WorksheetsEconomics Quiz B Part 1
Total questions: 25
Worksheet time: 15mins
Assume that X bet £20 on the roll of a die. If the die lands with a six facing upwards, X wins £100; if any other number lands face-up, X loses £20. To an economist, X would be operating under
A) uncertain conditions.
B) conditions of risk.
C) a black market.
D) It is not possible to say from the information provided.
Which of the following is most likely to be a variable cost for a firm?
A) The monthly rent on office space that it leased for a year
B) The taxes that are paid on employee wages
C) The franchiser's fee that a restaurant must pay to the national restaurant chain
D) The interest payments made on loans
Which of the following is a fixed cost for a chocolate factory over the course of a month?
A) The cost of electricity (paid quarterly) for running the mixing machines
B) The cost of cocoa
C) Depreciation of machines due simply to their age
D) Overtime pays
You decide to go to college instead of working full-time. Which of the following is NOT considered part of the opportunity cost of your decision?
a) The tuition fees you pay.
b) The lost wages you could have earned while working.
c) The cost of textbooks and course materials.
d) The money you spend on groceries while in college.
When evaluating the true cost of attending university, economists consider all the following EXCEPT:
a) The upfront cost of attending classes
b) The income you could have earned working instead of studying.
c) The social experiences and personal growth gained during college.
d) The time commitment required for studying and attending classes.
As someone's income increases, they tend to buy less of good X. Good X is most likely classified as an:
a) Normal good.
b) Inferior good.
c) Luxury good.
d) Public good.
The demand for product A decreases as there’s a rise in income. This product would be considered a:
a) Normal good.
b) Inferior good.
c) Luxury good.
d) Public good.
The following table shows costs and revenue schedules for a firm. How much total profit will the firm make at the profit-maximising level of output?
£48
£0
£40
£16
The value of the British pound (sterling) would likely depreciate if there is:
An increase in the supply of sterling AND an increase in the demand for sterling
A reduction in the supply of sterling OR a reduction in the demand for sterling
An increase in the supply of sterling AND a reduction in the demand for sterling
A reduction in the supply of sterling OR an increase in the demand for sterling
A country's exports would likely increase due to:
An appreciation of the exchange rate
A fall in overseas income
A depreciation of the exchange rate
None of the above
If a country has a comparative advantage in producing a good that is in high demand globally, what is the most likely outcome for its economy?
The country will experience a decrease in its GDP.
The country will experience an increase in its GDP.
The country will experience a decrease in its population.
The country will experience an increase in its unemployment rate.
What is the primary reason why countries impose tariffs on imports?
To protect domestic industries from foreign competition.
To encourage domestic consumption of foreign goods.
To reduce the trade deficit.
To promote economic growth through increased trade.
If a country experiences a significant increase in the value of its currency, what is the most likely impact on its exports?
Exports will decrease because they become more expensive for foreign buyers.
Exports will increase because they become cheaper for foreign buyers.
There will be no change in exports.
Exports will decrease because domestic industries cannot compete with foreign ones.
In the context of international trade, what is the role of capital controls?
To limit the amount of capital that can be transferred between countries.
To encourage foreign investment in domestic industries.
To prevent the outflow of domestic capital to foreign countries.
To facilitate the movement of labour between countries.
If a country has a trade surplus, what is the most likely impact on its current account balance?
The current account balance will decrease.
The current account balance will increase.
There will be no change in the current account balance.
The current account balance will fluctuate wildly.
What is the main argument for free trade between countries?
It leads to a more balanced distribution of wealth.
It allows countries to specialize in producing goods and services where they have a comparative advantage.
It ensures that all countries have equal access to resources.
It prevents the exploitation of weaker economies by stronger ones.
If a country decides to devalue its currency, what is the most likely impact on its imports?
Imports will decrease because they become more expensive.
Imports will increase because they become cheaper.
There will be no change in imports.
Imports will decrease because domestic industries become more competitive.
In the context of international trade, what is the significance of the concept of 'comparative advantage'?
It determines the types of goods and services a country should produce.
It measures the economic strength of a country relative to others.
A country has the following items in its balance of payments: Its balance on trade in goods and services is a
deficit of £30m
deficit of £40m
deficit of £20m
surplus of £10
deficit of £10m
A depreciation of sterling would be caused by ________ and/or ________.
(a)
Which of the following would cause exports to rise?
A depreciation of the exchange rate
A fall in overseas income
An appreciation of the exchange rate
None of the above
If a country's balance of payments shows a surplus in the current account, this typically indicates that:
the country is importing more than it is exporting.
the country is exporting more than it is importing.
the country is experiencing a recession.
the country is running a budget deficit.
In the context of international trade, what is the difference between a tariff and a quota?
If a country has a negative trade balance, what is the most likely impact on its currency?
The country's currency will appreciate.
The country's currency will depreciate.
The country's currency will remain stable.
The country's currency will fluctuate wildly.
What is the primary purpose of the World Trade Organization (WTO)?
To regulate global trade and ensure fair competition among nations.
To promote economic growth through international trade.
To protect the environment and promote sustainable development.
To provide financial aid to developing countries.
