Economics Multiple Choice Question – 4 November 2017

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

In a centrally planned economy, which of the following would be most likely to explain the failure of particular industries to achieve their output targets?

Select ONE answer:

  1. The lack of market signals
  2. A change in consumer tastes
  3. An increase in the savings ratio
  4. A deficiency in aggregate effective demand
  5. Miscalculation of the interdependence between industries

Give the advantages and disadvantages of a free market economy?

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

This is multiple choice question is suitable for Economics KS5 classes.

The answer is 5 – You spend much time developing a basic understanding of how a market economy functions but it can help to look at how a centrally planned economy might work (or not) so it is good to know the advantages and disadvantages of such a system. Think about the advantages of a market system. Industries cope with a change in taste via changes in market prices, with changes in the savings ratio by changes in interest rates and with changes in aggregate demand by raising and lowering output and prices (see answers 2, 3 and 4). Now look again at 5. This is a key problem in a planned economy, where output plans are made by the state. In a market economy, governments don’t set output targets and problems of interdependence between industries are dealt with via price adjustments of intermediate outputs. So the answer we arrive at is 5.

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

Economics Multiple Choice Question – 3 November 2017

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

Which one of the following is a distinctive feature of a pure public good?

Select ONE answer:

  1. It is free to consumers
  2. It is produced by the state
  3. It is produced at zero cost
  4. Greater consumption by one person implies less by another
  5. Nobody can be excluded from consuming it

Give 3 examples of a pure public good and explain your reasonings?

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

This is multiple choice question is suitable for Economics KS5 classes.

The answer is 5 – Some MCQs involve knowing the definition of an important economic term. Here it’s the term ‘public good’. 2 is a believable answer in that the state provides goods for members of the public, but you have to know that this is not the meaning of the term. 3 has to be wrong, as the production of any good involves the use of scarce resources and cannot, therefore, be produced at zero cost. 4 is also plausible and wrong, as it is the exact opposite of a public good but It is true of a private good (if you consume an apple then I cannot consume it). Now consider 5 – This is one of the key features of a public good i.e. if street lighting is provided, for example, one cannot prevent people from consuming it.

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

Economics Multiple Choice Question – 2 November 2017

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

The workers in a factory currently earn £240 for a 40 hour week. The management offers them a choice between either a straight 10% wage increase or an increase in the weekly wage to £260 along with a reduction in hours from 40 to 39 hours.

Disregarding the value of leisure time, what is the opportunity cost to each worker of opting for the 39 hour week?

Select ONE answer:

  1. £4.00
  2. £6.00
  3. £20.00
  4. £24.00
  5. £30.00

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

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

This is multiple choice question is suitable for Economics KS5 classes.

The answer is 1 – Opportunity Cost is a key concept in economics and its principle applies to many areas of economic activity. Here it’s applied to wages. As in this question, you will often need to make simple calculations so a calculator might be handy.  Option one is an increase of 10% of 240 pounds = 24 pounds. To get this what does the worker have to give up, that is, the opportunity cost? The pay increase if the extra leisure hour is taken is 260-240 pounds = 20 pounds per week. So the lost income through opting for the extra leisure hour is 4 pounds, the opportunity cost. Checking the other options you can see that both 3 and 4 are plausible but wrong answers because both figured in our calculations. To be good at MCQs you have to think with precision!

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

Business Studies Multiple Choice Question – 1 November 2017

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

A part of a market that contains a group of buyers with similar characteristics is called a market?

Select ONE answer:

  1. Opportunity
  2. Map
  3. Segment
  4. Gap
  5. Resource

Why is understanding whether your total market can be segmented down to specific groups of buyers with similar characteristics important to businesses?
……………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………

This is multiple choice question is suitable for Business Studies KS4 classes.

The answer is 3 – A market segment is a group of people who share one or more common characteristics, lumped together for marketing purposes. Each market segment is unique, and businesses use various criteria to create a target market for their product or service. Businesses approach each segment differently, after fully understanding the needs, lifestyles, demographics and personality of the target consumer within the segment.

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

Business Studies Multiple Choice Question – 31 October 2017

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

Which ONE of the following is NOT an appropriate method of market research for a new small business?

Select ONE answer:

  1. Counting for a day the number of customers that enter the shopping centre they want to locate in.
  2. Employing a specialist market research company to carry out a face-to-face survey of 20,000 people
  3. Using published government statistics about market trends in customer purchases
  4. Asking customers to fill in a short questionnaire on their premises
  5. Conducting an interview with a group of volunteer customers

Why is using published government statistics on market and consumer trends something all businesses should do in their research about business prospects?
……………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………

This is multiple choice question is suitable for Business Studies KS4 classes.

The answer is 2 – The cost of carrying out a face-to-face survey of 20,000 people using a specialist market research company would be prohibitive for a new small business

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

Business Studies Multiple Choice Question – 30 October 2017

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

Jeremy runs Nolans, a car service centre in Leeds In the last 3 years his profit has fallen from £98,000 to £12,000. He is thinking of doing some primary market research to find out possible reasons for this. His aim is to collect some qualitative data from customers.

Which ONE of the following is an example of qualitative data for Jeremy?

Select ONE answer:

  1. The number of car owner within a 5 mile radius of Nolans’s premises.
  2. Information about the views of existing customers
  3. The percentage decline in market share of his business in recent years
  4. The current value of the market share of his business in the City of Leeds.
  5. The number of car service centres in Yorkshire

Why would knowing the number of car owners within a specific radius of a business’s location be important information for a business to have?
……………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………

This is multiple choice question is suitable for Business Studies KS4 classes.

The answer is 2 – The views of existing customers would provide qualitative data (opinions) not quantitative data (facts and numbers) as the other 4 options would do.

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

Business Studies Multiple Choice Question – 29 October 2017

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

Jeremy runs Nolans, a car service centre in Leeds In the last 3 years his profit has fallen from £98,000 to £12,000. He is thinking of doing some primary market research to find out possible reasons for this. His aim is to collect some qualitative data from customers.

Which ONE of the following is NOT an example of primary market research for Jeremy?

Select ONE answer:

  1. Conducting a telephone survey of past customers
  2. Asking existing customers to complete a feedback questionnaire
  3. Setting up a customer suggestion box in the reception area
  4. Searching the internet to find out the prices charged by competitors
  5. Inviting customers to watch their cars being repaired and watching their reaction to the work

Why is surveying past customers an important way to generate qualitative data for a business?
……………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………

This is multiple choice question is suitable for Business Studies KS4 classes.

The answer is 4 – Searching the internet to find out the prices charged by competitors is a forms of secondary research

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