Topics in EconomicsAdvantages of Inflation Disadvantages of Inflation Concept of Inflation in Economics Scheme of work for Economics, SS1, First Term Scheme of work for Economics, SS1, Second Term Scheme of Work for Economics, SS1, Third Term Functions of the Wholesaler Advantages and Disadvantages of the Wholesaler Wholesale Market: Who is a Wholesaler? Characteristics of the Wholesaler Retail Market: Who is a Retailer and Examples of Retailers Market: Types of Market Market - What is a Market in Economics? Elasticity of Supply: Types of Supply Elasticity Supply Elasticity: Elasticity of Supply explained Demand Schedule - Types of Demand Schedule Demand: What is Demand? Law of Demand Concept and Types of Cost Supply, Supply Curve and Law of Supply What is a Black Market, Its advantages and disadvantages
Academic Questions in Economics
Concerning demand curve, which of the following statement is incorrect?
A. It is a graphical represention of a table showing the price of commodities and quantity demanded
B. It can be an individual demand curve
C. The x-axis shows the price of commodities
D. The price and quantity demanded are expressed on different axis of the graph
E. It can be a market demand curve
F. All the options are correct
A table that shows the price of a commodity and the quantity demanded is termed _____.
A. Price table
B. Demand table
C. Demanded-price table
D. Demand preference table
E. Demand graph
F. Demand schedule
The concept of Ceteris Paribus Assumption in economics states that _____.
A. Supply and Demand are antagonistic
B. When given two choice of similar products with the same price (assuming all other factors are constant), you will prefer to buy that with a lower price
C. Supply and Demand are agonistic
D. When given two choice of dissimilar products with the same price (assuming all other factors are constant), you will prefer to buy that which you need most
E. When given two choice of similar products with the different prices (assuming all other factors are constant), you will prefer to buy that with a lower price
F. When given two choice of dissimilar products with the different prices (assuming all other factors are constant), you will prefer to buy that with a lower price
The willingness of a person to buy a specific quantity of goods or services at a given price and time is termed _____.
A. Scale of preference
B. Economies of scale
C. Opportunity Cost
Costs generally treated as expenses in business are termed _____.
A. Fixed cost
B. Variable cost
C. Sunk cost
D. Direct cost
E. Private cost
F. Outlay cost
When an entrepreneur pays cash (money) for materials needed for production, such money is termed as an _____ cost.
A government mandated maximum price for goods or services is termed _____.
A. Price height
B. Price maxima
C. Price ceiling
D. Price level
E. Price finale
F. Price top-zone
The quantity of supplied services or goods will increase as the price increases and they will decrease as the price decreases provided all other factors remain constant.
The above statement is attributed to the _____.
A. Law of price increase and price decrease
B. Law of product quantity
C. Law of demand
D. Law of supply
E. Law of quantity demanded and supplied in relation to price
F. Law of purchases on services and goods
LEN ACADEMY SMART SCHOOL SOFTWARE
Read more on its smart academic features here
Please click here to kindly support education
Cost can be expressed in various forms. Generally, cost will refer to money spent on a variety of things.
Below are some of the ways we may have spent money:
Recall that both the physical and financial inputs are necessary if we intend to enhance our productivity. Based of this fact, it will be a good idea if entrepreneurs and those intending to start a business understand the concept of cost analysis; and this is what this article is about.
Cost can be put into the following types:
When an entrepreneur pays cash (money) for the needed materials of production, such money is referred to as accounting cost.
Accounting cost may be paid in the following ways:
Note: In most cases, accounting costs are regarded as expenses and will be recorded in the credit side of an account.
Consider this scenario:
A man had a shop and intends to invest on the sale of phones; but he feared the risk involved in the business. As a result, he did not make the investment.
The money (profit) that this man would had earned if he had invested in the phone business is referred to as economic cost.
Similarly, one person may decide to help the needy while another may choose to invest the money instead of helping the needy. If the latter made some profit in his investment and decides to help the needy with the profit, then that’s also an economic cost.
Outlay costs are considered as expenditure in a business. The expenditure may come in the form of rent, wages and salaries.
In a business, outlay costs are generally treated as expenses.
Think of opportunity cost as the income that would have been generated if the next best alternative had been taken. Let’s consider the instance below:
A man with N100 intends to buy a phone and laptop; which he intends to use for maximizing his business.
From the above instance, if the N100 could only purchase one of these products: (Let's assume he went with the phone); then the profit he would have made in his business if he had purchased the laptop is referred to as the opportunity cost.
