This quiz works best with JavaScript enabled. Home > General Knowledge > Economy > Business > Business Economics – Quiz 1 🏠 Homepage 📘 Download PDF Books 📕 Premium PDF Books Business Economics Quiz 1 (60 MCQs) Quiz Instructions Select an option to see the correct answer instantly. 1. Which type of business allows the owner to keep all of the profit for him/herself? A) Sole Trader. B) Franchise. C) Partnership. D) Limited Company. Show Answer Correct Answer: A) Sole Trader. 2. Why are resources considered limited? A) Everyone has them, and they change. B) Entrepreneurs do not invest enough of them. C) There are so many that people must decide which ones to choose at any one time. D) There are not enough available so that everyone can have as much of them as desired. Show Answer Correct Answer: D) There are not enough available so that everyone can have as much of them as desired. 3. The difference between what a consumer is ready to pay and what he actually pays is: A) Consumer Surplus. B) Consumer deficit. C) Both. D) None. Show Answer Correct Answer: A) Consumer Surplus. 4. If a customer shops at your store because it is on his way home from work, which utility is involved A) Form. B) Place. C) Time. D) Possession. Show Answer Correct Answer: B) Place. 5. When was Niti Aayog established? A) 1 July 2015. B) 1 January 2015. C) 14 May 2014. D) 25 January 2016. Show Answer Correct Answer: B) 1 January 2015. 6. What is NOT a source of income? A) Social welfare payments. B) Profit from capital. C) Wage from labour. D) Rent from land. Show Answer Correct Answer: B) Profit from capital. 7. A target market is A) A market available at target. B) A group of people who all buy the exact same goods and services. C) A group of producers who have similar interests and therefore join in a partnership business. D) A group of customers with similar characteristics towards which a business has decided to aim its marketing efforts and its products. Show Answer Correct Answer: D) A group of customers with similar characteristics towards which a business has decided to aim its marketing efforts and its products. 8. Products and services are bought and sold at a/an ..... A) Arena. B) Black-market. C) Marketplace. D) Stalls. Show Answer Correct Answer: C) Marketplace. 9. Land, Labor, Capital, and Entrepreneurship A) Deductions. B) Diversification. C) Factors of Production. D) Portfolio. Show Answer Correct Answer: C) Factors of Production. 10. Of the three types of businesses, which one provides the most jobs? (Hint:Which one is the most common? ) A) Corporation. B) Partnership. C) Sole proprietorship. D) None of these are correct. Show Answer Correct Answer: C) Sole proprietorship. 11. For consumption to occur, goods and services must be A) Produced. B) Exchanged. C) Improved. D) Specialized. Show Answer Correct Answer: A) Produced. 12. A ..... is a semi-independent business that pays fees to a parent company. A) Proprietorship. B) Partnership. C) Corporation. D) Franchise. Show Answer Correct Answer: D) Franchise. 13. An increase in the average prices of goods and services in a country. A) Deflation. B) Inflation. C) Market price. D) Demand price. Show Answer Correct Answer: B) Inflation. 14. The target rate for inflation is? A) 3-4%. B) 4-5%. C) 1-2%. D) 2-3%. Show Answer Correct Answer: D) 2-3%. 15. What do consumers, producers, and the owners of resources do with money payments to create a flow of resources, goods, services, and money payments? A) Consume. B) Exchange. C) Produce. D) Distribute. Show Answer Correct Answer: B) Exchange. 16. Exports are ..... A) Goods and services that are purchased from overseas businesses. B) Goods and services that are exported to overseas governments. C) Goods and services that are sold domestically to the household sector. D) Goods and services sold by local businesses to overseas consumers. Show Answer Correct Answer: D) Goods and services sold by local businesses to overseas consumers. 17. Law of demand shows relation between: A) 1.Income and price of commodity. B) 2.Price and quantity of a commodity. C) 3.Income and quantity demand. D) 4.Quantity demanded and quantity supplied. Show Answer Correct Answer: B) 2.Price and quantity of a commodity. 18. What is Business Studies? A) This is the study of how businesses are formed, how they grow & how the operate/managed. B) This is the study of how human beings behave as they satisfy their unlimited wants and needs. C) This is the value of the next best alternative forgone. D) None of above. Show Answer Correct Answer: A) This is the study of how businesses are formed, how they grow & how the operate/managed. 19. The type of government where the government or a central-planning committee regulates the amount, distribution, and price of everything produced. A) Command economy. B) Mixed economy. C) Market economy. D) None of above. Show Answer Correct Answer: A) Command economy. 