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ECONOMICS Semester 2 Year 10 Exam Prep 2021

Total questions: 115

Worksheet time: 1hrs 20mins

Name
Class
Date
1.
What do you need to produce other goods and services?
a)
consumer goods
b)
capital goods
c)
nondurable goods
d)
Gross Domestic Product (GDP)
2.
How will scarcity of a capital good impact price?
a)
Price would go up
b)
Price would go down
c)
Price would stay the same
d)
You wouldn't sell any
3.
Which of these jobs is involved in production?
a)
Secretary
b)
Factory worker
c)
Truck driver
d)
Zoo keeper
4.
Quantity means
a)
best item
b)
the amount
5.
The thing that you give up (the next best alternative) when you make a decision is known as
a)
Opportunity Cost
b)
Scarcity
c)
Incentive
d)
Choice
6.

Competition and profit motive are important characteristics of a:

a)

command economy

b)

traditional economy

c)

market economy

d)

socialist economy

7.

An economic system in which individuals and businesses make decisions about what to produce.

a)

Market economy

b)

Mixed economy

c)

Communism

d)

Command economy

8.

the government is responsible for ...sector provision

a)

private

b)

public

c)

foreign

d)

financial

9.

The total remuneration that the owners of production factors receive is called national...

a)

production

b)

expenditure

c)

exports

d)

income

10.

An indication of long-term growth in the economy is referred to as the.........

a)

trend line

b)

amplitude

c)

length

d)

trough

11.

Inflation is known as:

a)

a decrease in the price of goods and services.

b)

an increase in the price of good and services.

c)

a decision making strategy

d)

a step in the decision making process.

12.

Which of the following is NOT a characteristic

of natural resources?

a)

They have an unlimited supply.

b)

They are unevenly distributed

c)

They need to be processed before they have a use

d)

They are equally distributed.

13.

Which method is being used to calculate GDP?

a)

Production method

b)

Income method

c)

Expenditure method

d)

Value added method

14.

Those who are willing and able to work at the current wage rate but do not have a paid job

a)

Employed

b)

Involuntary unemployed

c)

Voluntary unemployed

15.

Those who are not willing and able to work at the current wage rate and do not have a job.

a)

Employed

b)

Involuntary unemployed

c)

Voluntary unemployed

16.

Unemployment caused by an imbalance between the skills of workers and the requirements of employers

a)

Employed

b)

Structural unemployment

c)

Frictional unemployment

d)

Voluntary unemployment

e)

Cyclical unemployment

17.

Short-term temporary unemployment caused by people being temporarily between jobs or entering the job market for the first time

a)

Employed

b)

Structural unemployment

c)

Frictional unemployment

d)

Voluntary unemployment

e)

Cyclical unemployment

18.

Unemployment caused by a downturn in economic activity

a)

Employed

b)

Structural unemployment

c)

Frictional unemployment

d)

Voluntary unemployment

e)

Cyclical unemployment

19.

Demand for labour comes from

a)

Producers

b)

Consumers

c)

Government

20.

Supply of labour comes from

a)

Producers

b)

Households

c)

Government

21.

Those who are willing and able to work at the current wage rate and have a paid job

a)

Employed

b)

Structural unemployment

c)

Frictional unemployment

d)

Voluntary unemployment

e)

Cyclical unemployment

22.

An increase in business confidence will cause what change?

a)

Increase in AD

b)

Decrease in AD

c)

Increased AS

d)

Decrease in AS

23.

An increase in income tax will cause what change?

a)

Increase in AD

b)

Decrease in AD

c)

Increased AS

d)

Decrease in AS

24.

An increase in oil prices will cause what change?

a)

Increase in AD

b)

Decrease in AD

c)

Increased AS

d)

Decrease in AS

25.

An increase in worker productivity?

a)

Increase in AD

b)

Decrease in AD

c)

Increased AS

d)

Decrease in AS

26.

An increase in worker productivity?

a)

Increase in AD

b)

Decrease in AD

c)

Increased AS

d)

Decrease in AS

27.

An increase in the min wage causes involuntary unemployment to

a)

Increase

b)

Decrease

c)

Stay the same

28.

