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. 

Choice is an important element in the basic economic problem because
limited resources have alternative uses.
1 of 21
A decision by the government to introduce and expansionary fiscal policy would be less likely to succeed in reducing unemployment if a country had
a high marginal propensity to import.
2 of 21
If the short run aggregate supply curve is perfectly elastic, an increase in aggregate demand brought about by a rise in demand for exports is most likely to cause an increase in
the level of real national output.
3 of 21
The level of capital investment spending by private sector businesses tends to vary ______ with interest rates and ______ with business confidence
negatively, positively
4 of 21
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.
5 of 21
The price of lasagne increase by 20% and as a result the demand for red wine falls by 5%, we can conclude from this information that
the two goods are weak complements.
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The price elasticity of supply of a product will depend on
the availability of factors of production.
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A multiple effect occurs when an initial change in government spending leads to a larger change in the level of
national income.
8 of 21
There is an output gap when
national output is higher or lower than it would have been if the country had grown continuously at its trend rate of growth.
9 of 21
An increase in imports of consumer goods is most likely to have been caused by a
fall in the exchange rate.
10 of 21
Positive externalities exist when
private benefits are less than social benefits.
11 of 21
When an economy operates on its production possibility frontier (PPF), it is
productively efficient.
12 of 21
economics is primarily concerned with the study of
allocating scare resources to satisfy unlimited wants.
13 of 21
In a market based economy the scarcity of factors of production means that
consumers must inevitably consider the opportunity cost of their choices.
14 of 21
In economics it is generally assumed that the main objective of frma ia to
maximise total profits
15 of 21
What are the two only free goods?
Sunlight and air.
16 of 21
What are goods provided by the government for people who are deemed to need them called?
Merit goods.
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A Demerit good is:
seen as undesirable, over produced and over priced.
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What are the factors of production?
Capital, Labour, Land, Entrepreneur.
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What are the pure public goods?
Street lights, Flood defences and Lighthouses.
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Non- excludability is where:
no one can be excluded from the benefiting of a good.
21 of 21

Other cards in this set

Card 2

Front

A decision by the government to introduce and expansionary fiscal policy would be less likely to succeed in reducing unemployment if a country had

Back

a high marginal propensity to import.

Card 3

Front

If the short run aggregate supply curve is perfectly elastic, an increase in aggregate demand brought about by a rise in demand for exports is most likely to cause an increase in

Back

Preview of the front of card 3

Card 4

Front

The level of capital investment spending by private sector businesses tends to vary ______ with interest rates and ______ with business confidence

Back

Preview of the front of card 4

Card 5

Front

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

Back

Preview of the front of card 5
View more cards

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