DIAGNOSTIC EXAM

APPLIED ECONOMICS

1. Study of how societies use scarce resources to produce valuable commodities and distribute them among different
people. A. Management B. Economics C. Marketing D. Science
2. The Greek word of “economics”, A. Land B. Capitolyo C. Oikonomia D. Oikonomiya
3. It refers to the machines, factories, transportation, equipment and infrastructure. A. Building B. Capital C. Labor D.
Land
4. It is the one who organize the factors of production and he is also a risk taker. A Capital B. Land C. Entrepreneur D.
Labor
5. It refers to the skilled, semiskilled and professional. A. Labor B. Capital C. Land D. Entrepreneur
6. ___________ refers to a physical condition wherein the quantity desired of a particular resource exceeds the
quantity available in the absence of a rationing system. A. Limited B. Scarce C. Unlimited D. Resources
7. The products that are directly consumed by individuals to satisfy their needs and wants. A. Final Goods and
Services B. Product C. End user D. Final User
8. ___________ refers to those goods and services required for human survival. A. Wants B. Needs C. Resources D.
Foods
9. ___________ deals with the behavior of individual component as an economic agent such as household, consumer,
worker, firm and individual owner of production. A. Social Science B. Aggregate C. Macroeconomics D.
Microeconomics
10. __________ deals with the behavior of the economy as a whole with the view to understand the interaction between
economic aggregate such as employment, inflation, and national income. A. Aggregates B. Inflation C.
Macroeconomics D. Microeconomics
11. Tools in economics the deals with “what should be done” A. Macroeconomics B. Microeconomics C. Normative
Economics D. Positive Economics
12. Economic decisions are made with great influence from the past because it is copying/duplicating the decision made
by previous generations. A. Command Economy B. Free Market Economy C. Mixed Market Economy D. Traditional
Economy
13. It refers to an individual consumer and businesses interact to solve the economics problems. A. Command
Economy B. Free Market Economy C. Mixed Market Economy D. Traditional Economy
14. Economic system that society uses in allocating the scarce resources wherein the factors of production and
distribution are owned and managed by the state because decision in answering the basic economic problems are
planned. A. Command Economy B. Free Market Economy C. Mixed Market Economy D. Traditional Economy
15. The total value of goods and services within a country divided by the total population. A. GNP B. GDP C. Income D.
Products
16. The total values of all final goods and services produced within a nation in a particular year and the income earned
by the citizens. A. GNP B. GDP C. Income D. Products
17. It was designed to measure the non-economic indicators of well-beings such as literacy, child mortality rates,
shelter, access to water etc. A. Market Index B. People Index C. Social Progress Index D. Social Economic Index
18. _________ refers to all natural resources – such as raw materials, land, minerals, forest, water and climate used in
the productive process. A Labor B. Human C. Natural Resources D. Land
19. Investment goods used to produce other goods and services. A Land B. Labor C. Capital D. Management
20. __________It is a physical and mental efforts that people make it available for production. A Land B. Labor C.
Capital D. Management
21. _________ means that while certain variables change, “all other things remain unchanged” A. Oikonomia B. Ceteris
Paribus C. Locus Control D. Spatial
22. The schedule of an individual for a commodity is a list or tables of the different amounts of the commodity that are
purchased in the market at different prices per unit of time. A supply B. Law of Supply C. Demand D. Law of
Demand
23. Graphic presentation of the demand schedule. A Supply Curve B. Demand Curve C. Quantity Supplied D. Quantity
Demanded
24. It states that as the price increases the QS also increases and vice versa. A. Demand Curve D. Supply Curve C.
Law of Supply D. Law of Demand
25. It measures how responsive or sensitive the buyers to a change in price. A Elasticity of Demand B. Elasticity of
Supply C. Inelastic Demand D. Inelastic Supply
26. It is the process by which the differentiation of a product’s supply bases is weakened. A Competitive Markets B.
Price Market C. Commodity D. Commoditization
27. __________ is the presence of many sellers that essentially sell the same product. A. Markets B. Price Market C.
Competitive Markets D. Dry and Wet Market
28. It is the actual size of the population. According to the POPCOM the estimated total population of the Philippines as
of January is 103,414,423. A. Population B. Labor Force C. Total Population D. Total Labor Force
29. In the “wealth of the nation” 1776 __________ argued that wage were determined in the marketplace through the
law of supply and demand. A, David Ricardo B. Adam Smith C. Uriel Ancheta D. John Stuart Mill
30. __________ Filipinos who are not properly documented or without valid residence or work permits, or who may be
overstaying their VISA. A. OFW B. Permanent Migrants C. Temporary Migrants D. Irregular Migrants
31. Filipinos whose stay overseas, while regular and properly documented is not permanent. A. OFW B. Permanent
Migrants C. Temporary Migrants D. Irregular Migrants
32. The idea in economics that “there is no free lunch” means that. A. Business would lose money if they offered free
lunches B. The thought of a free lunch is often than the reality of consuming it C. There are always opportunity costs
when scarce resources are used to prepare lunches D. Business use free lunches to attract customers but this
advertising practice is costly
