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WorksheetsPaper 1 OCR Economics
Total questions: 70
Worksheet time: 35mins
A market is
A place where buyers and sellers come together
A place where people can buy goods
A place where buyers and sellers come together and agree a price for the exchange of goods and services
Raw material is related to
Primary sector
Secondary sector
Tertiary sector
Services
The main activities in the secondary sector are:
Industry and education
Industry and construction
Construction and agriculture
Education and training
A teacher belongs to the:
Primary sector
Secondary sector
Tertiary sector
In the secondary sector, workers:
Work in shops
Obtain raw materials
Transform raw materials into products
Which of the following is traded in a factor market?
Stationery
Car parts
Food
Teachers
Which of the following is traded in a product market?
Fishermen
Carrots
Fields
Workers
Which is not an advantage of specialisation and division of labour in the production of goods?
The division of labour requires less training time
Firms produce on a larger scale, i.e. economies of scale
Big production tasks are manageable by spreading the work out
The division of labour can make jobs highly repetitive
Why are most countries better off specialising in the production of particular goods and then trading with other nations to obtain whatever else they need?
Transport costs are lower than they were a century ago
Resources are not evenly distributed among countries
Greater investment of capital goods increases productivity
People have limited resources to satisfy unlimited wants
Kathy, Sue and Christina owns a bakery. Each day all three women spend hours baking cakes, decorating cakes and packaging cakes. Which economic concept would help them become more efficient?
Scarcity
Productivity
Specialisation
Interdependence
Which of these best describes the law of demand?
If prices go up, quantity demanded fall and if prices go down, quantity demanded will go up
If prices go up, quantity demanded will also go up and if prices go down, quantity demanded will also go down
There is no law of demand, each situation is unique and demand and prices cannot be predicted
Prices will go up for certain goods when quantity demanded goes up and vice versa
The quantity demanded of a good or service changes at all price levels best describes the concept of
Change in quantity demanded
Elasticity
Change in demand
Demand curve
Which of the following will cause an increase in demand for snowboards?
More costly production methods
A decrease in the price of lift tickets at resorts in Colorado
A decrease in consumer income
A decrease in the population
A new study has shown that avocados are extremely healthy. The demand for avocados has increased due to a change in
Market size
Price of a substitute good
Price of a complementary good
Tastes and preferences
A recent scandal in which 1 million fake Chanel handbags have been discovered. There is an increase in Louis Vuitton handbags because of a change in:
Price of a complement
Price of a substitute
Tastes and preferences
Income
What factor could have caused the demand to decrease as shown above?
Incomes increased
Expectation that prices will increase
A decrease in the price of a substitute
Increase in market share
The downward slope of a demand curve
Represents the law of demand
Shows that as the price of a good rises, consumers increase the quantity they demand
Indicates how the quantity demanded changes when incomes rise and the good is a normal good
Indicates how demand changes when incomes rise and the good is a normal good
The phrase "a change in demand" most directly implies a
Movement along the curve
Movement along the price curve
Change in quantity demanded of a good
Shift in the demand curve
A change in the demand for apples could result from any of the following except
A change in the number of buyers
Increased preferences for fresh fruit consumption for health reasons
A change in the price of an apple
A change in the price of banana
Consider the market for mobile phones. Which of the following shifts the demand curve leftward?
Studies showing using mobile phones can cause brain cancer
A decrease in the price of mobile phones
A decrease in the quantity demanded of mobile phones
An increase in the services provided by mobile phones, such as text messaging
A decrease in the price of a good will
Increase supply
Decrease supply
Increase quantity supplied
Decrease quantity supplied
What happens to a supply curve when supply goes down?
Moves left
Moves right
Moves up
Moves down
When there is a shortage the price will usually?
Fall
Rise
Remain the same
Become an equilibrium
Which of the following would not shift the supply curve for iPhones?
An increase in the price iPhones
A decrease in the number of sellers of iPhones
An increase in the price of plastic, an input into the production of iPhones
An improvement in the technology used to produce iPhones
New technology advances the rate at which furniture can be assembled. Why does this change the supply?
Changes in numbers of producers
Changes in expectations
Change in cost of production
How does an increase in taxes affect production or supply?
Creates more supply
Creates less supply
Creates variable supply
Does not affect the supply
Which of the following is NOT a determinant of the supply of peanut butter?
The price of peanuts
The wages of peanut butter factory workers
The income of peanut butter consumers
Existing peanut butter making technology
The cost of producing petrol has increased due to rising energy costs. What happens to the market for petrol?
Supply for petrol will decrease
Supply for petrol will increase
Supply petrol will stay the same
A cause, or determinant, of the change seen in the graph above would be:
Taxes on steel make it more expensive to produce
An increase in price led to an increase in quantity supplied
Sellers expect prices to go down in the future
Government regulations increase the cost of production
Why does quantity supplied increase as price rises?
Existing firms produce more AND new firms enter the market
Existing firms produce less AND firm exit the market
The supply curve shifts to the left
Existing firms produce less AND new firms enter the market
What is the name for the point at which supply and demand come together
Price ceiling
Excess demand
Equilibrium
Disequilibrium
A situation in which resources are distributed according to price is called:
Rationing
A black market
A supply shock
A free market
A sudden shortage of a good is called:
Rationing
A black market
A supply shock
A free market
Dividing up goods and services without regard to price is called:
Rationing
A black market
A supply shock
A free market
Business conducted without regard for government controls is called:
Rationing
A black market
A supply shock
A free market
Thousands of people leave a small town due to a factory closing down. Sales at the local grocery store are reduced. What causes this change?
