Category: Economics

Which of the following is not a feature of a ‘good’ tax?

Select ONE answer:

1. certainty
2. convenience
3. durability
4. equity

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. This is a quality of a good tax.
2. This is a quality of a good tax.
3. Correct: This a characteristic of money but not a feature of a good tax.
4. This is the quality of a good tax.

 

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

What do the weights in the Consumer Price Index show?

Select ONE answer:

1. changes in the price of the goods and services purchased
2. changes in the quality of the goods and services purchased
3. the proportion of total expenditure spent on different categories of goods and services
4. the seasonal fluctuations in the price of clothing, food and fuel

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. Prices are multiplied by weights to give a weighted price index.
2. The CPI does not reflect quality changes.
3. Correct: The weights give greater importance to changes in the prices of products that households have devoted a high proportion of their expenditure.
4. The CPI is seasonally adjusted but this is not the function of the weights.

 

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

Christine initially has a disposable income of £500 a week and spends £400.

Christine’s disposable income then rises to £750 a week and her spending to £500.

What is Christine’s marginal propensity to consume?

Select ONE answer:

1. 0.4
2. 0.6
3. 0.67
4. 1.0

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 1

1. Correct: mpc is ∆C/∆Y = 100/250.
2. Incorrect: This is mps. ∆S/∆Y = 150/250.
3. Incorrect: This is apc. C/Y = 500/750.
4. Incorrect: This is the new spending/original income. 500/500.

 

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

Which of the following is an example of current government expenditure?

Select ONE answer:

1. government spending on building new hospitals
2. government spending on improving mobile network coverage in rural areas
3. government spending on increasing the number of lanes on a motorway
4. government spending on teachers’ salaries

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 4

1. This is an example of capital government expenditure.
2. This is an example of capital government expenditure.
3. This is an example of capital government expenditure.
4. Correct: Current government expenditure is spending on items such as raw materials and wages. It is short term spending that has to be renewed each year. In contrast, capital spending is spending on physical assets and is long term.

 

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

Which of the following consists only of injections into the circular flow of income?

Select ONE answer:

1. exports, government spending and investment
2. government spending, investment and savings
3. imports, investment and taxation
4. imports, savings and taxation

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 1

1. Correct: Exports, government spending and taxation are all injections.
2. Although government spending and investment are injections, saving is a leakage.
3. Investment is an injection but savings and taxation are leakages
4. Imports, savings and taxation are all leakages.

 

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