Why does an increase in the min wage cause the quantity demanded for labour to fall?

a)

Producers don't require as many workers

b)

Producers are less willing and able to employ as many workers as their costs of production has increases

c)

Less people are willing to work

d)

Less people are able to work

29.

Consumption spending is affected by what factors?

a)

Exchange rate

b)

Consumer confidence

c)

Business confidence

d)

Interest rates

e)

Income tax

30.

Investment spending is affected by what factors?

a)

Exchange rate

b)

Consumer confidence

c)

Business confidence

d)

Interest rates

e)

Income tax

31.

Which of the following is applicable to the economic concept of unemployment

a)

It is a stock concept

b)

The unemployed are those not in work but are actively seeking work

c)

The number of unemployed is measured at a point in time

d)

The labour force excludes those who are considered to be inactive

32.

Identify the correct definition of the unemployment rate

a)

The number of those in work as a percentage of the population of working age people

b)

The number of those unemployed as a percentage of the population of working age people

c)

The number of those unemployed as a percentage of the labour force

d)

The number of those not in work and unemployed as a percentage of the population of working age people

33.

Which of the following is not an example of supply-side unemployment

a)

Frictional

b)

Seasonal

c)

Cyclical

d)

Structural

34.

Which of the following occupations might be subject to seasonal unemployment

a)

Agricultural labourers

b)

Bus drivers

c)

Landscape gardeners

d)

Operations manager in a frozen food factory

35.

Which of the following might solve the problem of regional unemployment?

a)

Making cheap rented accommodation available in areas with low unemployment and many unfilled job vacancies

b)

Making cheap rented accommodation available in areas of high unemployment

c)

Giving grants to firms to set up in areas of low unemployment

d)

Building more vocational training colleges in areas of high employment

36.

Real wage unemployment may be caused by which of the following

a)

Minimum wage legislation

b)

Generous welfare payments

c)

Geographical immobility

d)

Powerful trade unions

37.

Which of the following is most likely to occur during a period of low unemployment?

a)

Investment in new technology by businesses

b)

Government will abolish minimum wage

c)

Rapid wage inflation

d)

Rapid rise in trades union membership

38.

How does a production possibility curve show that scarcity exists?

a)

It shows that a rise in demand for one of the products increases its price.

b)

It shows that as more resources are used to produce a product, its price rises.

c)

It shows that at any point outside the production possibility curve an economy is wasting

resources.

d)

It shows that there is a limit to the quantity of products that can be produced with existing resources and technology.

39.

An economy produces different types of goods using its limited resources. This can be illustrated by a production possibility curve.

What does point X on the production possibility curve show?

a)

All resources are used for the production of consumer goods.

b)

More resources are allocated to producing capital goods than consumer goods.

c)

Resources are allocated to produce a mixture of consumer and capital goods.

d)

Total resources are not being fully utilised for production of these goods.

40.

The diagram shows two production possibility curves for an economy.

What could have caused the change in the economy’s production possibility curve from XX

to YY?

a)

a decrease in the price level

b)

a large number of industrial disputes

c)

a major earthquake

d)

an increase in unemployment

41.

The diagram shows a production possibility curve for an economy that can provide financial services or agricultural products. The economy is at point X.

Bad weather destroys part of the agricultural produce.

At which point will the economy be in the diagram?

a)

A

b)

B

c)

C

d)

D

42.

The diagram shows a production possibility curve for an economy that can produce agricultural products or financial services. It is currently at point Q.

A crop disease decreases agricultural production but the financial services sector increases output as a result of an increase in demand.

To which point is the economy likely to move?

a)

A

b)

B

c)

C

d)

D

43.

The diagram below shows a production possibility boundary for an economy that produces goods and services.

From the diagram it can be concluded that

a)

point X is productively efficient and point Y is allocatively

efficient.

b)

point Y is productively efficient and point X is allocatively

efficient.

c)

points X and Y are allocatively efficient.

d)

points X and Y are productively efficient.

44.

The following diagram shows the production possibility frontier for an economy that produces bread and honey.


If the economy is initially at point W, then the opportunity cost of moving to point X is

a)

6 units of honey.

b)

8 units of honey.

c)

12 units of bread.

d)

23 units of bread.

45.

The diagram below shows two production possibility boundaries for an economy.

