1. The Market System

Which of the following questions is associated with the basic economic problem?

• When to produce

• Who should produce

• What to produce

• Where should production be located

What is meant by a "command or planned economy"?

• A market that relies least on the public sector for the provision of goods and services

• A market that relies on both the private and the public sectors for the provision of goods and services

• A market that relies entirely on the public sector for the provision of goods and services

• A market that relies on neither the public or the private sectors for the provision of goods and services

Which of the following might be considered a need rather than a want?

• Shelter

• Holiday

• Smartphone

• Pet dog

Which of the following would help consumers and producers to maximise their benefits and profits, respectively?

• Lower prices

• Access to more information

• Improved transport networks

• Better quality products

Which of the following is most likely to be provided by the public sector in the UK?

• Cars

• Roads

• Driving lessons

• Fuel

Which of the following is a reason why consumers may not maximise their benefits?

• Some consumers are very poor

• Opportunity costs may be too high

• Some consumers may develop buying habits that are hard to give up

• Some consumers save a high proportion of their income

Which of the following statements is true about the demand curve?

• When the price falls, the quantity demanded falls

• There is a proportionate relationship between price and the quantity demanded

• It slops up from left to right

• Where there is price change, there is a movement along the demand curve

Which of the following might be an aim of a firm in the private sector?

• Maximise costs

• Maximise profits

• Reduce interest rates

• Minimise efficiency

Which of the following will cause a demand curve to shift to the left?

• A fall in the price of a product

• A rise in income

• A rise in the price

• A fall in income

Cars and petrol are examples of which goods?

• Inferior goods

• Complementary goods

• Substitute goods

• Capital goods