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WorksheetsEconomics Quiz
Total questions: 50
Worksheet time: 25mins
Economics is primarily concerned with the study of:
Scarcity and choice
Wealth and poverty
Production only
Demand and supply only
The branch of economics that deals with the individual units of the economy is:
Microeconomics
Macroeconomics
International economics
Financial economics
An example of a free good is:
Water in a river
Packaged water
Electricity
Petrol
In a market economy, prices are determined by:
Government agencies
The interaction of demand and supply
Business owners
Trade unions
The factors of production include:
Land, labor, capital, and enterprise
Rent, wages, profit, and interest
Goods, services, demand, and supply
Money, machines, resources, and land
The opportunity cost of choosing one good over another is the:
Monetary cost of the chosen good
Next best alternative foregone
Total cost of all alternatives
Cost of production of the good
When quantity demanded equals quantity supplied, it is called:
Disequilibrium
Market equilibrium
Surplus
Shortage
The law of demand states that, other things being equal:
Demand rises as prices fall
Demand falls as prices rise
Demand is unaffected by price
Demand remains constant
A movement along the demand curve is caused by changes in:
Price
Income
Consumer taste
Number of sellers
In economic terms, inflation is best described as:
An increase in prices over time
A decrease in prices over time
A rise in employment
A decline in gross domestic product
The main function of money is to:
Increase the supply of goods
Serve as a medium of exchange
Stabilize prices
Generate profit
A perfectly elastic demand curve is:
Horizontal
Vertical
Upward sloping
Downward sloping
If two goods are complements, an increase in the price of one will:
Increase the demand for the other
Decrease the demand for the other
Not affect the demand for the other
Increase the supply of the other
Gross Domestic Product (GDP) is a measure of:
National income
Total exports
Total imports
Net income from abroad
An advantage of a mixed economy is that it:
Allows only government ownership
Combines private and public sector control
Excludes private enterprises
Provides no regulation
The demand for labor is a:
Primary demand
Secondary demand
Derived demand
Inelastic demand
In the short run, at least one factor of production is:
Variable
Fixed
Limited
Reduced
A market structure with many firms selling identical products is called:
Monopoly
Perfect competition
Oligopoly
Monopolistic competition
The central bank controls the economy through:
Fiscal policy
Monetary policy
Trade policy
Employment policy
Which of the following is a direct tax?
Value-added tax
Income tax
Sales tax
Import duty
The production possibility curve (PPC) shows:
The maximum combination of goods a country can produce
The level of imports a country can afford
The types of goods to export
Price levels in a market
Price elasticity of demand measures the:
Responsiveness of demand to changes in income
Responsiveness of demand to changes in price
Quantity of goods demanded
Level of supply of goods
When supply exceeds demand, there is:
Surplus
Shortage
Equilibrium
Inflation
Which of these is a feature of a centrally planned economy?
Private ownership of resources
Profit maximization
Government ownership of resources
Price determined by market forces
The term “invisible hand” in economics refers to:
Government intervention
Regulation by trade unions
Market forces that allocate resources
International trade policies
The type of cost that does not vary with the level of production is known as:
Variable cost
Average cost
Fixed cost
Marginal cost
A monopoly exists when there is:
Only one buyer
Only one seller
A large number of sellers
Competition among firms
Which of the following is an example of an indirect tax?
Personal income tax
Corporation tax
Value-added tax (VAT)
Capital gains tax
In the circular flow of income, households supply:
Goods and services
Factors of production
Tax revenues
Public goods
Devaluation of a currency will make exports:
More expensive
Cheaper
Unchanged
Less competitive
When two goods are substitutes, an increase in the price of one will:
Increase the demand for the other
Decrease the demand for the other
Leave the demand for the other unchanged
Increase the supply of the other
A public good is one that is:
Rivalrous and excludable
Non-rivalrous and non-excludable
Produced by private firms
Only provided by the government
A tax imposed on goods imported into a country is called a:
Sales tax
Income tax
Tariff
Value-added tax
The reward for capital as a factor of production is:
Rent
Wages
Profit
Interest
The elasticity of supply measures the responsiveness of:
Price to demand
Demand to price
Supply to price
Quantity demanded to supply
A system where production and distribution decisions are made centrally by the government is known as:
Mixed economy
Capitalist economy
Command economy
Market economy
A condition where no one can be made better off without making someone else worse off is called:
Opportunity cost
Efficiency
Equity
Pareto optimality
An outward shift in the production possibility curve indicates:
Economic growth
Economic recession
Increased unemployment
Decreased production capacity
Which of the following is NOT a function of money?
Medium of exchange
Store of value
Measure of value
Means of consumption
If the marginal cost of production is less than the average cost, the average cost will:
Increase
Decrease
Remain constant
Double
In perfect competition, firms are said to be:
Price makers
Price takers
Monopolistic
Oligopolistic
The proportion of income spent on a good is a factor influencing:
Price elasticity of demand
Price elasticity of supply
Market equilibrium
Economic profit
Which of the following is a characteristic of developing countries?
High levels of industrialization
High per capita income
Low literacy rates
Surplus trade balance
A budget deficit occurs when:
Government revenue exceeds spending
Government spending exceeds revenue
Exports exceed imports
Imports exceed exports
Inflation that occurs when aggregate demand exceeds aggregate supply is called:
Cost-push inflation
Demand-pull inflation
Hyperinflation
Stagflation
National income can be calculated using all of the following methods EXCEPT:
Production method
Expenditure method
Income method
Import method
A decrease in the general level of prices in an economy is called:
Deflation
Inflation
Reflation
Disinflation
A measure used to compare the standard of living between countries is:
GDP
Per capita income
Exchange rate
Consumer price index
The primary function of commercial banks is to:
Issue currency
Control inflation
Provide loans and accept deposits
Regulate foreign trade
When a country’s imports exceed its exports, it experiences a:
Budget surplus
Trade surplus
Budget deficit
Trade deficit
