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Worksheets1.5.4 - The economy and businesses
Total questions: 13
Worksheet time: 7mins
Which of following best describes the term interest rate?
The price of one currency against another
The cost of borrowing money or reward for saving money
The value of goods and services bought by consumers
The reward for borrowing money or cost of saving money
Which of the following is true in relation to the rate of inflation? Business costs are:
More likely to increase if the rate of inflation rises
More likely to stay the same if the rate of inflation rises
More likely to increase if the rate of inflation falls
More likely to decrease if the rate of inflation rises
Which of the following businesses is most likely to experience a rise in demand as consumer income falls?
Travel agent selling specialist holidays
A producer of high quality chocolate
A department store selling discounted goods
A specialist bakery selling luxury products
Which of the following is the most likely impact of rising unemployment levels on a business selling luxury goods?
Falling sales and rising profit
Rising sales and falling profit
Falling sales and falling profit
Rising sales and rising profit
Which of the following is true of a UK importer of goods from Italy, if the value of the pound becomes weaker against the euro?
Sales increase and profit increases
Sales decrease and profit increases
Sales increase and profit decreases
Sales decrease and profit decreases
A business has borrowed money from a bank in the form of an overdraft. If interest rates rise, the impact on the business will be:
Costs increase and profit decreases
Costs decrease and profit increase
Costs increase and profit increase
Costs decrease and profits decrease
If the government increases the rate of corporation tax, companies are likely to:
Pay more tax and invest more into the business
Pay more tax and invest less into the business
Pay less tax and invest more into the business
Pay less tax and invest less into the business
Which of following best describes the term exchange rate?
Which of following best describes the term exchange rate?
The sales made from importing goods and services
The profit made from exporting goods and services
The price of one currency against another
Which of the following is most likely to be true if the rate of inflation rises sharply? Businesses are:
More likely to be able to manage rising costs
More likely to reduce selling prices
Less likely to be able to manage rising costs
Less likely to raise selling prices
When an economy becomes weaker, interest rates are often reduced meaning consumers are more likely to:
Save more and spend less
Save less and spend more
Save more and spend more
Save less and spend less
Which of the following is true for a UK exporter of goods to Portugal, when the pound becomes stronger against the euro?
Exports will become less expensive
Profits are likely to increase
Exports will become more expensive
Exports sales are likely to increase
Which two of the following are potential advantages to a business which sells luxury products of high levels of employment?
Select two answers:
Business costs increase as wages and salaries rise
Increase in sales levels
Fewer potential employees will be available
Consumer incomes will increase
Staff turnover will increase
Which two of the following are most likely to be true if interest rates fall for a new business?
Select two answers:
Loans become less expensive
Costs may increase
More likely to save money
Less likely to invest
Costs may decrease
