Yr 1 W 2 Assessment quiz

What does a movement along the Production Possibility Frontier (PPF) represent?

• A change in the opportunity cost

• A change in the allocation of resources

• An increase in the productive capacity of the economy

• A technological advancement

Which of the following is a characteristic of money?

• It is perishable

• It is a medium of exchange

• It is a form of barter

• It is a liability

What is the opportunity cost of choosing to spend an evening studying instead of going out with friends?

• The money saved by not going out

• The enjoyment and social interaction missed

• The cost of the study materials

• The time spent studying

Which of the following best describes Pareto efficiency?

• No one can be made better off without making someone else worse off

• Resources are allocated to maximise total surplus

• All resources are used in production

• The economy is operating on the PPF

What is allocative efficiency?

• Producing goods at the lowest possible cost

• Distributing resources to maximise consumer satisfaction

• Using all available resources in production

• Achieving the maximum output from given inputs

Which of the following is an example of a positive incentive?

• A fine for littering

• A tax on sugary drinks

• A bonus for meeting sales targets

• A penalty for late payment

What does a shift outward of the PPF indicate?

• A decrease in the economy's resources

• An improvement in technology

• A reduction in opportunity cost

• A decrease in consumer demand

Which of the following is NOT a function of money?

• Store of value

• Unit of account

• Medium of exchange

• Measure of opportunity cost

What is productive efficiency?

• Producing goods that consumers value most

• Producing goods at the lowest possible cost

• Allocating resources to maximise total welfare

• Achieving a balance between supply and demand

Which of the following scenarios best illustrates the concept of opportunity cost?

• Choosing to buy a new phone instead of a new laptop

• Saving money in a bank account

• Investing in a business venture

• Receiving a salary increase