WorksheetsIB SL EXAM MC
Total questions: 25
Worksheet time: 13mins
Name
Class
Date
1.
Economics is the study of*
a)
income allocation in a context of changing wants.
b)
how limited resources can be allocated between competing uses
to satisfy unlimited wants.
c)
how social welfare can be increased in a context of limited
resources.
d)
how unlimited resources can be allocated to satisfy limited
wants.
2.
Which one of the following is a ‘positive’ economic statement?**
a)
The social costs associated with present levels of car usage
are too high.
b)
The imposition of road pricing will discourage car usage.
c)
Road and petrol taxes should be increased to discourage car
usage.
d)
Alternatives to the car, such as public transport, should be
subsidised.
3.
Which one of the following would be an example of market failure?*
a)
The presence of abnormal profits in the short run.
b)
Sudden changes in demand leading to business failures.
c)
The presence of traffic congestion caused by the increased use of motor cars.
d)
Low levels of research and development.
4.
If the government introduces a guaranteed minimum price of $95 for good X, when equilibrium price is $75 the most likely effect will be
a)
a cut in production of good X
b)
the government would increase revenue from good X
c)
an oversupply of good X
d)
none of the above
5.
if the price of tea, a substitute, fell and the wages of coffee workers rose? would result in **
a)
decrease demand for coffee and a decrease in suppy for coffee
b)
decrease demand for coffee and a decrease in suppy for coffee
c)
increase demand for coffee and an increase in suppy for coffee
d)
increase demand for coffee and a decrease in suppy for tea
6.
the changing share of income distribution in an economy is best shown on a *
a)
phillips curve
b)
gini curve
c)
lorenze curve
d)
marshall lerner curve
7.
a supply curve which is drawn perfectly horizontal is *
a)
elastic
b)
perfectly elastic
c)
inelastic
d)
perfectly inelastic
8.
The price elasticity of demand for a good is likely to be low when*
a)
it is habit-forming.
b)
spending on it constitutes a large proportion of total
spending.
c)
it has several close substitutes.
d)
it is considered to be non-essential.
9.
The income elasticity of demand for a good measures the responsiveness of*
a)
income to changes in price.
b)
price to changes in income.
c)
income to changes in demand.
d)
demand to changes in income.
10.
Number of buyers and sellers Few
Entry barriers Some
Nature of product Similar but differentiated
Type of competition Non-price*
Entry barriers Some
Nature of product Similar but differentiated
Type of competition Non-price*
a)
monopolistic.
b)
oligopolisitc.
c)
competitive.
d)
a monopoly
11.
Which one of the following constitutes an increase in injections?
a)
Government expenditure on defence increases but total public expenditure remains unchanged.
b)
More tourists come to visit the country.
c)
Petrol taxes increase in order to curb pollution.
d)
Trading partners abroad enter a period of deep recession.
12.
Which one of the following transactions would be counted in the calculation of GDP?
a)
A gardener plants flowers in his own garden.
b)
A boy swaps his old skates for new ones with a friend.
c)
A man buys 100 shares of stock in XYZ Corporation.
d)
Classic Cars’ manufactures 3,000 automobiles and holds them
as inventory (stock).
13.
shift to the right of the long run aggregate supply curve from LRAS1 to LRAS2 could have been caused by
a)
a reduction in the working week. .
b)
reduction in unemployment led by a boom in exports.
c)
introduction of robots in manufacturing.
d)
an increase in the school leaving age.
14.
Inflation can be defined as*
a)
a situation where prices are very high.
b)
the rate of change in average prices.
c)
a sustained increase in the general price level.
d)
the process of measuring changes in the price level.
15.
an increase in the supply of the Thai baht is most likely to be caused by
a)
the Thai money supply increases.
b)
greater selling of Baht occurs on the foreign exchange
market.
c)
Thailand increases its supply of goods for export.
d)
exchange controls are imposed in Thailand.
16.
if the japanese Yen falls from 140 Y/ A$ to 220 Y /A$ **
a)
Japanese exports to Australia became relatively
dearer
b)
the A$ depreciated in value against the yen.
c)
Australian exports became more price competitive in Japanese markets.
d)
Japanese tourists found the cost of a holiday in Australia more expensive.
17.
Which one of the following would be most likely to lead to an outflow of capital funds from India?**
a)
An anticipated appreciation of the Indian Rupee.
b)
An increase in overseas prices.
c)
An increase in foreign interest rates.
d)
A worsening of India’s terms of trade.
18.
A Japanese national purchases US bonds. For balance of payments purposes, this transaction represents a credit on the **
a)
US official reserve account.
b)
US capital account.
c)
US current account.
d)
Japanese capital account.
19.
Economic development **
a)
is the same as economic growth.
b)
can only occur with economic growth.
c)
must be led by the public sector.
d)
generally results in lower population growth.
20.
A situation where a population or section of the population is able to meet only its bare subsistence essentials to maintain minimum levels of living is known as*
a)
relative poverty.
b)
absolute poverty.
c)
the international poverty line.
d)
insufficient conditions. 4 (optional)
21.
A policy of import substitution increases the likelihood of ***
a)
competitive exports.
b)
greater consumer choice.
c)
monopoly power.
d)
the use of modern technology.
22.
Which one of the following is not a common indicator of economic development?*
a)
Higher levels of labour productivity.
b)
Increased savings ratios.
c)
A higher percentage of total income spent on food.
d)
Increased per capita energy consumption.
23.
A major feature of International Monetary Fund structural adjustment programmes for less developed countries is that they have encouraged**
a)
an over-reliance on government subsidies.
b)
greater use of Keynesian demand management techniques.
c)
the adoption of closed, inward-orientated development
strategies.
d)
resource allocation to be determined to a much greater extent
by market forces.
24.
Many less developed countries have suffered from a long term deterioration in their terms of trade. This has meant that they have **
a)
also suffered from balance of payment problems.
b)
had to export ever greater amounts to purchase given
quantities of imports.
c)
experienced a rise in their export prices relative to their
import prices.
d)
necessarily also suffered from exchange rate
instability.
25.
The International Monetary Fund requires a less developed country to restructure its economy. Which one of the following measures is most likely to be included in the stabilisation package?
a)
Increased use of barriers to trade.
b)
More public sector participation in the economy.
c)
A devaluation of the currency.
d)
Expansionary fiscal policies.
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