33. As a result of a decrease in the price of hamburger, producers reduce the supply of hamburger. This is an
illustration of: A. Shift in the supply curve due to the price effect. B. Changing production in response to resource
cost changes C. The desire of producers to restrict supply to maximize their profits D. A movement along the supply
curve
34. Which of the following is most likely to cause an increase (shift) in the supply curve for cell phones? A. A decrease
in the rates charged by cell phone companies for using cell phone B. An elimination of tariffs on imported cell
phones C. Manufacturers of cell phone decided to raise the price of cell phone D. A decrease in the rates charged
by companies that provide “landline” services
35. A remote island is discovered in the Philippines, and on this island the cross elasticity of demand for coconut milk
and pineapple is 1.0. This indicates that these two goods are. A. Normal B. Inferior C. Complements D. Substitutes
36. Markets that are controlled by one seller only. A Oligopoly b. Monopolistic C. Perfect D. Monopoly
37. It is the most common type of market and the most realistic type of market, it has several producers and customers.
A Oligopoly b. Monopolistic C. Perfect D. Monopoly
38. Examples of this markets are smartphones, health insurance companies, pharmaceutical companies and airlines
companies. A Oligopoly b. Monopolistic C. Perfect D. Monopoly
39. IT seeks to change the current tax system to make it simpler, fairer and more efficient. A. Tax Reform B.
Acceleration Law C. TRAIN Law D. TRADE Law
40. This technique examines the business domains or industry within which an organization operates, and identifies the
business pressures that maybe brought to bear upon that organization. A. PESTLE Analysis B. POLITICAL Analysis
C. Porter’s Five Forces Framework D. Conceptual Framework
41. It provides a framework for investigating and analyzing the external environment for an organization. A. PESTLE
Analysis B. POLITICAL Analysis C. Porter’s Five Forces Framework D. Conceptual Framework
42. _________ industry is revolved in extraction of raw materials from the earth. A. Secondary B. Tertiary C. Primary D.
Multiple
43. _________ is responsible for converting the raw material obtained by the primary industry into finished goods. A.
Secondary B. Tertiary C. Multiple
44. _________ is the least popular among the industries but it became one of the most revolutionized among important
industries in the country. A. Secondary B. Tertiary C. Multiple
45. _________ is the industry engaged in the producing operations of a farm, the manufacture and distribution of farm
equipment and supplies and the processing, storage, and distribution of farm commodities. A. Industrial sector B.
Mining Sector C. Service Sector D. Agricultural Sector
46. It refers to major external and uncontrollable factors that influence an organization’s decision making and affects its
performance and strategies. A. Microeconomics B. Macroeconomics C. Macro Environment D. Micro Environment
47. It consist of all elements in or immediately surrounding a business that can affect its performance including its
internal environment, its supplies its marketing intermediaries, its customers, its competitors and its community. A.
Microeconomics B. Macroeconomics C. Macro Environment D. Micro Environment
48. ___________ refers to the general increase in the price level. A. Inflation B. Price Increases C. Commodity Increase
D. Total
49. It is the number one contributor to any economic problem. A. Citizens B. Mediocrity C. Environment D. Elite
50. Learning electronically through the internet, represents a continued strong business opportunity for development of
technology and learning content. A. On Site Computer Service B. Direct Selling C. E Learning D. Online Gaming
51. It consists of big firms, small boutique shops and independent consultant. A. Online gaming B. Management
Consulting C. On Site Computer Service D. Contractor Referral Service
52. _________ status reflects the educational attainment required to obtain the job and income levels that vary with
different jobs and within ranks of occupation. A. Education B. Qualifications C. Occupation D. Wok/Jobs
53. _________ it is a policy directed primarily at promoting long-term economic growth, rather than cyclical changes or
distributing income. A. Monetary B. Current Policy C. Fiscal Policy D.

54. It is the aggregation of the different business engaged in the same line of undertaking.
a. principal c. industry
b. corporation d. stockholders
55. It is a tool that lists the strengths, weaknesses, opportunities, and threats that face the business.
a. Porter’s Five Forces Analysis c. SWOT analysis
b. SWOT d. Competitive Position Analysis
56. This processes raw materials from agriculture, fishery, and forestry into intermediate products which are
further processed into final products.
a. industrial sector c. agriculture, fishery, & forestry sector
b. economic sector d. service sector
57. This produces the intangibles supporting and complementing production in the other sectors as well as
among its own industries.
a. industrial sector c. agriculture, fishery, & forestry sector
b. economic sector d. service sector
58. In a global setting, these industries are the least competitive despite the country’s natural resources mainly
due to human factors affecting efficiency.
a. manufacturing c. trade and transport
b. agriculture and fishery d. tourism
59. In spite of the liberalization of foreign investment and trade, the industry is hardly competitive
even in the ASEAN region due to limitations of size and structural support.
a. manufacturing c. trade and transport
 b. agriculture and fishery d. tourism
60. Economics’ comes from two old Greek words - ‘oikon’, which means ‘home’ and ‘nomos’ which means
‘management’.
a. True b. False