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Introduction to Economics

Total questions: 13

Worksheet time: 12mins

Name
Class
Date
1.

In the production possibilities diagram, efficient management of resources is shown by

a)

movement from outside of the curve to a point on the curve

b)

all the points on the curve

c)

change in the slope of the curve

d)

the points inside the curve

2.

The main reason why we study economics is

a)

man has limited resources

b)

man has unlimited wants and needs

c)

man has unlimited wants and needs but resources are limited

d)

man has unpredictable behaviour regarding their way of using the resources

3.

The production possibility curve illustrate the basic principle that

a)

an economy can produce any amount of product due to the possibility of finding new resources

b)

an economy is able to produce outside the production possibility curve even though there is full employment

c)

if an economy decides to produce more of a good now, the economy will have to produce less of that particular good in future

d)

if an economy uses resources efficiently, more of a good can be produced if less of another is produced

4.

Given that resources are scarce

a)

a ‘free lunch’ is possible only for a limited number of people

b)

poor countries must make choices but rich countries with abundant resources do not have to make choices

c)

opportunity costs are experienced whenever choices are made

d)

some choices involve opportunity costs while others choices do

not

5.

Which of the following are the assumptions of production possibility curve (PPC)

a)

full employment of resources.

b)

the advance level of technology

c)

producing two types of goods or services

d)

fixed factors of production

6.

Tangible things is known as (a)   .

7.

“The great increase in labour cost has led to the use of machinery in the production of cake”. The statement above explains a basic economic problem of

a)

What to produce.

b)

How much to produce.

c)

How to produce.

d)

For whom to produce

8.

Due to the financial constraint Fatah Amin need to decide either to buy only a book or a bag. This situation reflecting

a)

financial problem

b)

economic problem

c)

economic concept

d)

economic system

9.

The creative ability of persons to combine and direct resources to produce new products is known as

a)

economizing

b)

entrepreneurship

c)

labour

d)

capital

10.

Which of the following is a microeconomic statement

a)

The Gross Domestic Product (GDP) in Malaysia expanded 3.30 percent in the third quarter of 2012

b)

The unemployment rate in Malaysia has dropped from 3.1% to 2.9%.

c)

The price of personal computers declined last year

d)

The general price level (inflation) increased by 4 percent last year

11.

Which of the following statement is true?

a)

Scarcity means that shortages occur at the existing market price

b)

Due to the scarcity, individuals need to make choices and face opportunity cost

c)

Scarcity exists because resources are unlimited relative to wants

d)

Scarcity can be eliminated through appropriate government intervention

12.

Which of the following represents a point lying outside the production possibility curve?

a)

Unemployment

b)

High price

c)

Increasing cost

d)

Unattainable production in the combination of two goods

13.

Which of the following decisions must be made by all economies?

a)

How much to produce? When to produce? Who will produce? For whom to produce?

b)

How much to produce? How much does it cost? When to produce? For whom to produce?

c)

How much to produce? What to produce? How to produce? For whom to produce?

d)

How much does it cost? Who will Produce? When to produce? For whom to produce