APPLIED ECONOMICS EXAM

By Raven Emilia

Those that cannot be readily changed during the time period under consideration except at
a very great expense.

Select one:
a. Inputs
b. Outputs
c. Variable Inputs
d. Fixed Inputs

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.

Select one:
a. Cooperative
b. Corporation
c. Sole Proprietorship
d. Partnership

The combined production of several units of a given set of inputs.

Select one:
a. Marginal Utility
b. Marginal product
c. Total Product
d. Total Utility

This includes a look at the population size, the geography of the place where business will
be located, land distribution, climate, and today’s global warming situation, whether or not
the area is prone to flood or earthquake.
Select one:
a. Cultures and Lifestyles
b. Physical Environment
c. Political Factors
d. Economic Forces

Production is the transformation of inputs into outputs of goods & services.

Select one:
True
False
It studies the conditions in an industry at a particular time, including the behavior of and
relations between competitors, suppliers, and customers.
Select one:
a. SWOT Analysis
b. HERFINDAHL-HIRSCHMAN INDEX (HHI)
c. Industrial analysis
d. Environmental Analysis

An equation showing the maximum output of a commodity that a firm can produce per
period of time with each set of inputs.
Answer: Production Function

It refers to the additional utility derived from consuming an additional unit of the good.
Select one:
a. Total product
b. Marginal Utility
c. Marginal product
d. Total Utility

Consumers are a business’ source of raw materials, intermediate goods or final products
and services.

Select one:
True
False

This sector processes raw materials from agriculture, fishery and forestry into intermediate
products which are further processed into final products.

Select one:
a. Trade and Transport
b. Service Sector
c. Manufacturing
d. Industrial Sector

Production refers to the use of goods and services to satisfy human wants.
Select one:
True
False
These are domestically produced goods sold to foreign countries.
Select one:
a. Final Goods
b. Intermediate Goods
c. Exports
d. Imports

Consumer Theory describes how consumers make decisions about what to buy given their
income and prices of goods and services.

Select one:
True
False

It refers to the average contribution per unit of input and is equal to TP/i.

Select one:
a. Total Utility
b. Marginal Utility
c. Total Product
d. Average Product

It is a legal entity that is separate from its owners, the shareholders. No shareholder is
personally liable for the debts, obligations or acts of the corporation.
Select one:
a. Sole Proprietorship
b. Partnership
c. Cooperative
d. Corporation

A Business with total assets worth from P15,000,001 to P60,000,000. Large scale business is
one with total assets in excess of P60,000,000.
Select one:
a. Large Business
b. Small Business
c. Micro Business
d. Medium Business
It is a tool that lists the strengths, weaknesses, opportunities, and threats that face the
business.

Select one:
a. HERFINDAHL-HIRSCHMAN INDEX (HHI)
b. Environmental Analysis
c. Industrial analysis
d. SWOT Analysis

Goods that are ready for direct consumption and are then sold to customers for their use.

Select one:
a. Imports
b. Intermediate Goods
c. Final Goods
d. Exports

The basic facilities, services and installations needed for the functioning of a community or
society.
Answer: Infrastructure

The basic consuming unit, makes use of goods and services which are available in the
economy.

Answer: Household

It refers to the combined utility derived from consuming certain units of a good.

Select one:
a. Marginal Product
b. Marginal Utility
c. Total utility
d. Total Product

It shows the relationship between utility and consumption.

Answer: Utility Function

It produces the intangibles supporting and complementing production in the other sectors
as well as among its own industries.

Select one:
a. Industrial Sector
b. Manufacturing
c. Trade and Transport
d. Service Sector
The Law of Diminishing Marginal Utility states that as additional units of a good are
consumed, the additional utility derived from each additional unit tends to diminish, while
keeping consumption of other goods constant.

Select one:
True
False

Those that can be changed easily and on short notice.

