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Quiz about Simpleton Learns Economics
Quiz about Simpleton Learns Economics

Simpleton Learns Economics Trivia Quiz


Economics is one of my favourite subjects (time to get my head checked. I decided to create a quiz ...

A multiple-choice quiz by ace_sodium. Estimated time: 5 mins.
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Author
ace_sodium
Time
5 mins
Type
Multiple Choice
Quiz #
113,452
Updated
Dec 03 21
# Qns
10
Difficulty
Tough
Avg Score
5 / 10
Plays
2564
Last 3 plays: Guest 93 (4/10), Guest 69 (6/10), Guest 69 (3/10).
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Question 1 of 10
1. Two types of approaches are widely used when it comes to the problem of measurement of 'utility'. What are those two approaches known as? Hint


Question 2 of 10
2. Which of the following is NOT a factor of production (or factor inputs)? Hint


Question 3 of 10
3. In traditional economic theory, four types of markets are identified. Which of the following is NOT one of them? Hint


Question 4 of 10
4. A Pure Competition Market and a Pure & Perfect Competition Market are the same.


Question 5 of 10
5. The demand graph for which of the following markets is a 'kinked' graph? Hint


Question 6 of 10
6. Simple one: Total Cost (TC) of a product is comprised of various components. Which of the following options describes TC most accurately? Hint


Question 7 of 10
7. Who said, "Supply creates its own demand"? Hint


Question 8 of 10
8. In simplistic terms, what is the difference between Production and Consumption in an economy better known as? Hint


Question 9 of 10
9. This type of unemployment is due to the operation of the business cycle. It is generally suffered by Capitalist countries. It is also called 'Keynesian Unemployment'. What is this type of unemployment better known as? Hint


Question 10 of 10
10. Who first introduced the concept of 'multiplier'? Hint



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Most Recent Scores
Oct 30 2024 : Guest 93: 4/10
Sep 20 2024 : Guest 69: 6/10
Sep 18 2024 : Guest 69: 3/10

Score Distribution

quiz
Quiz Answer Key and Fun Facts
1. Two types of approaches are widely used when it comes to the problem of measurement of 'utility'. What are those two approaches known as?

Answer: Cardinalist & Ordinalist

Cardinalist approach says that utility can be measured in monetary units. Some economists even coined the word 'utils' for measurement units.

The Ordinalist approach says the consumer need not know in specific units the utility, but it is enough if he can rank the various 'baskets of goods' to determine order of preference.

Ordinalist approach can be further divided into "indifference curves" and "revealed preference hypothesis."
2. Which of the following is NOT a factor of production (or factor inputs)?

Answer: Raw materials

There are two types of inputs - factor and non-factor. The factor inputs are land (owned by the landlord), labour (owned by the labourer), capital (owned by the moneylender) and enterprise (owned by the entrepreneur). Raw materials are a non-factor input.
3. In traditional economic theory, four types of markets are identified. Which of the following is NOT one of them?

Answer: Capital Control Market

The fourth being Pure (& perfect) Competition. Basically, the markets are identified on the basis of products (homogenous & differentiated), knowledge (of buyer & seller), number of buyers & sellers etc.
4. A Pure Competition Market and a Pure & Perfect Competition Market are the same.

Answer: False

In a Pure Competition Market, there are a lot of buyers and sellers, homogenous products, etc. However, a Pure Competition Market becomes a Pure and Perfect Competition Market only when it satisfies the following conditions (in addition to 'Pure' Competition Market conditions)-
(1) When consumers have perfect knowledge;
(2) Perfect mobility of factors of production
5. The demand graph for which of the following markets is a 'kinked' graph?

Answer: Oligopoly

In an Oligopoly, very few sellers exist in the market - indulging in severe cut-throat competition. The 'kink' implies that the firm expects that their competitors will also cut their prices but not raise prices. Thus, to the left of the kink, the demand curve has a greater elasticity than at points to the right.
6. Simple one: Total Cost (TC) of a product is comprised of various components. Which of the following options describes TC most accurately?

Answer: Total Fixed Cost + Total Variable Cost

TC = TFC +TVC. When plotting a graph, TFC will be a straight line (provided fixed investment is made only at the start of the firm), and TVC will move up from left to right starting from (0,0). TC can be obtained by drawing a parallel line to TFC starting from the start of the TFC line.
7. Who said, "Supply creates its own demand"?

Answer: J.B Say

Better known as Say's Law, this is one of the reasons for the great Depression in the U.S.A. It was debunked by Keynes. Some of the implications of this theory were -
(1) Automatic adjustment of every element in an economy
(2) General overproduction not possible
(3) No general unemployment etc
8. In simplistic terms, what is the difference between Production and Consumption in an economy better known as?

Answer: Capital formation

Production - Consumption = Capital formation. What it means is that those goods which are not consumed contribute to the capital formation in an economy.
9. This type of unemployment is due to the operation of the business cycle. It is generally suffered by Capitalist countries. It is also called 'Keynesian Unemployment'. What is this type of unemployment better known as?

Answer: Cyclical Unemployment

It happens when aggregate effective demand (Macro economics) of the community becomes deficient in relation to the productive capacity of the country. It can be eliminated, or at least reduced, by increasing expenditure on consumption and investing more in economy.
10. Who first introduced the concept of 'multiplier'?

Answer: Keynes

Keynes brought about this concept in 1929. It was further developed by R.F Kahn in 1931. Kahn's multiplier was actually an 'employment' multiplier, not an 'investment' multiplier.
'Investment Multiplier is the ratio of change in income (revenue) to change in investment'. Multiplier is generally denoted by the letter 'K'.
Source: Author ace_sodium

This quiz was reviewed by FunTrivia editor Linda1 before going online.
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