Economics section A

This is based on all choice questions from unit 1 of microeconomics. Most of these questions are from many different past papers. 

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1. Good X is an inferior good. A rise in consumers' income is likely to lead to:

  • A fall in demand and an fall in market price and quantity sold.
  • A fall in demand and an increase in market price and quantity sold.
  • An expansion of market supply following an increase in demand.
  • A rise in demand and an increase in market price and quantity sold.
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2. What are goods provided by the government for people who are deemed to need them called?

  • Positive externalities.
  • Negative externalities.
  • Merit goods.
  • Demerit goods.

3. In a market based economy the scarcity of factors of production means that

  • consumers must inevitably consider the opportunity cost of their choices.
  • the economy cannot produce on its production possibility frontier.
  • inflation is inevitable.
  • the economy cannot achieve economics growth every year.

4. Which one of the following is a measure of productivity?

  • the total amount of output produced each month.
  • output divided by employment.
  • the annual percentage increase in production.
  • the quantity of capital equipment used divided by its price.

5. What are the two only free goods?

  • Sunlight and air.
  • Fuel and water.
  • Chocolate and Phones.
  • Paper and wood.

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