20. Goods and services are produced using ..... A) Economic Resources. B) Needs. C) Wants. D) Economic Problem. Show Answer Correct Answer: A) Economic Resources. 21. Oil, water, and wood are examples of ..... resources. A) Land. B) Labor. C) Capital. D) Entrepreneurship. Show Answer Correct Answer: A) Land. 22. The result of merging companies that produce unrelated goods and services A) Horizontal merger. B) Depreciation. C) Multinational. D) Conglomerate. E) Vertical merger. Show Answer Correct Answer: D) Conglomerate. 23. Under capitalist economies, the answer to the fundamental questions-what, how and for whom to produce are obtained by- A) Government regulation. B) Cost benefit analysis. C) Market forces of demand and supply. D) All of the above. Show Answer Correct Answer: C) Market forces of demand and supply. 24. What is the focus of Microeconomics? A) How businesses make decisions. B) How government manages the economy. C) How individual consumers and firms make economic decisions. D) None of above. Show Answer Correct Answer: C) How individual consumers and firms make economic decisions. 25. What does the scarcity of resource implies ..... A) We must develop way to decrease our individual wants. B) Not all wants can be satisfied. C) Resources can not satisfy any want. D) Resources are very scarce and shall not be used at all. Show Answer Correct Answer: B) Not all wants can be satisfied. 26. Labour intensive technique would get chosen in ..... A) Capital surplus economy. B) Developed economy. C) Developing economy. D) Labour surplus economy. Show Answer Correct Answer: D) Labour surplus economy. 27. Capitalist economy is also known as- A) Controlled market economy. B) Free market economy. C) Both (1) and (2). D) Neither (1) Nor (2). Show Answer Correct Answer: B) Free market economy. 28. Voluntary association that buys bulk amounts of goods on behalf of its members A) Unlimited liability. B) Consumer cooperative. C) Partnership. D) Depreciation. Show Answer Correct Answer: B) Consumer cooperative. 29. Indifference curves between income and leisure for an individual are generally: A) Concave to the origin. B) Positively sloped straight lines. C) Convex to the origin. D) Negatively sloped straight lines. Show Answer Correct Answer: B) Positively sloped straight lines. 30. Economies of scale are those that A) Reduce production costs in the short run. B) Generate lower per unit production costs. C) Increase due to the growth of the industry as a whole. D) Result from changes in production techniques. Show Answer Correct Answer: B) Generate lower per unit production costs. 31. The value of one nation's currency versus the currency of another nation is called ..... A) Balance of payments. B) Recession. C) Growth. D) Exchange rate. Show Answer Correct Answer: D) Exchange rate. 32. Is time an investment? A) Undecided. B) Yes. C) No. D) None of above. Show Answer Correct Answer: B) Yes. 33. Which economic system is based on customs and beliefs? A) Traditional System. B) Market System. C) Mixed System. D) Command System. Show Answer Correct Answer: A) Traditional System. 34. Deflation is defined as a decline in the ..... A) Price of certain products. B) Gross domestic product. C) Innovation. D) General price level.. Show Answer Correct Answer: D) General price level.. 35. Economics is "On the one side, a study of wealth; and on the other, and more important side, part of a study of man" . This is stated by A) Adam Smith. B) Alfred Marshall. C) Robbins. D) Samuelson. Show Answer Correct Answer: B) Alfred Marshall. 36. Sole proprietorship can best be defined as ..... A) A business owned and run by a single individual. B) Business organization recognized by law as separate legal entity with all the rights of an individual. C) Two individuals owning stock. D) Stockholders joined under contract. Show Answer Correct Answer: A) A business owned and run by a single individual. 37. Horizontal mergers involve A) Two or more firms in different countries. B) Two or more firms that produce different products. C) Two or more firms involved in different steps of manufacturing or marketing. D) Two or more firms that produce the same kind of product. Show Answer Correct Answer: D) Two or more firms that produce the same kind of product. 38. Is the price that equates quantity supplied to the quantity demanded A) 1.equilibrium price. B) 2.surplus. C) 3.shortage. D) 4. none of the above. Show Answer Correct Answer: A) 1.equilibrium price. 39. Parastatals are business entities of a ..... sector. A) Commercial. B) Public. C) Sector. D) Private. Show Answer Correct Answer: D) Private. 40. ..... is the base of marketing planning A) Demand Estimation. B) Demand analysis. C) Demand function. D) Demand forecasting. Show Answer Correct Answer: D) Demand forecasting. 41. Which is a disadvantage of corporations? A) Difficulty of raising financial capital. B) The difficulty and expense of getting a charter. C) Lack of separate taxes in a partnership. D) Potential for conflict between partners. Show Answer Correct Answer: B) The difficulty and expense of getting a charter. 