Economics Multiple Choice Question – 13 August 2017

Which ONE of the following is an advantage of ‘division of labour’?

Select ONE answer:

  1. There will be an increase in allocative efficiency.
  2. There will be an increase in motivation levels.
  3. Through repetition, a worker becomes more effective at his/her job.
  4. There will be an increase in the number of skills a worker will learn.
  5. There is a decrease in costs

Give 3 examples of the disadvantages of ‘division of labour’?
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This is multiple choice question is suitable for Economics KS5 classes.

The answer is 3 – Practice makes perfect. By concentrating on the repeating the same task again and again, a worker acquires dexterity, skill and speed, and more­over, division of labour avoids waste of time and effort caused by changes from one task to another. Specialisation requires simplification of tasks and facilitates use of labour saving devices. Due to all these the quantity and quality of work increase tremendously.

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Economics Multiple Choice Question – 12 August 2017

Which ONE of the following best explains the difference between a ‘need’ and a ‘want’?

Select ONE answer:

  1. A good is said to be ‘needed’ if it is necessary for survival whereas a good that is ‘wanted’ is not essential but is desired.
  2. A good is said to be ‘needed’ if it is not essential but is desired whereas a good that is ‘wanted’ is necessary for survival.
  3. A good is said to be ‘needed’ if its consumption is based upon rational desires whilst a good that is ‘wanted’ has a consumption based upon irrational desires.
  4. A good is said to be ‘needed’ if it has to be provided by the Government whilst a good is said to be wanted’ if it is provided by the free market.
  5. A good is said to be ‘needed’ if it has to be provided by the free market whilst a good is said to be ‘wanted if it is provided by the Government.

Give 3 examples of a positive economic statement?
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This is multiple choice question is suitable for Economics KS5 classes.

The answer is 1 – In economics, the idea of survival is real, meaning someone would die without their needs being met. This includes things like food, water, and shelter. A want, in economics, is one step up in the order from needs and is simply something that people desire to have, that they may, or may not, be able to obtain.

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Economics Multiple Choice Question – 11 August 2017

Which ONE of these is a normative economic statement?

Select ONE answer:

  1. An increase in the price of cocoa beans will lead to an increase in the price of coffee.
  2. Cars that consume more than the average amount of petrol per mile should have greater taxation.
  3. Subsidies given to a merit good will lead to a reduction in price to the consumer.
  4. The availability of gold as a natural resource is limited.
  5. School children must do 5 hours of homework per week to be successful.

Give 3 examples of a normative economic statement?
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This is multiple choice question is suitable for Economics KS5 classes.

The answer is 2 – In economics and philosophy, a normative statement expresses a value judgment about whether a situation is desirable or undesirable. It looks at the world as it “should” be.

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Business Studies Multiple Choice Question – 10 August 2017

A small UK retailer sells china plates in the UK. Its main competitors are foreign firms. The value of the pound increases compared to the US$.

Which of the following would be the MOST LIKELY results of this change in the £/US$ exchange rate for the UK retailer?

Select ONE answer:

  1. The retailer’s UK sales will increase as the UK retailer’s products will seem cheaper
  2. His competitors plates will seem more expensive
  3. The businesses products will seem more expensive in comparison to the foreign imports
  4. The businesses sales will fall
  5. The business will be more competitive

A strong £ means lots of $ to the £. This means that £1 buys more foreign currency, e.g. £1 today buys $2 compared to £1 a month ago when it bought $1.50. Goods imported into the UK will be cheaper for consumers. An iPad might cost £300 instead of the price a month ago of £400. For businesses exporting to the US, a strong £ means their products will appear more expensive to US consumers, e.g. a Dyson vacuum goes up to $500 compared to $400 the month before. If a strong £ continues, exporters cannot sell products abroad and businesses in the UK cannot compete with cheap imports. What might be the financial impact for these businesses if this continues?
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This is multiple choice question is suitable for Business Studies KS4 classes.

The answer is 3 – The cost of selling china plates at $50 per plate in the UK at an exchange rate of $2 to £1 is £25 for a foreign firm. The cost of selling china plates at $50 per plate in the UK at an exchange rate of $4 to £1 is £12.55 for a foreign firm, a price improvement of £12.5 for a foreign firm selling into the UK.

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Business Studies Multiple Choice Question – 9 August 2017

A small UK baker buys flour from a French supplier. The flour costs 50 Euros per sack. The exchange rate is currently £1= 2.5 Euros. It then changes to £1 = 2 Euros.

Which of the following is MOST LIKELY results of this change in the exchange rate for the baker?

Select ONE answer:

  1. The cost of buying the goods from the French supplier will fall
  2. The cost of buying the goods from the French supplier will rise
  3. The price of the flour increases in France
  4. The business will gain more Euros for the same amount of pounds
  5. There is no change to the price in Europe

In April 2016, £1 could be exchanged for $1.60 when travelling to America. In August 2016, this was down to $1.30. This is sad for tourists, but great for exporters like Rolls-Royce Aerospace, JCB, Bentley Motors – why?
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This is multiple choice question is suitable for Business Studies KS4 classes.

The answer is 2 – The cost of buying flour at €50 per sack at an exchange rate of 2.5 is £20. The cost of buying flour at €50 per sack at an exchange rate of 2 is £25, a cost increase to the UK baker of £5.

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