Select one:
a. Input
b. Variable Inputs
c. Output
d. Fixed inputs

The commonly accepted measure of market concentration. It is calculated by squaring the

market share of each firm competing in a market, and then summing the resulting numbers.
Select one:
a. Industrial analysis
b. SWOT Analysis
c. Environmental Analysis
d. HERFINDAHL-HIRSCHMAN INDEX (HHI)

A form of business organization in which two or more persons combine their resources in a
business with a view to making profit.
Select one:
a. Cooperative
b. Partnership
c. Corporation
d. Sole Proprietorship

t is an aggregation of the different businesses engaged in the same kind of undertaking.

Answer: Affiliated Companies

The term used for satisfaction derived from consuming a good/service.

Answer: Utility

The Law of Diminishing Marginal Returns states that additional output starts to diminish at a
certain point as additional units of a variable input are combined with one or more fixed
inputs.

Select one:
True
False
A principle or body of principles to guide decisions and achieve rational outcomes.
Answer: Policy

The value of a particular monetary unit in terms of the goods and services that it can buy.
Answer: Purchasing Power

This is undertaking by a person or a group of persons who are partners, or of stockholders

who own a juridical entity known as a corporation whose main objective is to earn profit for
owners.
Answer: Corporate

A Business with total assets worth from P1,500,001 to P15,000,000.

Select one:
a. Micro Business
b. Large Business
c. Medium Business
d. Small Business

Retailers are wholesalers or brokers who buy in big quantities from manufacturers, add a
mark-up to their purchase price and sell to distributors.

Select one:
True
False

A business with total assets worth below P1,500,001.

Select one:
a. Small Business
b. Medium business
c. Micro Business
d. Large Business

It is the basic producing unit, delivers the goods and services to the household for its
consumption.
Answer: Producers

A form of business organization that is owned by a single individual who is singly

responsible for running the business and is accountable for all debts and obligations related
to the business.

Select one:
a. Sole Proprietorship
b. Cooperation
c. Corporation
d. Partnership
The product created as a result of the combination of inputs in the production process.
Select one:
a. Fixed Inputs
b. Input
c. Variable inputs
d. Output

A written estimate of anticipated government revenues and expenditures during a specific

period of time.

Select one:
a. National Budget
b. International Budget
c. City Budget
d. Provincial Budget

Refers to an evaluation of the possible or probable effects of external forces and conditions
on the survival and growth of the business.
Answer: Environmental Analysis

These are unprocessed goods like raw materials, logs, and wheat, they are materials
extracted from their sources and do not undergo any process of production.
Select one:
a. Import Goods
b. Raw Materials
c. Final Goods
d. Intermediate Goods

An act or process of trying to get or win something over one’s rivals.

Answer: Competition

This involves a look at economic factors such as income of the people, specifically the target
market, economic conditions such as inflation, recession, prosperity, demand, and supply in
the market.

Select one:
a. Economic Forces
b. Physical Environment
c. Political Factors
d. Cultures and Lifestyles
Target market refers to the group of customers the business aims to cater to.
Select one:
True
False

The additional output produced by an additional unit of the input and is equal to TP/ i.
Select one:
a. Marginal Utility
b. Total product
c. Marginal Product
d. Total Utility

It refers to goods purchased from a foreign country

Select one:
a. Final Goods
b. Intermediate Goods
c. Exports
d. Imports

A regular payment, usually on an hourly, daily or weekly basis, made by an employer to an

employee, especially for manual labor.
Answer: Wage

These are semi-processed goods which are not ready for final use by the consumer, which
have undergone some processing but need to go through additional processing before they
can be actually used by the consumer. These are supplied to final good firms for conversion
into goods in their finished stage.

Select one:
a. Intermediate Goods
b. Exports
c. Final Goods
d. Imports

The resources used in the production of goods & services. It refers to the use of economic
resources to create goods and services that will be used to satisfy human wants.

Select one:
a. Variable Inputs
b. Inputs
c. Outputs
d. Fixed Inputs
Consumer Theory describes how consumers make decisions about what to buy given their
income and prices of goods and services.

Select one:
True
False