MCQ WITH ANSWERS RELATED TO CONSUMPTION

Which of the following is a primary function of an entrepreneur in an organization?
a) Resource allocation
b) Employee motivation
c) Legal compliance
d) Financial auditing
Answer: a) Resource allocation

Profit is best defined as:
a) Total revenue minus total cost
b) Total revenue divided by total cost
c) Total revenue multiplied by total cost
d) Total cost minus total revenue
Answer: a) Total revenue minus total cost

What does the term “opportunity cost” refer to in profit analysis?
a) The total expenses incurred by the business
b) The highest-valued alternative that must be sacrificed for a decision
c) The revenue generated from a particular product
d) The profit margin of the business
Answer: b) The highest-valued alternative that must be sacrificed for a decision

Which profit theory suggests that profits are the reward for uncertainty-bearing by entrepreneurs?
a) Risk-bearing theory
b) Dynamic equilibrium theory
c) Innovation theory
d) Rent theory
Answer: a) Risk-bearing theory

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