Economics Grade 9 (IGCSE) - Trial Quiz

Which economic question is least likely to arise as a result of scarcity?

• For whom will we produce?

• How will we produce?

• What will we produce?

• When will we produce?

Which factor has the correct factor reward identified?

• capital -

  profit

• enterprise -

  wages

• labour -

  interest

• land -

  rent

Sanjay is a risk taker and sets up a restaurant in Chennai. Sanjay works for the business as a chef. He leases the restaurant building from Raghav and employs him to serve the customers.

 

Which income is earned by Sanjay and Raghav?

• interest and profit (Sanjay) -

  wages only (Raghav)

• interest and wages (Sanjay)

  profits and rent (Raghav)

• profits and wages (sanjay)

  rent and wages (Raghav)

• profits only(sanjay)

  interest and wages (Raghav)

What is opportunity cost?

• the allocation of resources in an economy

• the cost to the individual when they consume a good

• the lack of goods and services available to satisfy unlimited wants

• the next best alternative forgone when making an economic decision

A student has nothing to do on a Friday evening. She withdraws $5 from the $100 she has in a savings account and buys a present to take to a party, to which admission is free.

 

What does this involve?

• an opportunity cost equal to $95

• an opportunity cost equal to other goods she could have bought for $5

• no opportunity cost, as entrance to the party is free

• no opportunity cost, as she had no better way of using the time

A government reduces social security spending by $10 bn in order to increase defence spending by $10 bn.

What is this an example of?

• expansionary fiscal policy

• market forces

• Price stability

• Relocation of resources

The diagram shows a production possibility curve (PPC) for an economy that produces two goods, X and Y.

 

Which point shows the greatest opportunity cost of producing one more unit of good X?

• A

• B

• C

• D

What would cause a shift in a country’s production possibility curve?

• a fall in unemployment

• a recovery from recession

• a rise in prices

• the destruction of factories in a war

The table shows the maximum production possibilities for goods and services for a country.

The country originally produced only goods but now produces 20 million units of services. The country continues to operate at maximum production possibility.

 What is the opportunity cost for this country?

• 20 million units of goods

• 100 million units of goods

• 20 million units of services

• Zero

A period of bad weather leads to a failure of the rice crop. What is the effect on the market for rice?

• a shortage of rice and a fall in its price

• a shortage of rice and a rise in its price

• a surplus of rice and a fall in its price

• a surplus of rice and a rise in its price