[ { "notes": "", "input": "", "output": "Question: \nWhich statement about factors of production is correct?\nA Capital is the money people keep in the bank.\nB Enterprise is found more in service industries than in manufacturing industries.\nC Labour includes only those who work using their hands.\nD Land includes resources found in or under the sea.\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nChina earns enough income to purchase large quantities of natural resources from developing\ncountries.\n\nWhich statement explains this situation?\nA China does not experience the economic problem of scarcity.\nB Supplies of natural resources in China are limited relative to demand.\nC There are unlimited supplies of natural resources in developing countries.\nD There is an excess stock of land in China.\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nAlthough some economists believe that resources should be allocated through market forces,\nmarkets often fail.\n\nWhat might be an example of market failure?\nA access to subsidised health care\nB monopoly pricing of electricity supplies\nC prohibiting cigarette smoking in public places\nD regulation of interest rates charged by banks\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nA group of shops sells all its products at the same price of $1. It is still able to make a profit,\nalthough in other shops the products are sold at a higher price.\n\nWhich statement about this group of shops must be correct?\nA Consumers recognise that the group\u2019s products are better value.\nB Costs will be lower than in the other shops.\nC Revenue will be less than in the other shops.\nD The group does not advertise nor use any form of marketing.\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nIn 2011, the Bank of England released into circulation a new design for the \u00a350 note to replace\nthe old design \u00a350 note.\n\nWhat might have been the reason for issuing these notes?\nA to ease the use of the barter system\nB to enable a means of exchange\nC to lower the external value of the \u00a3 sterling\nD to reduce inflationary pressures in the economy\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nA security company wishes to recruit an experienced person for a senior position to answer\ncustomers\u2019 emergency calls, some of which would be during the night. It is offering a good salary\nand a small apartment next to the company premises.\n\nWhich person would be most likely to apply and be offered the position?\nA a confident person currently employed in installing security systems for the company\nB a person who has experience of answering customers\u2019 queries in a travel company\nC a recently qualified engineering graduate in security systems\nD a reliable person who says that he needs to live with his young family of five children\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: Why do female workers in many countries have a lower income than male workers?\nA Female workers are more experienced.\nB Female workers are more likely to be employed part-time.\nC Female workers are more likely to be in trade unions.\nD Female workers have more qualifications.\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: India is experiencing rapid growth in air travel. The number and size of airlines is increasing every\nyear.\n\nWhich effect arising from this growth is an external economy of scale?\nA Banks are more prepared to lend to large airlines rather than small airlines.\nB Colleges are established to train flight crew.\nC Fuel suppliers charge less to airlines that buy in bulk.\nD Larger airlines operate aircraft which can carry more passengers.\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: The financial director of a company adds up the cost for the firm of rent, insurance, new\nmachinery and the chief executive\u2019s basic salary. The director then divides that total by the firm\u2019s\noutput.\n\nWhat has the director calculated?\nA average fixed cost\nB average revenue\nC average total cost\nD average variable cost\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: If a perfectly competitive market becomes a monopoly, what will be likely to increase and what\nwill be likely to decrease?\n\n\nincrease\ndecrease\nA barriers to entry\neconomies of scale\nB consumer choice\nprices\nC long-run profits\ncompetition\nD output\nmarket share\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \n10\n5 0\ncosts\n($000)\noutput\n100\n\n\nWhat is the firm\u2019s total variable cost at an output of 100 units?\nA $250\nB $5000\nC $25 000\nD $30 000\n\n\n15 A government achieves a high rate of economic growth.\n\nWhat may result from this that might cause a conflict with other government aims?\nA it may increase government income\nB it may increase incomes for the lower paid\nC it may increase the supply of exports\nD it may increase the volume of imports\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: What type of tax is a tax of 10% on the price of petrol?\nA a direct tax\nB a progressive tax\nC an income tax\nD an indirect tax\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: What could a government in a developed economy do to decrease demand?\nA create a budget deficit\nB increase government spending\nC increase taxes\nD reduce interest rates\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: A country closed its oil wells because it had used up most of its supplies of oil.\n\nWhat type of unemployment would this cause?\nA cyclical\nB frictional\nC seasonal\nD structural\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: In a country, in one year, average transport prices rose by 15% and the price of electrical\nproducts fell by 15%. The two products had equal weights in the retail price index.\n\nIf no other prices changed, what happened to the index?\nA It fell by less than 15%.\nB It fell by over 15%.\nC It remained unchanged.\nD It rose by less than 15%.\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: There is a decrease in a country\u2019s birth rate.\n\nWhat must occur at the same time to lead to an increase in the country\u2019s population?\nA positive net migration and a fall in the death rate\nB positive net migration and a fall in the fertility rate\nC zero net migration and a fall in infant mortality\nD zero net migration and a fall in the fertility rate\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: In 2008, the Peruvian Government set itself the target of reducing the number of its people in\npoverty to 30% of the population.\n\nWhat change does not indicate that the Peruvian Government had made progress towards this\nobjective?\nA a rise in employment\nB a rise in infant mortality\nC a rise in life expectancy\nD a rise in the level of adult literacy\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: Which would cause a favourable change in the Kenyan trade in services (invisible) account?\nA A Kenyan company wins a contract to transport exports from Uganda.\nB A Kenyan tea company increases its exports.\nC A Kenyan trade delegation visits India.\nD A Zambian company increases its exports to Kenya.\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: What is most likely to result from an extension of specialisation in manufacturing?\nA for the consumer some prices will be reduced\nB for the country there will be less dependency on international trade\nC for the employee the work will become more varied\nD for the producer there will be less efficiency\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: What would reduce the volume of international trade in the world economy?\nA a German bank making a loan to a Nigerian company\nB a Japanese car manufacturer establishing a factory in the Czech Republic\nC the Canadian Government introducing quotas on Malaysian electronics products\nD the Swedish Government granting aid to Somalia\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nAn economy with few resources is encouraged to improve the quality of its human resources.\n\nWhich policy will lead to such an improvement?\nA conserving and protecting more of its natural resources\nB limiting the immigration of skilled labour\nC providing more opportunities for education and training\nD reducing the use of machines in production\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nA country raises the school leaving age from 15 to 17 years.\n\nWhat is the opportunity cost of this increased period of school education to the young people\naffected?\nA costs of training and employing more teachers\nB financial help necessary for school leavers who go to university\nC government expenditure on building extra classrooms\nD lost income from paid employment because of school attendance\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nIn a market there is a shortage of a good.\n\nWhat change would cause the market to come to an equilibrium?\nA a decrease in supply\nB a fall in price\nC an increase in demand\nD a rise in price\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nA product has a totally inelastic price elasticity of demand.\n\nWhat will happen to total revenue if the price of the product falls by 25%?\nA It will fall by 25%.\nB It will fall to zero.\nC It will remain unchanged.\nD It will rise by 25%.\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nIn 2014, a plan for a major new rail link funded by central and regional government was\nannounced. It would involve the redevelopment of a city area, generate 14 000 jobs and allow the\ndevelopment of 2000 homes and offices for private businesses.\n\nWhat economic concepts are indicated directly in the above statement?\nA budget surplus and inflation\nB factors of production and multinational companies\nC fiscal policy and mixed economy\nD regional unemployment and average wage rates\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nHow are social costs calculated?\n\nA fixed costs plus variable costs\n\nB private benefits less private costs\n\nC private costs plus external costs\n\nD social benefits less external costs\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nWhat is a disadvantage for a trade union representing workers in a company that has increased\nspecialisation?\nA Capital equipment can be substituted for labour.\nB Different abilities can be used fully.\nC Production levels are decreased.\nD Workers are able to gain a higher level of skill.\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nA government finance minister said that the purchasing power of most people\u2019s incomes had\nrisen in the last year.\n\nWhat must have increased for the purchasing power to rise?\nA money wages\nB net income after tax\nC real wages\nD wage rates\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: What is most likely to increase a firm\u2019s profits?