The movement of the boundary from EE to FF is likely to have occurred because

a)

consumers have switched their preferences from textiles to computers.

b)

there has been an increase in productivity in the computer industry and a decrease in productivity in the textiles industry.

c)

the production of computers has become more profitable than the production of textiles.

d)

economic resources are being underused in the textiles industry.

46.
What is the fundamental problem of every society?
a)
labor costs
b)
scarcity
c)
economic interdependence
d)
market fluctuation
47.
What is the definition of the economic term Opportunity Cost?
a)
the value of the next best alternative that is given up due to the choice you made 
b)
The price you pay to purchase something 
c)
The benefit you gain by making a decision 
d)
The amount of debt you take on by making a decision 
48.
How do you satisfy your unlimited wants in a world of limited resources?
a)
by making more money
b)
by making choices
c)
by stealing
d)
by setting a budget
49.

If a point lies on the curve this means the company/country/individual is being efficient. If a point lies inside the curve, what does that tell?

a)

They are being over efficient

b)

There is an idle, or unproductive, or use of resources

c)

It is not impossible with the given resources

d)

They are still efficient, just at another point

50.

What does point B represent?

a)

Production at greater than the country's minimum potential

b)

Production is less than the country's minimum potential

c)

Production is greater than the country's maximum potential

d)

Production at the country's maximum potential

51.
What does point Y represent on the PPC?
a)
Efficiency
b)
Unattainable / impossible
c)
Inefficency
d)
Nothing
52.
What is the production possibilities curve?
a)
a graph that shows how efficient an economy can produce a combination of 2 goods
b)
a graph that shows how much money something is
c)
a graph that shows the opportunity a country has to give up in order to lose something else
d)
a visual representation of how land, labor, capital, entrepreneurs are distributed
53.
The opportunity cost of increasing production from 4 to 7 boats is
a)
1 boat
b)
2 boats
c)
2 trucks
d)
3 trucks
54.
The production possibilities curve is an illustration of what?
a)
Opportunity costs and trade-offs
b)
Only opportunity costs
c)
Only trade-offs
d)
none of the above
55.
If a point lies on the curve this means the company is being efficient. If a point lies inside the curve, this tells the company what?
a)
They are being over efficient
b)
They are not efficient
c)
It is impossible
d)
None of the above
56.
The opportunity cost of increasing production from 7 to 9 trucks is
a)
Scarcity
b)
2 boats
c)
2 trucks
d)
3 boats
57.
Based on the table, if the country is currently producing at point B and decides to produce at point C, the opportunity cost for the additional pair of shoes is ____ pizzas.   
a)
26
b)
23
c)
3
d)
2
58.

Economic growth affects the PPC by...

a)

shifting inward

b)

shifting outward

c)

causing no change at all

d)

turning it into a straight line

59.

Suppose that a new machine that speeds up automotive production is introduced into the auto industry. This would cause the PPC to

a)

shift outward

b)

shift inward

c)

do nothing

d)

not enough information is provided

60.

How does a production possibility curve show that scarcity exists?

a)

It shows that a rise in demand for one of the products increases its price.

b)

It shows that as more resources are used to produce a product, its price rises.

c)

It shows that at any point outside the production possibility curve an economy is wasting

resources.

d)

It shows that there is a limit to the quantity of products that can be produced with existing resources and technology.

61.

The diagram shows a production possibility curve for an economy that can produce agricultural products or financial services. It is currently at point Q.

A crop disease decreases agricultural production but the financial services sector increases output as a result of an increase in demand.

To which point is the economy likely to move?

a)

A

b)

B

c)

C

d)

D

62.

The diagram below shows a production possibility boundary for an economy that produces goods and services.

From the diagram it can be concluded that

a)

point X is productively efficient and point Y is allocatively

efficient.

b)

point Y is productively efficient and point X is allocatively

efficient.

c)

points X and Y are allocatively efficient.

d)

points X and Y are productively efficient.

63.

The following diagram shows the production possibility frontier for an economy that produces bread and honey.


If the economy is initially at point W, then the opportunity cost of moving to point X is

a)

6 units of honey.

b)

8 units of honey.

c)

12 units of bread.

d)

23 units of bread.

64.