These are costs that don’t change regardless the volume of output. This cost will always remain constant even if there is a significant increase or decrease in output.
Examples of fixed cost are rent and interest from loans.
This cost is a function of output volume; that is, it will increase if output increases and decrease if output decreases.
Examples of variable cost are cost of raw materials and payment of wages.
A direct cost is a traceable cost since it can be directly linked or traced to its specific purpose.
A direct cost is always easily identifiable.
One will need to know the purpose of a cost before concluding whether it’s direct or indirect.
An example of direct cost is the cost of acquisition of a specific material.
An indirect cost is not easily identifiable or traceable or linked to its specific purpose. For instance, this could be the cost of electricity if you don’t know how your electricity is measured.
As the name imply, they are forgone cost that cannot be recovered. An example is the money spent on advertising or research.
Incremental cost is incurred each time a change had been made. For instance, the cost made on software upgrade or machinery upgrade as a result of an increase in the number of customers is considered to be an incremental cost.
Private cost results from the implementation of a personal objective.
An instance of private cost is when an entrepreneur invests on his personal business which may come in the form of marketing, advertising or purchase of machineries.
The entrepreneur do not bear this cost, rather the society takes on the responsibility.
In the above instance, the entrepreneur does not incur any expense on such projects eventhough he or she lives around this area.
Please click here to follow Len Academy on Google News.
Please like and follow our official facebook page here for great educational write-ups.
You can follow Len Academy on twitter here.Thank you.
Kindly share this article via the links below:
Alfred Ajibola is a Medical Biochemist, a passionate Academician with over 7 years of experience, a Versatile Writer, a Web Developer, a Cisco Certified Network Associate and a Cisco CyberOps Associate.
CONTRIBUTE TO THIS TOPIC | ASK A QUESTION
Amazing facts in Economics
NOTABLE POINTS IN Economics
A Black market is said to take place when there is illegal buying and selling of goods and services.
Black markets usually take place outside the government's rader and without government's knowledge so as to avoid tax or any other government regulations.
Black market presents the avenue for government prohibited goods like hard drugs, war weapons and firearms to be bought by criminals.
A black market can also occur on the web for cyber criminals or those who are involved in computer hacking. To achieve their malicious aim, these individuals will go into the dark web and purchase or rent their respective hacking tools for a fee. Normally, payments are made in crypto currencies.
However, a black market isn't generally considered as bad. Infact, it has its advantages and disadvantages.
Below are some advantages of black market:
Goods and services are sold at a cheaper price.
It helps some people make plenty of money.
The illegal sales of human organs, for example, the sale of human kidneys have aided in saving some lives.
Some people actually depend on black market for their daily bread.
Some of the proceeds from black market may been utilized towards the economic growth of a Nation. For instance, schools and hospitals had been from money made from black market.
The law of supply states that:
The quantity of the supplied services or goods will increase as the price increases and they will decrease as the price decreases provided all other factors remain constant.
These constant factors are very important when stating the supply law. They include:
The price of Input resources
The kind of technology used during production
The number of suppliers
The number of buyers; and so on.
A graph that shows the relationship between the price of a product or service, and its quantity supplied is the supply curve.
Supply curve can be defined as a graphical representation of the direct relationship between the prices of goods and services and the quantity supplied (of such goods and services) within a particular period of time provided all other factors remain constant.
Consider the table below:
Needs / Wants
The above table shows us what a scale of preference would look like.
A scale of preference can be defined as the list of a person's needs or wants written in an order of importance.
You will observe that the person puts his most important needs or wants at the top of the list. Further down the list are his less important needs.
Now, let's imagine that this individual has 170,000 Naira to spend. According to the above scale of preference, the followings can be deduced;
A phone will be considered to be the most important; and it costs 50,000. He buys the phone.
A console game according to this person is next in importance; and it costs 120,000. He buys the console game.
Another question worth asking is:
What happens to his other needs?
This is where the term 'Opportinity Cost comes into play.
Scale of Preference can be defined as the list of a person's needs or wants written in an order of importance. 📜✍️
When you have a limited amount of money and could only buy some of the items on your list (the top items on the list); then the remaining items that you didn't buy will be generally considered as your opportunity cost.
Opportunity cost can be defined as the value of the best alternative that a person could have achieved or bought but couldn't achieve after the best choice had been achieved.
Opportunity cost are of two types. They are: