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

  • negatively, negatively
  • positively, negatively
  • negatively, positively
  • positively, positively
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Other questions in this quiz

2. An increase in imports of consumer goods is most likely to have been caused by a

  • rise in household disposable income.
  • rise in direct taxation.
  • fall in the exchange rate.
  • rise in household saving.

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

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

4. The price elasticity of supply of a product will depend on

  • the availability of factors of production.
  • the incomes of consumers.
  • whether the product is a luxury or a necessity.
  • the extent to which the product is advertised.

5. 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.
  • the economy is continuously producing more capital goods than consumer goods over a period of time.
  • unemployment occurs because the rate of economic growth increase above its trend rate of growth.
  • productivity is continuously higher in one country than in another.

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