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WESTERN MINDANAO ADVENTIST Dumingag, Zamboanga del

ACADEMY Sur
“The School for Better Future” Philippines
APPLIED ECONOMICS
Prelim Examination
July 10, 2019
Name: _______________________________________________ SCORE: ____________
Grade/Section: _______________________
Test I. Identification. Directions: Read and understand each questions. Choose the answer inside the box below. NO
ERASURES!
1. So-called”gifts of nature” used to produce goods and services. ____________________
2. An economic system that mixes aspects of central planning with competitive markets. __________________
3. The set of mechanisms and institutions that resolve the what, how and for whom questions for an economy. _________________
4. Something not physical that requires scarce resources to produce and satisfies human wants. ______________
5. Means by which buyers and sellers carry out exchange. ________________
6. Incremental, additional, extra or one more; refers to a change in an economic variable, a change in the status quo. ______________
7. Study of how people use their scarce resources to satisfy their unlimited wants. ____________
8. Value of the best alternative passed up for the chosen item or activity. ______________
9. A profit seeker who develops a new product. _______________
10. An item you can see, feel and touch that requires scarce resources to produce and satisfies human wants. _____________
11. An economic system in the process of shifting from central planning to competitive markets. _______________
12. All resources are government owned and government officials coordinate productions. ________________
13. An economic system in which private firms account for all production. _________________
14. It plays the leading role in the economy. __________________
15. Study of the economic behavior of the economy as a whole. _______________
16. Physical and mental effort used to produce goods and services. _____________
17. All human creations used to produce goods and services. _____________
18. A condition facing all societies because there are not enough productive resources to satisfy people’s unlimited wants _____________
19. The inputs used to produce the goods and services that people want _____________
20. The sum of the individual demands of all consumers in the market. ______________
21. The amount demanded at a particular price. __________
22. Another word for responsiveness. ___________
23. Measures how responsive quantity demanded is to price change _______________
24. A certain goods are often used in combination _____________
25. Products that can be used in place of each other ____________
Capital goods entrepreneur scarcity market mixed economy human resources
Economics Individuals service natural resources pure market economy productive resources
Economic system sunk cost goods opportunity cost marginal Pure command economy
Traditional Economy Transitional economy household microeconomics macroeconomics
Market demand quantity demanded law of demand elasticity elasticity of demand
Taste Substitutes Complements
Test II. Multiple Choice. Directions: Read and understand carefully the questions. Cross out the wrong letters of each
choice.
NO ERASURES!
1. Choices in food, clothing, books, movies, TV shows are influenced by?
a. Consumer Expectations b. Complements c. Consumer Tastes d. Substitutes
2. If consumers come to believe that home prices will increase next year, some increase their demand for housing this year, shifting the
demand curve for housing rightward.
a. Changes in Consumer Expectation b. Changes that Shift the demand Curve c. Changes in the Prices of Related Goods
3. The additional satisfaction you can get from the second try is what you called?
a. Law of diminishing marginal utility b. law of demand c. substitution effect d. marginal utility
4. A trip to the beach is more fun than warmer clothing.
a. Complement b. Substitution c. Marginal utility
5. As money income increases, consumers switch from these _______ to normal goods.
a. Normal goods b. Complement goods c. Inferior goods d. None of the above
Test III. MODIFIED TRUE OR FALSE. Write True if the statement is correct and False if the statement is wrong then underline the
word or phrase that made it false and write the correct answer after the statement. NO ERASURES!
1. The demand for an inferior goods increases as money income increases. ______________________
2. The main important resources in the economy is the household. ___________________
3. Consumption involves a money price and a time price. ____________________
4. Knowing a product’s elasticity can help businesses with their pricing decisions. ________________
5. Entrepreneurs buy things to increase their satisfaction or utility. _____________
Test IV. Essay. 15 points
1. Many students would like to own an expensive motorcycle. Is this considered demand? Why or why not?
2. Joe is willing to pay P50 for a hamburger after basketball practice but chooses not to purchase a second hamburger for the same price.
How does this illustrate the law of diminishing marginal utility?
3. How do you managed your life using the Circular Flow Model.