Test
Section 1 & Section 2 MCQs
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Preguntas del test (25)
1Which of the following is the MAJOR problem facing all economies?
- AAllocating scarce resources among competing users
- BAchieving an equal distribution of income
- CPreventing the depletion of natural resources
- DAchieving a fair distribution of wealth
2An ‘economy’ is BEST described as a system where
- ASuppliers produce all the goods and services needed by the consumers
- BResources are used by manufacturers to produce goods and maximize profits
- CAll the goods and services used by the citizens of a country are provided by the government
- DResources are used to produce goods and services to meet the needs and wants of society
3Sita and Peter are planning to buy a new house. Which of the following factors should not affect the couple’s decision?
- ATheir joint monthly income
- BThe possibility of a job promotion for Peter
- CThe high cost of renting their current home
- DThe acquisition of a new home by Sita friend
4A student has daily allowance of $20 with which he can purchase chicken and chips or a burger, but NOT both. If he purchases the chicken and chips, the opportunity cost of his decision will be
- AThe burger he gave up
- BThe satisfaction he gets from burgers
- CThe price of the chicken and chips
- DThe satisfaction he gets from the chicken and chips
5A ‘free good’ is BEST described as a good
- AThat is given away by a retailer to promote the sale of another good
- BWhich gives no satisfaction to consumers
- CWhich has an infinite elasticity of supply
- DWhose opportunity cost is zero
6Which of the following is NOT a primary product?
- ABauxite
- BBanana
- CFurniture
- DPetroleum
7Which of the following is an advantage of a market economy?
- AThere is equality of income
- BIt provides an incentive to produce
- CIt reduces pollution and congestion
- DPrice control measures can be effected
8An outward shift in the production possibility curve can be caused by an
- AIncrease in wages
- BIncrease in prices
- CIncrease in imports
- DImprovement in technology
9Which of the following are NOT considered factors of production in the bauxite industry?
- ACompanies that use bauxite
- BLands on which mines are located
- CWorkers employed to work on the mines
- DPersons who invest their capital to carry out mining operations
10Which of the following is NOT an example of a factor of production in a commercial bank?
- AThe building
- BThe bank’s vault
- CShareholders of the bank
- DSpecial savings accounts for students
11Why do consumers have to make choices among the goods and services that they purchase?
- ATheir wants are scarce and their resources are limited
- BTheir resources are insufficient to satisfy all their wants
- CTheir resources increase more rapidly than their wants
- DThey receive most of their goods and services at no cost.
12The Government of Country X decides to switch resources from investment goods to crop production. The opportunity cost of this decision is the
- AProfit earned by farmer
- BRent of the land on which crops are grown
- CReduction in investment goods
- DWages earned by farm workers
13An economy produces two goods, namely sugar and bauxite. What name is given to the curve which shows the maximum amount of bauxite that can be produced for every given amount of sugar?
- AProduction market curve
- BProduction demand curve
- CProduction possibility curve
- DProduction capability curve
14Prices of goods in market economies fluctuate while prices of goods in planned economies tend to be fixed. The MOST likely reason for this difference is that, in the market economy,
- AProfits are lower
- BProducers are never efficient
- CBuyers and sellers determine prices
- DThere are higher unemployment levels
15Item 15 refers to the diagram below which shows the production possibility curve for an economy that produces bananas (X) and oranges (Y).
What is the greatest amount of oranges that can be produced at Point B?
- AOX1
- BOY1
- COX2
- DOY2
16Item 16 refers to the diagram below which shows the production possibility curve for two goods: butter and guns.
At what point in the diagram are resources underemployed?
- AA
- BB
- CC
- DX
17A MAJOR disadvantage of a planned economy is that it
- ACauses inequality in the distribution of income
- BDiscourages individual initiative and enterprise
- CResults in widespread unemployment
- DCauses high rate of inflation
18In which of the following economic systems does the state own ALL the factors of production EXCEPT labour?
- AA mixed economy
- BA market economy
- CA planned economy
- DA subsistence economy
19Sam and Su started a catering business. They organized the factors of production and pooled their financial resources to produce goods and services. Which factors of production should Sam and Su be classified as?
- Aworkers
- Binvestors
- Cmanagers
- Dentrepreneurs
20Which of the following determines the allocation of resources in a mixed economy?
- AConsumers only
- BGovernment only
- CGovernment and producers only
- DGovernment, producers and consumers
21An economy in which ALL of the resources EXCEPT labour are owned by the state can be described as a
- AFree economy
- BMixed economy
- CCapitalist economy
- DCommand economy
22Which of the following features are characteristics of a fully planned economy?
- AAll wages are equal
- BGoods do not have prices
- CThere are no private shareholders
- DThe profit motivate does not exist
23Many developing countries have changed their economies from a command economy to a market based economy in order to increase
- AGovernment control
- BEfficiency
- CSubsidies
- DPrice control
24The Sugar industry in New Island uses a high ratio of labourers to capital as inputs in the production of sugar. Which of the following economic questions is being answered in this production arrangement?
- AHow much to produce
- BFor whom to produce
- CWhat to produce
- DHow to produce
25Joe uses one plot of land and 65 seedlings to do his farming. Each seedling costs $8 and he rents the land for $200. The cost of the land represents his
- Aaverage cost
- Bfixed costs
- Cmarginal cost
- Dvariable costs
Información
- Descripción
- 2016 (Section 1 - Nature of Economics) CSEC Economics Test sobre Section 1 & Section 2 MCQs, creado por Nikolas Reece el 10/06/2016.
- Autor
- Nikolas Reece
- Idioma
- English
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- 487
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