WorksheetsChapter 1+2 Revision KTEE203.3
Total questions: 10
Worksheet time: 5mins
Which of the following is an example of a factor of production?
a. A want
b. A bank
c. A bond
d. Capital
e. Stock
Which of the following describes scarcity?
Wants are limited
Wants exceed resources
Resources are unlimited
Resources are fully employed
Resources are allocated efficiently
All societies face a trade-off for every decision for which of the following reasons?
A decision entails zero opportunity cost
Resources are scare
Some resources are always unemployed
Resources have no alternative uses
Resources are not allocated efficiently
The circular flow model illustrates the equality of which of the following?
Total expenditure and total income
Savings and consumption
Total income and government spending
Total expenditure and wages
Exports and imports
GDP does not account for which of the following?
The value added by all firms in the economy
The depletion of natural resources
Wages, rent, profit and interest payments
The value of final goods and services produced domestically
Imports from foreign countries
Which of the following transactions will be included in the calculation of country X’s Gross Domestic Product (GDP) in 2022?
The sales of corporate stocks
The exchange of a used automobile for a used boat
The purchase of new construction equipment
Social security checks received by retirees
Carrots grown in a household’s backyard and consumed by the family
As a measure of economic performance, GDP accounts for which of the following?
Used books donated to a local library
Depletion of durable consumer goods
Increased leisure time
Souvenir gifts purchased by tourists domestically
Cash transaction in the underground economy
Which of the following explains why the rate of change of the consumer price index (CPI) tends to overstate the actual inflation rate?
Consumers will require more income to buy goods whose prices have increased
Nominal wages do not always increase by as much as prices do
When real wages increase, consumers can afford higher priced goods
Consumers tend to substitute lower priced goods that may not be represented in the basket of goods
The basket of goods in the base year is frequently updated with new products
In 2022, Sabrina earned an annual salary of $100,000 as an engineer. In 2022, her income rose to $105,000. The inflation rate in 2022 was 2%. How did Sabrina’s nominal income and real income change in 2022 compared to 2021?
Nominal income decreased and real income decreased
Nominal income decreased and real income did not change
Nominal income increased and real income decreased
Nominal income increased and real income did not change
Nominal income increased and real income increased
In 2016 the nominal GDP for Country X was $330 billion and the GDP deflator was 110. The real GDP for 2016 was
$110 billion
$220 billion
$300 billion
$330 billion
$440 billion
