WorksheetsBasic Economic Concepts
Total questions: 41
Worksheet time: 21mins
Which of the following is considered a "need"?
Video games
Food
Designer clothes
Smartphone
A want is best described as:
Something essential for survival
Something desired but not essential
A basic requirement for life
An unavoidable expense
Why do people need to make choices in economics?
Unlimited resources
Unlimited needs
Limited resources and unlimited wants
Limited needs and limited wants
Scarcity means:
Not enough money to buy things
Limited resources to meet unlimited wants
Unlimited resources to meet limited needs
Availability of all goods
In economic terms, choice refers to:
Choosing between available goods and services
Deciding how to spend money
Selecting the best investment
Opting for the cheapest option
Opportunity cost is defined as:
The total money spent on a product
The next best alternative foregone
The profit from selling goods
The least important option chosen
If a student chooses to study instead of going to a concert, what is the opportunity cost?
The cost of the concert ticket
The time spent studying
The enjoyment of the concert
The grade earned
A business that decides to produce only one product faces opportunity cost because:
It loses the chance to produce other products
It has to spend more on marketing
It can sell at higher prices
It increases resources
Which of the following is an example of an opportunity cost?
Unlimited availability of goods
The process of producing goods
The process of saving money
Choosing between available goods and services
Choosing between two ice cream flavours is an example of:
Choosing between two ice cream flavours
Buying a shirt on sale
Time spent working instead of relaxing
Earning money from a job
Opportunity cost is important because it:
Increases resources
Shows the consequences of a choice
Decreases scarcity
Eliminates wants
The circular flow model shows the relationship between:
Households and government
Businesses and other businesses
Households and businesses
Government and businesses only
In the circular flow model, households provide businesses with:
Goods and services
Land, labour, and capital
Wages and salaries
Taxes
What do businesses supply to households in the circular flow model?
Money
Resources
Goods and services
Jobs
Which of the following is NOT part of the circular flow model?
Households
Businesses
Government regulations
Financial markets
In the circular flow model, the payment households receive for their labour is called:
Profit
Rent
Wage
Interest
The law of demand states that as price increases:
Quantity demanded decreases
Quantity demanded increases
Quantity supplied decreases
Demand remains the same
According to the law of supply, if the price of a good rises, the quantity supplied:
Decreases
Increases
Remains the same
Fluctuates
Which graph line typically slopes downward, illustrating the law of demand?
Demand curve
Supply curve
Equilibrium line
Revenue curve
If a product's price drops, what is likely to happen to the quantity supplied?
It decreases
It increases
It stays the same
It disappears entirely
Which of the following does NOT shift the demand curve?
Changes in consumer income
Changes in the price of the good
Changes in consumer tastes
Changes in the price of a related good
Market equilibrium is reached when:
Demand is greater than supply
Supply is greater than demand
Demand equals supply
Supply equals zero
At equilibrium, the price of a good is:
Too high
Constantly changing
Stable, where supply and demand intersect
Always low
What happens if demand suddenly increases, but supply stays the same?
Price rises
Price falls
Supply increases
Demand decreases
When there is a surplus, what is likely to happen to prices?
Prices increase
Prices decrease
Prices stay the same
Prices become unpredictable
If the government sets a minimum price above equilibrium, it may create:
A shortage
A surplus
Lower demand
Equal demand and supply
Which of the following is a factor of production?
Goods
Land
Services
Income
Labour as a factor of production refers to:
Machinery used in production
Human effort in production
Natural resources used
Profits generated
The reward for land as a factor of production is:
Profit
Wage
Rent
Interest
Which of the following best describes capital in economics?
Money used for shopping
Resources like factories and machines used for production
Human labour
Natural resources
Entrepreneurship in production is rewarded by:
Salary
Profit
Rent
Interest
Which of the following is the reward for capital?
Rent
Wage
Profit
Interest
What is the primary factor that causes a shift in the supply curve?
Changes in consumer preferences
Changes in production costs
Changes in consumer income
Changes in the price of a substitute good
Which of the following best describes a market economy?
An economy where the government makes all economic decisions
An economy where supply and demand determine prices
An economy with no private ownership
An economy with fixed prices for all goods
What is the effect of a price ceiling set below the equilibrium price?
It leads to a surplus
It leads to a shortage
It has no effect on the market
It increases the equilibrium price
How do personal values influence financial goals?
They determine the amount of money one can earn
They guide the prioritization of financial objectives
They have no impact on financial planning
They only affect short-term financial decisions
What is the relationship between scarcity and choice in financial planning?
Scarcity leads to unlimited choices
Scarcity forces individuals to make choices
Choice eliminates scarcity
Scarcity and choice are unrelated
Which of the following best describes the impact of scarcity on financial goals?
Scarcity ensures all goals are easily achieved
Scarcity requires prioritizing certain goals over others
Scarcity has no effect on financial goals
Scarcity increases the resources available for goals
What happens to the demand for a product if consumer income increases?
Demand decreases
Demand increases
Demand remains unchanged
Demand becomes unpredictable
Which of the following is a characteristic of a command economy?
Prices are determined by supply and demand
Government controls all major aspects of the economy
Private ownership is encouraged
Market forces dictate production
What is the primary role of financial markets in an economy?
To regulate prices
To facilitate the exchange of goods and services
To allocate resources efficiently
To provide employment opportunities