\nA government controls on its prices\nB grants for the purchase of new machines\nC an increase in the wages paid to its workers\nD rising costs of its raw materials\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: Sohrab bought shares in a French telecommunications company operating in many countries.\n\nJoel owns and runs a mobile telephone accessories and repair shop.\n\nWhat is not identified above?\nA multinational company\nB partnership\nC public company\nD sole proprietor\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: A firm\u2019s average revenue is $20. It sells 1000 units.\n\nWhat is the firm\u2019s total revenue and the price of the product?\n\n\ntotal revenue\n($)\nprice\n($)\nA 20\n20\nB 1 000\n500\nC 20 000\n20\nD 20 000\n500\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: 0\nD 15\n120\n330\n\n\n16 Other things being equal, what is likely to decrease public spending?\nA an increase in the age of retirement\nB an increase in the birth rate\nC an increase in the school-leaving age\nD an increase in unemployment\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: When is a tax regressive?\nA when some goods have a lower tax than others\nB when the tax as a proportion of income decreases as income increases\nC when the tax is linked to the rate of inflation\nD when the tax is on incomes rather than on goods or services\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: The Government of India wishes to help the very poorest people.\n\nWhich policy would be most likely to achieve this?\nA lowering capital gains tax\nB lowering housing subsidies\nC lowering indirect taxation\nD lowering inheritance tax\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: Suppose the Indian Government raises the rate of interest.\n\nWhat is likely to be the direct effect on the economy?\nA It will raise any deficit on the current account.\nB It will raise the economic growth rate.\nC It will raise the foreign exchange rate.\nD It will raise the inflation rate.\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: What is involved in the construction of a retail price index?\nA a basket of goods\nB average incomes\nC economic growth rate\nD income tax rate\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: What identifies a recession?\nA a fall in the general price level\nB a fall in the level of national output\nC a fall in the real value of money\nD a fall in the stock market index\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: In the US Consumer Price Index (CPI), food has a weighting of 13.7%. In India food has a\nweighting of 46.2% in the CPI.\n\nWhat can be concluded from this?\nA Consumers in India spend more on food than US consumers.\nB Food is a bigger proportion of consumer spending in India than in the US.\nC The farming sector\u2019s output of food is higher in India than in the US.\nD The price of food is rising more rapidly in India than in the US.\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: In many developing economies there is a high rate of population growth.\n\nWhat is a cause of this?\nA Jobseekers migrate from rural to urban centres.\nB Poor people have many children to provide labour on family farms.\nC There is increased resistance to life saving drugs.\nD There is not enough clean water.\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: A country has a birth rate of 30 per 1000 and a death rate of 35 per 1000 and no migration.\n\nWhat is most likely to cause the population to fall?\nA The birth rate decreases and the death rate increases.\nB The birth rate increases and the death rate remains the same.\nC The birth rate remains constant and the death rate decreases.\nD The increase in the birth rate is greater than the increase in the death rate.\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: What is likely to cause a rise in a country\u2019s foreign exchange rate?\nA a fall in its exports of goods and services\nB a fall in its imports of goods and services\nC a fall in its inflow of income\nD a rise in its outflow of transfers\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: Drinks producers in India are resisting plans to remove tariffs on imported drinks. They claim that\na reduction in tariffs would destroy the emerging drinks industry with large-scale imports of cheap\ndrinks.\n\nWhich argument for protectionism are they putting forward?\nA the declining industry argument\nB the infant industry argument\nC the strategic industry argument\nD the sunset industry argument\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: Who is most likely to benefit if India bans all steel imports?\n\nA buyers of steel in India\nB foreign steel producers\nC Indian firms buying steel\nD Indian firms selling steel at home\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: What is certain to encourage a higher level of international trade?\nA conservation of resources and unstable exchange rates\nB exploitation of resources and wider use of quotas\nC increased support for home industries and increased tariffs\nD more specialisation and falling transport costs\n\n\nBLANK PAGE\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nA person bought a shop and stocked it with fresh fruit. He employed one member of his family to\nhelp in the shop.\n\nWhich factors of production have been used?\nA labour and capital only\nB labour, capital and enterprise only\nC land and labour only\nD land, labour, capital and enterprise\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nWhat is an example of market failure?