Economics Multiple Choice Question – 18 April 2019

The home of multiple choice questions for all your KS3, KS4 and KS5 Business Studies, Economics and Accounting requirements.

Which of the following will cause an economy to move from point A to point B on the production possibility frontier diagram shown below?

Diagram 16

Select ONE answer:

  1. A decrease in imports
  2. A decrease in interest rates
  3. A decrease in consumer spending
  4. A decrease in the size of the population

Show your workings to arrive at your answer, and explain and justify your reasons:……………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………

This multiple choice question is suitable for Economics KS5 classes.

The answer is 3

  1. Represents an increase in AD and so would move production point from B to A.
  2. Represents an increase in AD and AS so would move production point from B to A and/or shift out PPF.
  3. Correct: A movement to a point further inside the PPF represents a fall in output.
  4. Shift inwards of the PPF rather than the production point.

 

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