Month: May 2023

In the long run, productive potential in an economy grows at an average rate of 3% per year.

In a particular year actual growth is zero because of a fall in domestic consumption.

What is likely to occur?

Select ONE answer:

1. an increase in the rate of inflation
2. an increase in the trade deficit
3. an increase in unemployment
4. a reduction in the government budget deficit

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

……………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………

This multiple-choice question is suitable for Economics KS4 and KS5 classes.

The answer is 3

1. Not correct
2. Not correct
3. Correct
4. Not correct

This work is licensed under a Creative Commons Attribution 4.0 International License.

What would cause an increase in the transactions demand for money?

Select ONE answer:

1. an increase in the rate of interest
2. an increase in nominal national income
3. a fall in the price of bonds
4. an increase in unemployment

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

……………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………

This multiple-choice question is suitable for Economics KS4 and KS5 classes.

The answer is 2

1. Not correct
2. Correct
3. Not correct
4. Not correct

This work is licensed under a Creative Commons Attribution 4.0 International License.

The accelerator principle refers to a relationship between investment and …..?

Select ONE answer:

1. the level of GDP.
2. changes in GDP.
3. the level of interest rates.
4. changes in interest rates.

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

……………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………

This multiple-choice question is suitable for Economics KS4 and KS5 classes.

The answer is 2

1. Not correct
2. Correct
3. Not correct
4. Not correct

This work is licensed under a Creative Commons Attribution 4.0 International License.

A country’s GDP declines but the welfare of its population rises.

What could explain this?

Select ONE answer:

1. a fall in leisure time
2. a fall in the size of the subsistence sector
3. a rise in positive externalities
4. a rise 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 KS4 and KS5 classes.

The answer is 3

1. Not correct
2. Not correct
3. Correct
4. Not correct

This work is licensed under a Creative Commons Attribution 4.0 International License.

Which of the following will directly result in an increase in India’s Gross National Product?

Select ONE answer:

1. increased wages earned in a British-owned factory in India
2. increased imports of goods and services
3. increased outflows of net property income
4. increased taxes on domestic expenditure

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

……………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………

This multiple-choice question is suitable for Economics KS4 and KS5 classes.

The answer is 1

1. Correct
2. Not correct
3. Not correct
4. Not correct

This work is licensed under a Creative Commons Attribution 4.0 International License.