Accounting Multiple Choice Question – 3 October 2017

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

The owner of a restaurant purchased some equipment on credit for business use but returned the equipment to the supplier as it was damaged.  How should the return of the equipment be recorded in the books of the restaurant?

Select ONE MOST LIKELY answer:

Table 06

Why is this recorded as a general journal and not as a purchase returns journal?
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This is multiple choice question is suitable for Accounting KS5 classes.

The answer is 2 – Whilst the equipment was purchased on credit, the original invoice would have been recorded as Dr Equipment (Fixed Assets) Cr Supplier (Balance Sheet) through a general ledger journal. Returning the equipment when it was damaged simply means reversing this journal.

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Economics Multiple Choice Question – 2 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 statements is correct?

Select ONE answer:

  1. The Keynesian long-run AS curve implies that an economy may have a negative output gap in the long run
  2. The Keynesian long-run AS curve is perfectly inelastic at all levels of real national output
  3. The classic long-run AS curve implies that an economy may have spare capacity in the long run
  4. The classical long-run AS curve is perfectly elastic at all levels of real national output
  5. The classical long-run AS curve implies that an economy may have a negative output gap in the long run

Define the term productivity:
……………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………

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

The answer is 1 – Keynesians believe the long run aggregate supply can be upwardly sloping and elastic. They argue that the economy can be below the full employment level, even in the long run. For example, in recession, there is excess saving, leading to a decline in aggregate demand. Keynesians also believe wages and prices can be sticky, and therefore, economies don’t automatically return to full employment equilibrium.

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Economics Multiple Choice Question – 1 October 2017

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

The charts below show forecast UK government revenue and government spending for the financial year 2013/2014.

Diagram 02

Which ONE of the following can be inferred from the charts above? The UK government forecast that for the financial year 2013/2014……….

Select ONE answer:

  1. It would earn five times as much revenue from income tax as from corporation tax
  2. It would spend more on health, than on education and defence added together
  3. More than one-quarter of its revenue would come from VAT
  4. Spending on social protection would comprise more than 30% of its total spending
  5. Other sources of income contribute more than VAT and NI added together.

Using the data in the two charts, calculate the size of the UK government’s forecast budget deficit for the financial year 2013/2014. You are advised to show your workings:
……………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………

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

The answer is 4 – Total forecast spending in 2013 / 2014 is £720 bn. Social protection spending equals £220 bn / £720 bn or 30.5%

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Economics Multiple Choice Question – 30 September 2017

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

The chart below shows the annual percentage change in the UK Consumer Prices Index (CPI) – January 2008 – October 2013.

Chart 01

Which ONE of the following can be inferred from the chart above?

Select ONE answer:

  1. There was deflation in the UK economy between September 2008 and September 2009
  2. The CPI inflation rate was higher in September 2012 than in September 2009
  3. From January 2011 to January 2012, the average price level in the UK fell
  4. From May 2010 to September 2010, the cost of living in the UK fell
  5. From September 2011 to September 2012, the cost of living rose in the UK

Explain TWO limitations of using the CPI to measure the rate of inflation.
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This is multiple choice question is suitable for Economics KS5 classes.

The answer is 2 – The CPI in September 2012 was 2%, whilst in September 2009 it was 1%

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Economics Multiple Choice Question – 29 September 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 likely cause of an increase in the value of an economy’s multiplier?

Select ONE answer:

  1. An increase in the marginal propensity to save
  2. An increase in the basic rate of income tax in the economy
  3. A decrease in the marginal propensity to import
  4. A decrease in investment in the economy
  5. An increase in the propensity to import

In 2011, the Bank of England estimated that the marginal propensity to consume for UK households was on average 0.4. Calculate the value of the multiplier for the UK in 2011. You are advised to show your workings:
……………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………

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

The answer is 3 – The value of the Multiplier depends upon if people spend a high % of any extra income, then there will be a big multiplier effect. However, if any extra money is withdrawn from the circular flow the multiplier effect will be very small. Where k = 1 / 1-mpc =  1 – mpw. Marginal Propensity to Consume (mpc) = a persons willingness to spend money, if a worker saved all his money there wouldn’t be an increase in GDP. Marginal Propensity to Withdraw (mpw) = when money is withdrawn from the circular flow – includes: Marginal Propensity to Tax + Marginal propensity to Import + Marginal Propensity to Save

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Economics Multiple Choice Question – 28 September 2017

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

The table below shows UK annual real GDP values for 2011–2013.

Table 05

Which ONE of the following can be inferred from the table?

Select ONE answer:

  1. Real GDP was falling between 2012 and 2013
  2. The annual UK economic growth rate for 2012 was negative
  3. Nominal GDP was falling between 2012 and 2013
  4. The annual UK economic growth rate for 2012 was positive
  5. Real GDP was lower in 2014 than in 2012

Calculate the annual UK economic growth rate for 2013 from the table above. You are advised to show your workings:
……………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………

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

The answer is 4 – 2012 Real GP was £1,506 Billion and £1,502 Billion in 2011, an increase of 0.3%

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Economics Multiple Choice Question – 27 September 2017

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

According to research, 57% of UK consumers would consider changing insurance providers in the next 12 months.

The underlying assumptions of rational decision making are that:

Select ONE answer:

  1. consumers aim to maximise utility and firms aim to minimise profits
  2. consumers aim to minimise utility and firms aim to maximise profits
  3. consumers aim to maximise utility and firms aim to maximise costs
  4. consumers aim to minimise utility and firms aim to minimise costs
  5. consumers aim to maximise utility and firms aim to maximise profits

Explain one possible reason why 43% of consumers in the UK would not consider changing insurance providers, even though they may be offered lower prices by other insurance providers:
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This is multiple choice question is suitable for Economics KS5 classes.

The answer is 5 – Typically we assume that when making decisions people aim to maximise their own welfare, and firms aim to maximise profits for its owners.

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