\nA a growth of competition\nB a spread of pollution\nC a surplus of production in the short term\nD an existence of scarcity\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nWhat will be the impact on the market for oil of the closure of the world\u2019s largest oil field for\nmaintenance work?\nA a movement down the supply curve\nB a movement up the demand curve\nC a shift of the demand curve to the left\nD a shift of the supply curve to the right\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nA product has a price elasticity of demand that is greater than one.\n\nWhat will happen to total revenue if the price of the product is reduced by 3%?\nA It will fall by more than 3%.\nB It will fall to zero.\nC It will be unchanged.\nD It will rise.\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nWhy are some assembly workers poorly paid?\nA because their work is exhausting\nB because their work is repetitive\nC because their work is unskilled\nD because they work long hours\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: What is usually a function of a trade union?\nA It advertises the products that the members make.\nB It conducts negotiations with employers for increased wages.\nC It hires company employees.\nD It negotiates with suppliers for reduced costs of materials.\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: A firm\u2019s aim is to become a monopoly supplier.\n\nWhich policy is it most likely to use to eliminate competition?\nA adopt price reductions and advertising\nB avoid diseconomies of scale\nC maximise output and profit\nD reduce financial barriers to entry\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: When is a firm most likely to reduce its demand for labour?\n\nA when the demand for the final good increases\nB when the firm\u2019s profitability increases\nC when the price of labour decreases\nD when the productivity of labour decreases\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: The high volume of goods sold by large supermarkets enables them to reduce prices, but the\nmost important advantage that these businesses have is that they can sell non-food items as well\nas food.\n\nWhich economic results does the statement suggest are available to large supermarkets?\nA economies of scale and diversification\nB external benefits and specialisation\nC horizontal integration and optimum output\nD increased sales and diminishing returns\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: A firm produces five units of output at an average cost of $20 per unit. The cost of the sixth unit\nis $26.\n\nWhat is the average cost of six units?\nA $4.33\nB $6\nC $8.33\nD $21\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: What is not a public sector expenditure?\nA claims paid on travel insurance for cancelled flights\nB collections of rubbish by a local council to meet regulations on recycling waste\nC grants from central funds to compensate people whose property has been damaged by\nstorms\nD the establishment of a national database to assist the police in finding criminals\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: The Indian government uses direct and indirect taxation.\n\nWhich is a direct tax?\nA corporate (profits) tax\nB customs duty\nC goods and services tax\nD petrol tax\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: A worker earns $60 000 a year and pays 25% income tax. He spent $2000 on furniture and\n$5000 on a computer and paid 20% sales tax on each.\n\nHow much indirect tax did he pay?\nA $1000\nB $1400\nC $15 000\nD $16 400\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \n25\n30\n20\n15\n10\n5 0\nS3\nS1\nD1\nS2\nquantity supplied\n(\u2019000 kilos)\nprice\n($ per kilo)\nX \n\nWhat will be the new equilibrium price and quantity supplied as a result of the subsidy?\n\n\nequilibrium price\n($ per kilo)\nquantity supplied\n(\u2019000 kilos)\nA 10\n20\nB 13\n25\nC 15\n20\nD 20\n10\n\n\n20 What may cause an immediate decrease in the working population?\nA a falling death rate\nB a falling infant mortality rate\nC a rising birth rate\nD a rising rate of net emigration\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: Which combination of changes in national output and population would cause an increase in GDP\nper head?\n\n\nnational output\npopulation\nA decrease by 4%\nunchanged\nB decrease by 5%\ndecrease by 6%\nC increase by 3%\nincrease by 5%\nD unchanged\nincrease by 2%\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: In a year the rate of inflation in a country was 3%. During that year company managers\u2019 salaries\nrose by 6% and office workers\u2019 wages rose by 2%.\n\nWhat happened to real income (purchasing power)?\n\n\ncompany\nmanagers\noffice\nworkers\nA fell\nfell\nB fell\nrose\nC rose\nfell\nD rose\nrose\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: Developing countries often wish to prevent the population in rural areas moving to the towns.\nInvestment grants are given to companies if they set up their businesses in rural areas.\n\nWhat is this policy intended to achieve?\nA decreased government expenditure\nB decreased transport costs\nC increased economies of scale\nD increased use of labour\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: The population structure of many developed countries is changing. Birth rates are low, those\nover 65 are living longer and the working population (16-65 years) is a smaller proportion of the\ntotal population.\n\nWhat is the most likely consequence of this changing structure?