Economics GCSE Multiple Choice Feb 2022

What does an economist mean by capital?

• Man made goods that do not directly satisfy human wants

• Money used to set up a new business and expand existing businesses

• Natural resources that will not be replaced

• To earn profits by combining resources to produce goods

A student leaves school and decides to spend the next 2 years at college to improve her qualifications.

What is the opportunity cost of this decision?

• The cost of the course fees at the college

• The increase in job opportunities she will have as a result of her extra qualification

• The lost production due to her not being in work

• The money she would have earned if she had been in work for 2 years

What is found in a mixed economy but not a free market economy?

• banks

• division of labour

• price controls

• profit motive

A large shop selling clothes opened in a town. As a result many more customers came to the area. They also visited restaurants near the shop. The restaurants reported a 10% increase in sales.

What economic concept does the above statement best illustrate?

• external benefit

• inelastic demand

• market failure

• perfect competition

A shop sells chocolate birthday cakes. When the price was $15 it sold 40 cakes. It reduced the price to $10 and sold 60 cakes.

What is the PED of the birthday cakes?

• 0.66

• 1.5

• 0.5

• 2

In 2010, a major oil leak from an oil rig affected many people living around the Gulf of Mexico.

What type of market failure did they experience?

• Monopoly exploitation

• Negative externality

• Price discrimination

• Rising tax burden

What is likely to cause wages in an occupation to be high?

• a low level of responsibility

• high unemployment

• pleasant working conditions

• the need for special skills

A trade union negotiates a basic weekly wage for its members with all employers in an industry. In addition to the basic wage, one company also operates a production bonus at factory level.

What is the aim of this company?

• to give equal wages to all workers

• to increase the efficiency of the workers

• to introduce a minimum wage

• to reduce its total wage bill

What might cause a rise in the proportion of income that a person saves?

• a fall in interest rates

• a fall in population

• a fall in real incomes

• a fall in the income tax rate

The are 2 workers, a doctor and a window cleaner.

Doctor income is $50000, with $10000 deductions.

Window cleaner income is $20000, with $8000 total deductions.

Both workers save 10% of their disposable income, how much do they save?

• Doctor $12000

  Window cleaner $40000

• Doctor $1200

  Window cleaner $4000

• Doctor $40000

  Window cleaner $12000

• Doctor $4000

  Window cleaner $1200