A level Theory of Cost Quiz 1

Here in this A level quiz, we will be looking at the theory of cost. The theory of cost has to deal with some exciting theories such as opportunity cost, average cost, marginal physical product, real cost, etc. All of these will be appreciably covered in this quiz.

Cost could be defined as the monetary value of goods and services normally purchased by consumers and producers. In an economic sense, cost is a measure of the alternative opportunities forgone in the choice of a good or service. This cost is referred to as opportunity cost. Total cost has to do with the total expense incurred in reaching a certain output level, and a portion of this total cost is known as fixed cost. An example of a fixed cost could be the cost of purchasing heavy machinery or building. Another type of cost is variable cost, which includes costs of labour, raw materials and so on.

Are you very good at economics? Try this quiz and see your level of understanding of this topic in economics. Good luck as you practice.