\nA Economic migrants make up shortages in the working population.\nB Overall the standard of living is gradually falling.\nC The population is healthier and needs less medical care.\nD The ratio of those under 16 dependent on the working population is rising.\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \n24.2\nIndia\n64.8\n1.5\n60\n23.0\nPakistan\n65.6\n1.6\n42\n27.2\n\nOn the basis of the information given, what is the likely ranking order of the four countries in\nterms of development, starting from the most developed to the least developed?\nA Bangladesh \u2192 India \u2192 Pakistan \u2192 Egypt\nB Egypt \u2192 Pakistan \u2192 India \u2192 Bangladesh\nC India \u2192 Egypt \u2192 Bangladesh \u2192 Pakistan\nD Pakistan \u2192 Bangladesh \u2192 Egypt \u2192 India\n\n\n27 The table shows details of India\u2019s current account of the balance of payments in the 1st quarter of\n2014.\n\n\n$ billion\ntrade in goods (visible) balance\n\u201334\ntrade in services (invisible) balance\n? primary income (income) balance\n\u20137\nsecondary income (current transfers) balance\n16\ncurrent account balance\n\u20138\n\nWhat is the trade in services (invisible) balance?\nA surplus of $9bn\nB surplus of $17bn\nC surplus of $27bn\nD surplus of $33bn\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: Which policy is a form of protectionism?\nA a tax on emissions\nB a tax on imports\nC a tax on income\nD a tax on property\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: When does free trade occur?\nA when goods are exported with government subsidies\nB when goods are given as part of an aid programme\nC when goods are traded using barter\nD when goods face no import barriers\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nWhat best describes the problem of scarcity?\nA All consumer wants must be satisfied.\nB All resources are free at the point of use.\nC There are limited resources and unlimited wants.\nD There are unlimited resources and limited wants.\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nWhat is an example of the purchase of a capital good?\nA a farm owner purchasing additional land\nB a farm owner purchasing a television\nC a farm owner purchasing a tractor\nD a farm worker purchasing some seeds\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nA student decides to buy a ticket for a concert instead of buying a new shirt.\n\nWhat is the opportunity cost of buying the ticket?\nA the concert\nB the price of the ticket to the concert\nC the shirt\nD the time spent purchasing the ticket\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nIn a market system who has the most important role in influencing the allocation of resources?\nA consumers\nB entrepreneurs\nC government officials\nD producers\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nWhat is an external cost of mining coal?\nA the cost of purchasing mining equipment\nB the extra cleaning costs of local residents\u2019 houses because of coal dust\nC the extra cleaning costs of the mine buildings because of coal dust\nD the cost to the mine owners to remove waste\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nWhat is a function of a stock exchange?\nA It allows company shares to be traded.\nB It enables tourists to purchase foreign currency.\nC It provides a market for firms to sell their products.\nD It sets the rate of interest in an economy.\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nWhat is a direct benefit to a worker of specialisation?\nA the higher output that may lead to higher earnings\nB the higher output that may lead to higher profits\nC the higher output that may lead to lower costs per unit produced\nD the longer training period that is required before starting work\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: A trade union succeeds in raising the wages in an industry above the equilibrium wage.\n\nHow would the demand and supply of labour change?\n\n\nchange in quantity\nof labour demanded\nchange in quantity\nof labour supplied\nA fall\nfall\nB fall\nrise\nC rise\nfall\nD rise\nrise\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: What is most likely to result from an increase in income tax?\nA a fall in consumer spending\nB a fall in government spending\nC a rise in business investment\nD a rise in the level of imports\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: Which statement explains why firms in perfect competition are not able to exploit consumers?\nA The firms can restrict output.\nB The products are differentiated.\nC There are barriers to entry.\nD There is perfect information.\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: A company with a chain of restaurants bought another chain of restaurants.\n\nHow is this purchase most likely to be classified?\nA conglomerate merger\nB diversification\nC horizontal integration\nD vertical integration\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: A company\u2019s annual report suggested that it had benefited from some changes.\n\nWhich change is an internal economy of scale for this company?\nA an improvement in road and rail facilities that has reduced its distribution costs\nB an increase in the number of local specialist workers that it could recruit\nC the introduction of new training at a local college for which staff have enrolled\nD the reduction in the company\u2019s costs by the purchase of a factory supplying components\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: A government believes that consumption of a certain good will be of benefit to society.