OCR Economics Part 1

Which of the following refers to the role of the consumer

• Acts as the end-user of a good or service

• Acts to protect buyers of goods and services

• Can decide what goods and services to supply

• Can introduce regulations about goods and services

Prices change to show where resources are needed. This process is called

• efficiency

• rationing

• signalling

• transmission of preferences

Which of the following is the best explanation of the difference between price and worth?

• Price is determined by the interaction of demand and supply whereas worth is how consumers indicate their choices

• Price is how resources are efficiently distributed whereas worth is the opportunity cost of using the resources

• Price is the cost of a product whereas worth is how that price is determined by the market

• Price is the sum of money needed to pay for a product whereas worth is how much someone values the product

Which of the following is an example of a market in operation?

• A country experiences inflation

• Consumers buy services from producers

• The government taxes producers

• Workers pay taxes out of their wages

Which of these workers produces output in the primary sector?

• A farmer - Like Oliver

• A nurse

• A waiter in a restaurant

• A worker on a building site

Goods A and B are substitutes. The supply of good A increases. What will happen in the market for good B?

• Demand will decrease

• Demand will increase

• Nothing

• The supply curve will shift to the right

All production decisions have an opportunity cost. This means that when something is produced

• an identical alternative is given up

• the least valuable alternative is given up

• the next best alternative is given up

• there is no other alternative

For an exchange to take place which of the following is essential?

• At least one buyer and one seller

• Government permission to trade

• Specialisation

• The payment of money

You are the economist for a timber merchant and have been asked to advise your team leader about factors of production. - Which of these is an example of capital?

• A computer monitor

• The business owner

• The company’s shares

• The trees owned by the company

What is most likely to cause a decrease in the price of carrots?

• A decrease in the demand for substitutes of carrots

• An increase in the demand for complements of carrots

• An increase in the number of farm workers

• An increase in the popularity of carrots