Managerial Economics: Multiple-Choice and Analytical
Questions & Answers, Exams of Nursing
Managerial Economics: Multiple-Choice and Analytical
Questions & Answers, Exams of Nursing
Chapter 1
Introduction
i
Multiple-Choice Questions
1) Which Of The Following Is An Example Of How The Question Of "What Goods And
Services ToProduce?" Is Answered By The Command Process?
A) Government Subsidies For Affordable Housing
B) Laws Regarding Equal Opportunity In Employment
C) Government Allowance For The Deduction Of Interest Payments On Private Mortgages
D) Government Regulations Concerning The Dumping Of Industrial
Waste
Correct Answer: A
2) Opportunity Cost Is Best Defined As
A) The Amount Given Up When Choosing One Activity Over All Other Alternatives.
B) The Amount Given Up When Choosing One Activity Over The Next Best Alternative.
C) The Opportunity To Earn A Profit That Is Greater Than The One Currently Being Made.
D) The Amount That Is Given Up When Choosing An Activity That Is Not As Good As
The Next BestAlternative.
Correct Answer: B
3) In A Market Economy, Which Of The Following Is The Most Important Factor Affecting Scarcity?
A) The Needs And Wants Of Consumers
B) The Price Of The Product
pg. 1
, Managerial Economics: Multiple-Choice and Analytical
Questions & Answers, Exams of Nursing
C) The Degree To Which The Government Is Involved In The Allocation Of Resources.
D) All Of The Above Are Equally Important.
Correct Answer: A
4) Which Of The Following Is Not Considered By Economists To Be A Basic Resource Or
Factor OfProduction?
A) Money B) Machinery And Equipment
C) Technology D) Unskilled Labor
Correct Answer: A
5) Select The Group That Best Represents The Basic Factors Of Production.
A) Land, Labor, Capital, Entrepreneurship B) Land, Labor, Money, Management Skills
C) Land, Natural Resources, Labor, Capital D) Land, Labor, Capital,
TechnologyCorrect Answer: A
6) Which Of The Statements Below Best Illustrates The Use Of The Market Process In
Determining TheAllocation Of Scarce Resources?
A) "Let's Make This Product Because This Is What We Know How To Do Best."
B) "Although We're Currently Making A Profit On The Products We Make, We Should
ConsiderShifting To Products Where We Can Earn Even More Money."
C) "Everyone Is Opening Video Stores, Why Don't We?"
D) "We Can't Stop Making This Product. This Product Gave Our Company Its
Start."Correct Answer: B
7) Which Of The Following Is The Best Example Of "What Goods And Services Should Be Produced?"
A) The Use Of A Capital Intensive Versus A Labor Intensive Process Of Manufacturing Textiles
B) The Production Of Army Helicopters Versus The Production Of New Commercial Jet Aircraft
C) The Manufacturing Of Computer Workstations In Hong Kong Or In Germany
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, Managerial Economics: Multiple-Choice and Analytical
Questions & Answers, Exams of Nursing
D) The Leasing Versus The Purchasing Of New Capital
EquipmentCorrect Answer: B
8) Which Of The Following Is The Best Example Of "How Should Goods And Services Be Produced?"
A) Adherence To Technical Specifications In The Production Of Jet Aircraft
B) The Production Of Jet Aircraft For The Air Force Or For A Commercial Airline
C) The Use Of Additional Full-Time Workers Versus The Use Of Supplementary
Part-TimeWorkers
D) The Production Of A New Manufacturing
FacilityCorrect Answer: C
9) Which Of The Following Is The Best Example Of Opportunity Cost?
A) A Company's Expenditures On A Training Program For Its Employees
B) The Rate Of Return On A Company's Investment
C) The Amount Of Money That A Company Can Earn By Depositing Excess Funds In
A MoneyMarket Fund
D) The Amount Of Profit That A Company Forgoes When It Decides To Drop A
Particular ProductLine In Favor Of Another One
Correct Answer: D
10) From The Standpoint Of A Soft Drink Company The Question Of "What Goods And
ServicesShould Be Produced?" Is Best Represented By Which Of The Following
Decisions?
A) Whether Or Not To Hire Additional Workers
B) Whether Or Not To Increase Its Advertising
C) Whether Or Not To Shut Down Selected Manufacturing Facilities
D) All Of The Above Are Examples.
E) None Of The Above Are Examples.
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, Managerial Economics: Multiple-Choice and Analytical
Questions & Answers, Exams of Nursing
Correct Answer: E
11) Scarcity Is A Condition That Exists When
A) There Is A Fixed Supply Of Resources.
B) There Is A Large Demand For A Product.
C) Resources Are Not Able To Meet The Entire Demand For A Product.
D) All Of The Above.
Correct Answer: C
12) Managerial Economics Is Best Defined As
A) The Study Of Economics By Managers.
B) The Study Of The Aggregate Economic Activity.
C) The Study Of How Managers Make Decisions About The Use Of Scarce Resources.
D) All Of The Above Are Good Definitions.
Correct Answer: C
13) In The Text, The Authors Refer To "Stage II" Of The Process Of Changing Economics As
A) Demand Management. B) Cost Management.
C) Diminishing Returns. D) Profit Taking.