Prices or availability of substitutes
Prices or availability of complementary goods
Change in the weather or season
Change in the number of buyers
New technology advances the rate at which furniture can be assembled. Why does this change the supply?
There is a change in cost of production
The number of producers changes
The expectations of consumers changes
The output rate declines
Mr Coyote goes to the ticket booth to buy tickets for a Liverpool game. Mr Coyote is told that the game is sold out and no tickets are available. Which best explains why there are no basketball tickets available?
The arena forgot to print enough tickets
The supply of tickets was greater than the demand
The arena charged too much money for each ticket
The demand for tickets was greater than the supply
When companies compete in a market economy, what is usually the result?
Consumers are able to buy goods for the best available price
People pay much higher prices for goods
There are frequent shortages of goods on the market
Producers refuse to sell some of their products
If the price of a substitute to good X were to increase, then:
The demand for good X will increase
The market price of good X will increase
The demand for good X will decrease
The demand for good X will not change
Why do producers initially enter a market?
To survive in a market
To increase supply of goods
Because they want to
Because the market needs more producers
What is an oligopoly?
Where one firm dominates a market
Where a small number of firms dominate a market
Where there are many firms and lots of competition
Where producers sell products that are differentiated from one another and hence are not perfect substitutes
How is productivity measured?
Total input/total output
Total output/total output x 100
Total output x total input
Total output/total input
A rise in the standard of living can be brought about by a decrease in production
True
False
How can you increase productivity?
Increase in wages
Workers specialising
Better healthcare
Bob and Susie are sick of the bad service of Costa and hate the high prices of Starbucks. They want to start their own coffee shop - 'Bob and Susie's Coffee!' What are their challenges in entering the market?
Receiving a patent
Sole ownership of necessary resources
Start-up costs are too high
They don't like coffee
The average price of mobile phones suddenly drops by £30. Which of these answers could not be true?
There was a major technological advance
The supply curve for the mobile phone industry would shift to the right
Demand for household phones would increase
Demand for mobile phones would increase
Demand for housing in London suddenly rises. Which of these answers is true?
The demand curve for the housing market would shift to the left
Unemployment would increase
Housing prices would fall
The demand curve for the housing market would shift to the right
A monopoly requires
Products that are high priced
Several close substitutes for the product
A unique products with no close substitutes
That the product cannot be produced by small firms
A monopoly is a market with
Many suppliers
No barriers to entry
Many substitutes
One supplier
Which of the following is likely to 'supply' workers?
Firms
Households
Government
Which of the following is likely to 'demand' workers?
Firms
Households
Government
Which of the following is the correct definition for salary?
The amount of money a worker earns per hour
The amount of money a worker earns after they have paid tax
The amount of money a workers earns yearly
The amount of money a worker earns monthly
Which of the following is a main role of trade unions?
To protect the firms from workers that cannot do their jobs
To argue for high pay at all times
To protect workers from being exploited
To protect firms from being exploited
Which of the following is the correct definition for derived demand?
When the demand for one product depends on the demand for another product
When products are in equal demand
When there are too many consumers demanding a product
When supply and demand are equal
Which of the following is likely to increase the demand for labour?
A slowing economy
A fall in the demand for products
A fall in wages
A fall in a firm's profits
Which of the following is likely to increase the supply of labour?
An increase in wages
A fall in production
An increase in benefit payments
A fall in investment in education and training
Which of the following is not taken off a person's pay?
National Insurance
Tax
Student loan
Food shopping
If a person receives £2,000 in wages and a bonus of £200, what is their gross pay?
£200
£1,800
£2,000
£2,200
What is a person's Net Pay, if they receive £24,000 gross pay, and pay £2,512 in income tax, £1,925 in National Insurance contributions and £1,440 in Pension contributions?
£18,123
£22,075
£24,000
£26,512
Which of the following is likely to 'supply' workers?
Firms
Households
Government
Which of the following is likely to 'demand' workers?
Firms
Households
Government
Which of the following is the correct definition for salary?
The amount of money a worker earns per hour
The amount of money a worker earns after they have paid tax
The amount of money a worker earns yearly
The amount of money a worker earns monthly
Which of the following is a main role of trade unions?
To protect the firms from workers that cannot do their jobs
To argue for high pay at all times
To protect workers from being exploited by firms
Which of the following is the correct definition for derived demand?
When the demand for one product depends on the demand for another product
When products are in equal demand
When there are too many consumers demanding a product
When supply and demand are equal
Which of the following is likely to increase the demand for labour?
A slowing economy
A fall in the demand for products across the UK
A fall in wages
A fall in a firm's profits
Which of the following is likely to increase the supply of labour?
An increase in wages
A fall in population
An increase in benefit payments
A fall in investment in education and training
Which of the following is not taken off a person's pay?
National Insurance
Tax
Student Loan
Food Shop
If a person receives £2,000 in wages and a bonus of £200, what is their gross pay?
£1,800
£2,000
£2,200
£200
What is a person's Net Pay if a person receives £24,00 gross pay and pays £2,512 in income tax, £1,925 in National Insurance contributions, and £1.440 in Pension contributions.
£18,123
£22,075
£24,000
£26,512