42. Things require to survive are categorised as ..... A) Demands. B) Wants. C) Needs. D) Desires. Show Answer Correct Answer: C) Needs. 43. ..... is a branch of economics that deals with aggregate economic variables, such as the level and growth rate of national output, interest rates, unemployment and inflation A) 4. Market Economies. B) 3. Macroeconomics. C) 2. Statistics. D) 1. Microeconomics. Show Answer Correct Answer: B) 3. Macroeconomics. 44. This is a method used by a business to find attributes that is important and to set them apart itself from its competitors. A) Differentiation. B) Cost leadership. C) Alliance. D) Defensive strategy. Show Answer Correct Answer: A) Differentiation. 45. The four (4) participants in our economy are ..... A) Producers, Consumers, Students, Governments. B) Consumers, Producers, Households, Employees. C) Households, Firms, Governments, Employees. D) Consumers, Producers, Employees, Governments. Show Answer Correct Answer: D) Consumers, Producers, Employees, Governments. 46. Country with little economic wealth and an emphasis on agriculture or mining. A) Less-developed country. B) Developing country. C) Industrialized country. D) None of above. Show Answer Correct Answer: A) Less-developed country. 47. A command economic system is characterized by: A) Reliance on the forces of supply and demand to determine what is produced. B) Reliance on the government to determine what is produced and who gets the output. C) An extremely rapid rate of economic growth. D) Freedom of choice and freedom of competition. Show Answer Correct Answer: B) Reliance on the government to determine what is produced and who gets the output. 48. Two local business owners want to reduce competition, so they decide to form one organization from the two companies. This is an example of a A) Hostile takeover. B) Trading bloc. C) Merger. D) Monopoly. Show Answer Correct Answer: C) Merger. 49. Something we must have in order to survive A) Need. B) Want. C) Consumer. D) Producer good. Show Answer Correct Answer: A) Need. 50. A study of how increase in the corporate income tax rate will affect the national unemployment rate isan example of ..... A) Macro-Economics. B) Descriptive Economics. C) Normative economics. D) Micro-economics. Show Answer Correct Answer: A) Macro-Economics. 51. Internal things that may limit a company's ability to achieve it's goals would be known as a A) Weakness. B) Threat. C) Strength. D) Opportunity. Show Answer Correct Answer: A) Weakness. 52. A ..... is a check that transfers a portion of the corporate earnings to an individual. A) Bonus. B) Stock. C) Dividend. D) Payment. Show Answer Correct Answer: C) Dividend. 53. What is the fundamental problem of economics? A) How to keep consumers out of debt?. B) How to fulfill our unlimited wants and needs with limited resources?. C) How to figure out the way to make the most money?. D) How do we ensure all people get a college education?. Show Answer Correct Answer: B) How to fulfill our unlimited wants and needs with limited resources?. 54. A garbage truck driver is an example of which Factor of Production? A) Labor. B) Land. C) Entrepreneurship. D) Capital. Show Answer Correct Answer: A) Labor. 55. Which of the following is NOT one of the five types of businesses A) Wholesaling. B) Service. C) Manufacturing. D) Selling. Show Answer Correct Answer: D) Selling. 56. Anything that can be bought and sold. A) Factors of Production. B) Customer. C) Product. D) None of above. Show Answer Correct Answer: C) Product. 57. The condition of consumer equilibrium under cardinal approach in case of one commodity is A) Price of commodity should be rising. B) Price of commodity should equal to be marginal utility. C) Price of commodity should be decreasing. D) None of these. Show Answer Correct Answer: B) Price of commodity should equal to be marginal utility. 58. A type of stock without voting privileges A) Common. B) Preferred. C) Uncommon. D) Dividend. Show Answer Correct Answer: B) Preferred. 59. Consider the following and decide which, if any, economy is without scarcity: A) The pre-independent Indian economy, where most people were farmers. B) A mythical economy where everybody is a billionaire. C) Any economy where income is distributed equally among its people. D) None of the above. Show Answer Correct Answer: D) None of the above. 60. This factor of production are the raw materials that come from the earth. A) Capital. B) Entrepreneurship. C) Human Resources. D) Natural Resources. Show Answer Correct Answer: D) Natural Resources. Next →Related QuizzesEconomy QuizzesGeneral Knowledge QuizzesBusiness Economics Quiz 2Business Economics Quiz 3Business Economics Quiz 4Business Economics Quiz 5Business Economics Quiz 6Business Economics Quiz 7Business Economics Quiz 8Business Economics Quiz 9 🏠 Back to Homepage 📘 Download PDF Books 📕 Premium PDF Books