\n\nWhich policy is most likely to encourage producers to increase their output of that good?\nA an increase in the period required for training the industry\u2019s workers\nB an increase in the regulations affecting businesses\nC an increase in the subsidies for that good\nD an increase in the taxation of that good\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: Which statement describes a progressive tax?\nA a tax that has a higher percentage rate as income rises\nB a tax that increases government income over time\nC a tax that places an increasing burden on the poor\nD a tax that rises in line with the rate of inflation\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: Which combination of government policies is most likely to reduce unemployment?\n\n\nincome\ntax rate\ngovernment\nspending\nrate of\ninterest\nA decrease\ndecrease\nincrease\nB decrease\nincrease\ndecrease\nC increase\ndecrease\ndecrease\nD increase\nincrease\nincrease\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: Which pair of government actions combines a fiscal policy with a supply-side policy?\nA changing government spending with changing interest rates\nB cutting tax rates with providing information on job vacancies\nC limiting bank lending with the privatisation of industry\nD restricting credit with less control over labour markets\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: What is a recession?\nA a period when incomes rise by less than inflation\nB a period when prices are falling continuously for twelve months\nC a period when real GDP is declining for two consecutive quarters\nD a period when unemployment is rising\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: An economy is suffering from a period of deflation.\n\nWhat does this mean for the economy?\nA Consumers may delay purchase of some products.\nB Purchasing power of consumers falls.\nC Tax revenues for the government will rise.\nD The real value of personal savings falls.\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: Official statistics in 2010 showed South Africa had a very high unemployment rate at around\n25%, although wages were double those in Brazil.\n\nWhat might be a reason for South Africa\u2019s high wages in a time of high unemployment compared\nwith Brazil?\nA a skilled workforce in Brazil\nB high levels of savings in South Africa\nC more labour-intensive production in Brazil\nD strong trade unions in South Africa\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: What is a common feature of developed countries?\nA a high fertility rate\nB a low population\nC high net emigration\nD low birth rates\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: Which combination of changes in a government\u2019s budget will lead to greater income inequality?\n\n\ndirect taxes\nindirect taxes\nhealth and\neducation spending\nA decrease\ndecrease\nincrease\nB decrease\nincrease\ndecrease\nC increase\ndecrease\ndecrease\nD increase\nincrease\nincrease\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: What would cause a favourable change in the Indian trade in services (invisible) account?\nA A Japanese company invests in a subsidiary in India.\nB A large Indian company increases its exports of goods.\nC A Malaysian company increases its exports to India.\nD An Indian company wins a contract to transport South African exports.\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: In October 2015, one UK pound could be exchanged for 100 Indian rupees. By October 2016,\none UK pound could be exchanged for 80 Indian rupees.\n\nWhat would be a short-term consequence of this change?\nA Economic growth in India would increase.\nB Indian manufacturers would earn higher profits from exports to the UK.\nC Inflationary pressure in the UK would reduce.\nD UK manufacturers would find it easier to export to India.\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: A country imports oil which is used in the production and distribution of goods. The country has\nalso experienced a rise in incomes which has resulted in a large increase in the demand for\ngoods, some of which it imports.\n\nWhat is likely to happen to the country\u2019s balance of trade in goods (visible) and to the price of oil?\n\n\nbalance of\ntrade in goods\nprice of oil\nA improves\nfalls\nB improves\nrises\nC worsens\nfalls\nD worsens\nrises\n\n\nBLANK PAGE\nBLANK PAGE\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nAll countries need to produce food.\n\nWhich type of agriculture would make the best use of the resources of developing and developed\neconomies?\n\n\ndeveloping\ndeveloped\nA capital-intensive\ncapital-intensive\nB capital-intensive\nlabour-intensive\nC labour-intensive\ncapital-intensive\nD labour-intensive\nlabour-intensive\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nA farmer reduces the land used to grow wheat from 80 hectares to 60 hectares and increases the\nuse of the land for growing potatoes from 80 to 100 hectares.\n\nWhat is the opportunity cost of this change?\nA The output from 20 hectares used for growing potatoes.\nB The output from 20 hectares used for growing wheat.\nC The output from 60 hectares used for growing wheat.\nD The output from 80 hectares used for growing potatoes.\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nWhat can be found in a market economy?