IGCSE AID Economics Quiz On The Basic Economic Problem

What is the fundamental economic problem?

• Equal distribution of resources and wants

• Abundance of resources and limited wants

• Scarcity of resources to satisfy all human wants and needs

• Unlimited resources and finite wants

Which factor of production includes natural resources such as land, lakes, rivers, and forests?

• Labour

• Capital

• Enterprise

• Land

What is the reward for land as a factor of production?

• Wages/salaries

• Interest

• Profit

• Rent

What is the opportunity cost when the government decides to build a hospital instead of a school?

• The cost of building the school

• The education the children could have received

• The cost of building the hospital

• The cost of the land for the hospital

What does a Production Possibility Curve diagram show?

• The total value of all the capital goods needed in production

• The maximum combination of two goods that can be produced by an economy with all the available resources

• The reward for land as a factor of production

• The abundance of resources and limited wants

What does an inward shift in the PPC indicate?

• Economic growth

• Higher production possibility

• The economy is producing at its maximum capacity

• The economy is inefficient

What is the reward for capital as a factor of production?

• Rent

• Profit

• Interest

• Wages/salaries

What is the nature of the economic problem?

• Scarcity of resources to satisfy all human wants and needs

• Unlimited resources and finite wants

• Abundance of resources and limited wants

• Equal distribution of resources and wants

What is the reward for enterprise as a factor of production?

• Profit

• Wages/salaries

• Interest

• Rent

What are economic goods?

• Goods with an opportunity cost

• Goods that are abundant in supply

• Goods that can only be produced with an economic cost

• Goods that are free