The missing label in the CFI diagram is...?

a)

Government Sector

b)

Financial Sector

c)

Households

d)

Firms

65.

The missing label in the CFI diagram is...?

a)

Government Sector

b)

Financial Sector

c)

Households

d)

Firms

66.

The missing label in the CFI diagram is...?

a)

Government Sector

b)

Financial Sector

c)

Households

d)

Firms

67.

The missing label in the CFI diagram is...?

a)

Government Sector

b)

Financial Sector

c)

Households

d)

Firms

68.

The missing label in the CFI diagram is...?

a)

Investments

b)

Financial Sector

c)

Savings

d)

Taxes

69.

The missing label in the CFI diagram is...?

a)

Investments

b)

Financial Sector

c)

Savings

d)

Taxes

70.

The missing label in the CFI diagram is...?

a)

Investments

b)

Financial Sector

c)

Savings

d)

Taxes

71.

Explain the arrow

a)

Firms pay for labour in the form of income

b)

Firms provided goods & services

c)

Households buy goods & services

d)

Households provide labour to Firms

72.

Explain the arrow

a)

Firms pay for labour in the form of income

b)

Firms provided goods & services

c)

Households buy goods & services with their income

d)

Households provide labour to Firms

73.

Explain the arrow

a)

Households save part of their income (deposit it banks)

b)

Firms borrow money from the bank to expand (investment)

c)

Households pay tax to the Government

d)

Government spends money on public works

74.

Explain the arrow

a)

Households save part of their income (deposit it banks)

b)

Firms borrow money from the bank to expand (investment)

c)

Households pay tax to the Government

d)

Government spends money on public works such as roads

75.

Which of the following is an injection in the circular flow of income?

a)

An increase in the level of household savings

b)

An increase in the level of investment

c)

A reduction in government expenditure on infrastructure

d)

An increase in taxes (with government expenditure held constant)

76.

Saving is best defined as...

a)

that part of current income which is not spent on consumer goods and services

b)

undertaken by those who make investment decisions

c)

that part of current income which is spent on goods to be used immediately

d)

the difference between income and taxation

77.

Goods purchased for satisfaction of wants are

a)

capital goods

b)

final goods

c)

Consumption goods

d)

Intermediate goods

78.

Factors like land labour capital are provided by

a)

Firms

b)

Households

c)

Consumers

d)

Both B and C

79.

Factor payments are made by

a)

Firms to household

b)

Household to firms

80.

--------- causes expansion of national income.

a)

Leakages

b)

Injections

81.

which of the following is a leakage from circular flow of income

a)

Savings

b)

Taxes

c)

imports

d)

subsidies

82.
When inflation is high the _______________of the dollar decreases
a)
cost value
b)
purchasing power
c)
importance
d)
validity
83.
An index that measures the prices of a market basket of goods that typical consumers purchase.
a)
Consumer Price Index
b)
Federal Reserve
c)
Bank
d)
Deflation
84.
An index that measures the prices of a market basket of goods that typical consumers purchase.
a)
Consumer Price Index
b)
Federal Reserve
c)
Bank
d)
Deflation
85.
Demand-Pull inflation can be describes as too many _________ chasing too few __________
a)
jobs, workers
b)
consumers, producers
c)
dollars, goods
86.
Who is most likely to be hurt by inflation?
a)
someone who borrowed money
b)
a retiree on a fixed income
c)
a business owner
d)
the U.S. government
87.
What 2 types of inflation are there?
a)
demand pull and cost push
b)
demand pull and supply glut
c)
supply glut and demand side
d)
supply inflation and demand inflation
88.
What the definition of deflation? 
a)
decrease in the average price of goods and services
b)
occurs when the price of goods and services rise
c)
increase in prices
d)
I don't know
89.
What causes demand pull inflation?
a)
rise in price due to a decrease in supply
b)
a rise in price level due to an increase in consumption
c)
a rise in price due to an increase in the cost of production
d)
a decrease in price due to a decrease in supply
90.
According to the wage-price spiral, if a company gives a worker a raise in pay, what must they also do?
a)
 Raise the price of their products
b)
go out of business
c)
lower the price of their products
91.
GDP that is adjusted for inflation
a)
real GDP
b)
nominal GDP
c)
price level
d)
net national product
92.
Fiscal policy is
a)
decisions the government makes to fight inflation
b)
actions the the Federal Reservice takes to control money supply
c)
does not help with inflation
93.
If aggregate demand rises faster than producers can supply goods services
a)
demand-pull inflation
b)
cost-push inflation
c)
inflation
94.
If aggregate demand rises faster than producers can supply goods services
a)
demand-pull inflation
b)
cost-push inflation
c)
inflation
95.
Tax that is flat or fixed for individuals
a)
regressive tax
b)
proportional tax
c)
lending tax
d)
income tax
96.
What causes cost push inflation
a)
An increase in demand for goods and services
b)
An increase in supply
c)
A rise in production costs passed on to consumers
d)
A fall in the price of imports
97.

