APPLIED ECONOMICS FINAL EXAMINATION, Exercises of Economics

Download APPLIED ECONOMICS FINAL EXAMINATION and more Exercises Economics in PDF only on Docsity! APPLIED ECONOMICS FINAL EXAMINATION Name: ________________________________________________ Score: ____________ Directions: a. Strictly NO ERASURE! b. Write all your answers before the number except for ESSAY. Test I. Multiple Choice. 1. It is the person who buys the product business offers for sale. a. Competitor b. User c. Consumer 2. The term _____ refers to the resources used to produce goods and services. a. Output b. Product c. Input 3. _____ is the combined production of several units of a given input. a. Average Product b. Marginal Product c. Total Product 4. The _____ shapes the foreign exchange market through its trade, capital movements, and financial flows. a. Internal Sector b. Internal and External c. External Sector 5. It refers to the total combined utility derives from consuming certain units of a good. a. Output b. Utils c. Total Utility 6. It is the term used for satisfaction. a. Consumption b. Marginal utility c. Utility 7. It describes how consumers make decisions on what to buy. a. Utility b. Production c. Consumer Theory 8. _____ refers to the use of goods and services to satisfy human wants directly. a. Total utility b. Output c. Consumption 9. A _____ is one unit of satisfaction. a. Utills b. Utels c. Utils 10. _____ refers to the average contribution per unit of input and is equal to TP/i. a. Marginal Product b. Total Product c. Average Product Test II. True or False 1. The Law of Diminishing Marginal Utility states that as additional units of a good are consumed, the addition utility derived from each additional unit tends to diminish. 2. The production function contains the functional relationship between output and the basic factors of land, labor, and capital. 3. In spite of being top grosser of the biggest sector that is service, the trade industry supported by the transport industry is also handicapped by the limited size of its establishments. 4. The environmental resources are vulnerable to climate change affecting production. 5. If competitors are numerous and offer basically similar products and services, the market will be more attractive. 6. If a supplier can enjoy the power to drive prices up, it is also possible for a buyer to drive prices down. 7. When it is easy to substitute products in a market, it is expected that buyers will not switch to alternatives in case of price increases. 8. When new investor enters a market, the share of the participants in the market will be divided among more people and will therefore increase, thus accumulate profit. 9. The flipside to the physical flow is the money payment flow. 10. Factors that affect growth of the industry is migration of population from rural to urban areas. Test III. Identification 1. It is generally the simplest way to set up a business. 2. It is an entity organized by people with similar needs to provide themselves with goods or services or to jointly use available resources to improve their income. 3. It is a legal entity that is separate from its owners, the shareholders. 4. This includes a look at the population size the geography of the place where business will be located, land distribution, climate, and in today’s global warming situation, whether or not the area if prone to flood or earthquake. 5. It is the flow of activities of household and firms in a circular direction. 6. This sector processes raw materials from agriculture, fishery and forestry into intermediate products that are further processed into final product. 7. This sector produces the intangibles supporting and complementing production in the other sectors as well as among its own industries. 8. It is an emerging industry as expenditures of foreign tourist on related services such as hotel and restaurants, transport and entertainment grew. 9. It refers to the use of economic resources to create goods and services that will be used to satisfy human wants. 10. It refers to the product created as a result of the combination of input in the production process. Test IV. Essay (5 points each) Strictly NO ERASURE! 1. Why do poor spend more than what they earn? ________________________________________________________________________ ________________________________________________________________________ ________________________________________________________________________ 2. What are savings and investment for? ________________________________________________________________________ ________________________________________________________________________ ________________________________________________________________________