Correct Answer: B
pg. 4
Questions & Answers, Exams of Nursing
Managerial Economics: Multiple-Choice and Analytical
Questions & Answers, Exams of Nursing
Chapter 1
Introduction
i
Multiple-Choice Questions
1) Which Of The Following Is An Example Of How The Question Of "What Goods And
Services ToProduce?" Is Answered By The Command Process?
A) Government Subsidies For Affordable Housing
B) Laws Regarding Equal Opportunity In Employment
C) Government Allowance For The Deduction Of Interest Payments On Private Mortgages
D) Government Regulations Concerning The Dumping Of Industrial
Waste
Correct Answer: A
2) Opportunity Cost Is Best Defined As
A) The Amount Given Up When Choosing One Activity Over All Other Alternatives.
B) The Amount Given Up When Choosing One Activity Over The Next Best Alternative.
C) The Opportunity To Earn A Profit That Is Greater Than The One Currently Being Made.
D) The Amount That Is Given Up When Choosing An Activity That Is Not As Good As
The Next BestAlternative.
Correct Answer: B
3) In A Market Economy, Which Of The Following Is The Most Important Factor Affecting Scarcity?
A) The Needs And Wants Of Consumers
B) The Price Of The Product
pg. 1
, Managerial Economics: Multiple-Choice and Analytical
Questions & Answers, Exams of Nursing
C) The Degree To Which The Government Is Involved In The Allocation Of Resources.
D) All Of The Above Are Equally Important.
Correct Answer: A
4) Which Of The Following Is Not Considered By Economists To Be A Basic Resource Or
Factor OfProduction?
A) Money B) Machinery And Equipment
C) Technology D) Unskilled Labor
Correct Answer: A
5) Select The Group That Best Represents The Basic Factors Of Production.
A) Land, Labor, Capital, Entrepreneurship B) Land, Labor, Money, Management Skills
C) Land, Natural Resources, Labor, Capital D) Land, Labor, Capital,
TechnologyCorrect Answer: A
6) Which Of The Statements Below Best Illustrates The Use Of The Market Process In
Determining TheAllocation Of Scarce Resources?
A) "Let's Make This Product Because This Is What We Know How To Do Best."
B) "Although We're Currently Making A Profit On The Products We Make, We Should
ConsiderShifting To Products Where We Can Earn Even More Money."
C) "Everyone Is Opening Video Stores, Why Don't We?"
D) "We Can't Stop Making This Product. This Product Gave Our Company Its
Start."Correct Answer: B
7) Which Of The Following Is The Best Example Of "What Goods And Services Should Be Produced?"
A) The Use Of A Capital Intensive Versus A Labor Intensive Process Of Manufacturing Textiles
B) The Production Of Army Helicopters Versus The Production Of New Commercial Jet Aircraft
C) The Manufacturing Of Computer Workstations In Hong Kong Or In Germany
pg. 2
, Managerial Economics: Multiple-Choice and Analytical
Questions & Answers, Exams of Nursing
D) The Leasing Versus The Purchasing Of New Capital
EquipmentCorrect Answer: B
8) Which Of The Following Is The Best Example Of "How Should Goods And Services Be Produced?"
A) Adherence To Technical Specifications In The Production Of Jet Aircraft
B) The Production Of Jet Aircraft For The Air Force Or For A Commercial Airline
C) The Use Of Additional Full-Time Workers Versus The Use Of Supplementary
Part-TimeWorkers
D) The Production Of A New Manufacturing
FacilityCorrect Answer: C
9) Which Of The Following Is The Best Example Of Opportunity Cost?
A) A Company's Expenditures On A Training Program For Its Employees
B) The Rate Of Return On A Company's Investment
C) The Amount Of Money That A Company Can Earn By Depositing Excess Funds In
A MoneyMarket Fund
D) The Amount Of Profit That A Company Forgoes When It Decides To Drop A
Particular ProductLine In Favor Of Another One
Correct Answer: D
10) From The Standpoint Of A Soft Drink Company The Question Of "What Goods And
ServicesShould Be Produced?" Is Best Represented By Which Of The Following
Decisions?
A) Whether Or Not To Hire Additional Workers
B) Whether Or Not To Increase Its Advertising
C) Whether Or Not To Shut Down Selected Manufacturing Facilities
D) All Of The Above Are Examples.
E) None Of The Above Are Examples.
pg. 3
, Managerial Economics: Multiple-Choice and Analytical
Questions & Answers, Exams of Nursing
Correct Answer: E
11) Scarcity Is A Condition That Exists When
A) There Is A Fixed Supply Of Resources.
B) There Is A Large Demand For A Product.
C) Resources Are Not Able To Meet The Entire Demand For A Product.
D) All Of The Above.
Correct Answer: C
12) Managerial Economics Is Best Defined As
A) The Study Of Economics By Managers.
B) The Study Of The Aggregate Economic Activity.
C) The Study Of How Managers Make Decisions About The Use Of Scarce Resources.
D) All Of The Above Are Good Definitions.
Correct Answer: C
13) In The Text, The Authors Refer To "Stage II" Of The Process Of Changing Economics As
A) Demand Management. B) Cost Management.
C) Diminishing Returns. D) Profit Taking.
Correct Answer: B
pg. 4