Which is true about the economic system in Australia?

a)

It is difficult for individuals to start their own businesses.

b)

Government rules and laws make starting a business in Australia very risky.

c)

Laws are in place to protect the rights and property of people who want to start their own businesses in Australia.

d)

Few Australians are willing to use their money and time to start businesses because the government is likely to take their business away.

98.

Which is an example of a capital good?

a)

gold

b)

health care

c)

a factory

d)

a diamond

99.

Australia’s early Aborigines made economic decisions based on customs or beliefs . This would be an example of a

a)

market economy.

b)

free enterprise system.

c)

traditional economy.

d)

command economy.

100.

What has helped Australia to have a high GDP?

a)

poor healthcare

b)

modern factories and technology

c)

natural resources that are hard to develop

d)

workers with low-paying jobs

101.

Tariffs and quotas are alike because they both

a)

restrict or limit trade between countries.

b)

completely stop trade between countries.

c)

increase trade between countries.

d)

make trading a lot easier between countries.

102.

Which trade barrier discourages trade by placing a tax on foreign goods?

a)

Embargo

b)

Quota

c)

Subsidy

d)

Tariff

103.

What is an important role of entrepreneurs in the Australian economy?

a)

They sell stocks in the stock market.

b)

They provide new jobs for Australian workers.

c)

They shut down factories that are not making much money.

d)

They take care of sick patients.

104.

Which is an example of investing in capital goods by a company?

a)

providing health care for workers

b)

providing classes for workers to learn new skills

c)

keeping an old machine to see if it will last longer

d)

buying new computers to build products more quickly

105.

Who sets the price for goods in Australia?

a)

Buyers and sellers agree upon price.

b)

The governor-general sets prices for most goods.

c)

Parliament sets a price for all goods in the country.

d)

Prices for goods are set based on customs and beliefs of the Aborigines.

106.

List three sources of income.

4 lines
107.
You should be paid superannuation if:
a)
You earn less than $450 per month
b)
You have a job
c)
You are an Australian resident for tax purposes
d)
You earn more than $450 per month
108.
Superannuation is:
a)
A form of income tax
b)
Money that is paid by your employer in addition to your salary which goes into the superfund of your choice
c)
Money that your employee deducts from your salary
d)
An optional program to put part of your salary away for retirement
109.
TFN stands for:
a)
Tax For Nations
b)
Trade Federation Network
c)
Two Fat Nannas
d)
Tax File Number
110.
ATO stands for:
a)
Australian Tertiary Organisations
b)
Australian Tax Office
c)
Automatic Trade Off
d)
Automatic Teller Office
111.
PAYG Witholding Tax is:
a)
The refund you receive when you lodge your tax return
b)
A tax for medicare
c)
Tax an employer takes out of your salary/wages for the ATO
d)
Only required if you earn more than $30,000 per year
112.
Which of the following is NOT an obligation of an employer
a)
Pay employees at least the minimum wage
b)
Provide employees with a payslip after each pay period
c)
Provide a safe place to work
d)
Provide work uniforms to their employees
113.

The employer must contribute how much Superannuation

a)

9%

b)

8.5%

c)

9.5%

d)

10%

114.

National income does not include_____

a)

Wages and salaries

b)

Rent and Royalty

c)

Student scholarship

d)

Corporate Tax

115.

In a circular flow of income, we have:

a)

Production

b)

Distribution

c)

Disposition

d)

All above

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