As more of the same output such as labor is employed in the production of soap, the corresponding increase in total output tends to become smaller and smaller, ceteris paribus.

a.Law of diminishing returns

b.Law of supply and demand

c.Elasticity

d.Opportunity cost

What does elastic demand mean in a perfectly competitive market?

a.A change in the amount of production of a Pc firms is too insignificant to influence a change in the market price

b.All of the choices

c.When a Pc firm increases price it would experience an increase in sales.

d.Goods produced in the perfectly competitive market have no close substitute as alternative for consumers

What does the government implement to protect the producer's income during the existence of production surplus?

a.Price floor

b.Price control

c.Price celling

d.The government absorbs the surplus

The law of supply is best illustrated by which of the following scenarios?

a.Magnolia decrease the supply of chicken due to the increase in price of chicken

b.Del monte increased the supply of pineapple juice due to the decrease in labor cost

c.Procter and gamble increased the supply of tide due to the price increase of laundry soap

d.A furniture shop decreased the supply of wooden chair due to the decrease in wood supply

When graphed, marginal product and average product intersects at

a.Maximum height of marginal product

b.Maximum height of average product

c.Minimum height of average product and Maximum height of marginal product

d.Maximum height of average product and Minimum height of marginal product

Which of the following statement is true?

a.GNP are goods produces within the territorial boundaries of the country using domestically owned factors of production

b.Total payments to all the production factors equals GNP

c.GNP can be computed as the sum of all the value added of all the enterprise in each stage of production

d.GNP = C + I + G + (X-M)

During budget deficits the government resort to borrowing. From which local financial institutions should the government borrow in order not to cause an inflationary borrowing?

a.Commercial banks

b.Central banks

c.Central bank and other lending agencies

d.Commercial banks and other lending agencies

e.Central and commercial banks

f.Other private lending agencies

According to statistics, the Philippine natural resources have started to be depleted due to the increase in population. Which of the four common economic goals should be prioritized by the government?

a.Balance foreign exchange

b.Equitable distribution of income and wealth among individuals and regions

c.Increase in per capital income

d.Full employment and/or development of its resources

Price of a commodity is the principle determinant of production in

a.Combination of command economy and market economy

b.Tradition economy