Consumption

Consumers

Answer

Correct Answer: Production

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Microeconomics MCQs | Topic-wise

MCQ on Basic Microeconomics	MCQ on Competitive Markets in Economics
MCQ on Consumer Choice Theory	MCQ on Demand, Supply, and Market Equilibrium
MCQ on Eight Powerful Ideas	MCQ on Elasticities in Microeconomics
MCQ on Income, Poverty and Health Care	MCQ on International Finance
MCQ on International Trade	MCQ on Introduction to Microeconomics
MCQ on Market Efficiency and Welfare	MCQ on Market Failure
MCQ on Market in Motion and Price Controls	MCQ on Markets for Labor, Capital, and Land
MCQ on Monopolistic Competition	MCQ on Monopoly and Antitrust
MCQ on Oligopoly and Strategic Behavior	MCQ on Production and Costs
MCQ on Public Finance and Public Choice	MCQ on Scarcity, Trade-Offs, and Production Possibilities
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