Economics Multiple Choice Question – 18 April 2019

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

Which of the following will cause an economy to move from point A to point B on the production possibility frontier diagram shown below?

Diagram 16

Select ONE answer:

  1. A decrease in imports
  2. A decrease in interest rates
  3. A decrease in consumer spending
  4. A decrease 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 KS5 classes.

The answer is 3

  1. Represents an increase in AD and so would move production point from B to A.
  2. Represents an increase in AD and AS so would move production point from B to A and/or shift out PPF.
  3. Correct: A movement to a point further inside the PPF represents a fall in output.
  4. Shift inwards of the PPF rather than the production point.

 

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

Economics Multiple Choice Question – 17 April 2019

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

According to the Marshall-Lerner condition which of the following countries’ balance of trade will improve following a currency devaluation?

Select ONE answer:

Table 54

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. -0.3 + -0.4 = 0.7, 0.7 <1
  2. -0.3 + -0.7 =1,1=1
  3. -0.7 + -0.1 = 0.8, 0.8 <1
  4. Correct: -0.8 + -0.1 =1.1, 1.1 > 1

 

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

Economics Multiple Choice Question – 16 April 2019

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

Which of the following defines the term recession?

Select ONE answer:

  1. A fall in the long run rate of economic growth
  2. A sustained fall in the level of government spending
  3. The ongoing erosion of the value of real incomes through inflation
  4. Two successive quarters of falling Gross Domestic Product

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. Could fall without becoming negative (also likely to be short run).
  2. Irrelevant
  3. Irrelevant
  4. Correct: This is the accepted definition of a recession.

 

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

Economics Multiple Choice Question – 15 April 2019

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

An appreciation in the value of a country’s currency will lead to ………..?

Select ONE answer:

  1. a rise in government spending
  2. a rise in the rate of inflation
  3. a fall in the rate of unemployment
  4. a fall in the price of imports to that country

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. If the government imports this will fall (ceteris paribus).
  2. May reduce both demand pull and cost push inflationary pressures.
  3. A rise in imports and falling exports will reduce domestic demand.
  4. Correct: When a currency appreciates, imports become cheaper.

 

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

Economics Multiple Choice Question – 14 April 2019

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

Which of the following is a leakage from the circular flow of income?

Select ONE answer:

  1. Exports
  2. Government spending
  3. Investment
  4. Saving

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. Injection.
  2. Injection.
  3. Injection.
  4. Correct: Leakage.

 

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

Economics Multiple Choice Question – 13 April 2019

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

The table below shows the number of labour hours daily that the two countries need to produce one unit of each of the two goods. Other factors of production are used in equal quantities in the two countries.

Table 53

Country X has a comparative advantage in coffee.

What is the missing number from the table?

Select ONE answer:

  1. 6
  2. Any number less than 6
  3. 20
  4. Any number greater than 20

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 2

  1. This would mean neither country having a comparative advantage in either good.
  2. Correct: It requires comparatively little labour to produce a unit of coffee.
  3. The missing figure has to show relatively few units of labour being used to produce a unit of coffee.
  4. The missing figure has to show relatively few units of labour being used to produce a unit of coffee

 

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

Economics Multiple Choice Question – 12 April 2019

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

Which of the following explains why the rate of nominal GDP growth is difficult to measure accurately?

It is difficult to account for changes in:

Select ONE answer:

  1. purchasing power parity
  2. the price level
  3. the size of the population
  4. unrecorded economic activity

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. Confuses this measure with GDP at purchasing power parity, which is a component of the HDI.
  2. Confuses real and nominal GDP.
  3. Confuses nominal GDP with GDP per capita.
  4. Correct: A decrease in unrecorded economic activity would imply nominal output has increased whereas there is simply an increase in the proportion of recorded economic activity.

 

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