\nA externalities and monopolies\nB interest rates and public goods\nC public corporations and market prices\nD tax rates and commercial banks\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nA private sector firm is given a contract by the government to supply a country\u2019s water.\n\nWhich government directive will minimise the risk of market failure?\nA allow the firm to ration water rather than meet demand\nB ensure the firm\u2019s supply includes all areas which are expensive to service\nC insist that the firm aims to maximise profits\nD instruct the firm to provide water only to those who can pay for it\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nWhat is meant by the equilibrium price in the market for a good?\nA the average price paid by consumers\nB the price at which maximum profit is made\nC the price at which the producer breaks even\nD the price at which the supply and demand curves intersect\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nWhat could discourage women from seeking employment?\n\nA More education and training are provided.\nB More flexible and part-time jobs are available.\nC There are fewer promotion opportunities for women.\nD There is a shift in employment to the services sector.\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nWhat would be least likely to act as a store of value during a period of rapid inflation?\nA cash\nB gold\nC property\nD shares\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: Which type of business is always in the public sector?\nA monopoly\nB multinational corporation\nC public corporation\nD public limited company\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: When will a firm maximise its profits?\nA when it excludes a rival supplier from the market\nB when it produces where average cost and average revenue are equal\nC when it sells as many products in as many different markets as it can\nD when the difference between total cost and total revenue is greatest\n\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: A firm\u2019s average revenue is $10. It sells 2000 units.\n\nWhat is the firm\u2019s total revenue and the price of the product?\n\n\ntotal revenue\n($)\nprice\n($)\nA 10\n10\nB 2 000\n200\nC 20 000\n10\nD 20 000\n200\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: Which measure would a government take to reduce a current account deficit?\nA increase tariffs\nB increase value added tax\nC reduce income tax\nD reduce domestic subsidies\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: What is an example of an expansionary fiscal policy?\nA decreased budget deficit\nB higher interest rates\nC increased money supply\nD reduced tax rates\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: A government lowers interest rates to encourage more borrowing and spending by households to\nincrease economic growth.\n\nWhy could this lead to a conflict with other government aims?\nA It could cause uncertainty and lead to lower demand.\nB It could encourage more savings and lead to higher unemployment.\nC It could lead to lower prices of consumer goods and result in deflation.\nD It could stimulate consumer demand and lead to inflation.\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: Which policy would be most likely to reduce unemployment in the short run?\nA a programme of privatisation\nB a reduction in the standard rate of income tax\nC grants to firms to research new technology\nD removal of all restrictions on imports into the country\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: A country has the highest GDP per head in the world.\n\nWhat is this information most likely to suggest about the country?\nA It has the world\u2019s biggest economy.\nB It has the world\u2019s fastest economic growth rate.\nC It has the world\u2019s greatest size of population.\nD It has the world\u2019s highest standard of living.\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: What is included in the Human Development Index (HDI) of a country?\nA level of net immigration\nB life expectancy at birth\nC population size\nD rate of population growth\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: What is an example of someone who lost their job because of structural unemployment?\nA Aneesha lost her job as an engineer when her firm had to make redundancies in a recession.\nB Jamie lost his job as an ice cream seller during the winter months when little ice cream was\nsold.\nC Sunjeev decided to stop working and claim benefits when the government increased\nunemployment benefits.\nD Sunjit lost his job as a bank worker when the bank replaced his job with a new computer\nsystem.\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: An economy experienced deflation.\n\nWhich combination shows the likely outcome of this?\n\n\nconsumer\nconfidence\nprice\nlevel\ninvestor\nconfidence\nA decrease\ndecrease\ndecrease\nB decrease\nincrease\ndecrease\nC increase\ndecrease\nincrease\nD increase\nincrease\nincrease\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: A developing country starts to show increases in economic growth.\n\nWhat is most likely to occur?\nA a reduction in imports\nB a reduction in the number of doctors per capita\nC an increase in absolute poverty\nD an increase in incomes\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: A country\u2019s minister for agriculture said\n\n\u201cthe biggest challenge the country faces is to develop irrigation so that we\nare not at the mercy of the weather for crucial export earnings\u201d.\n\nWhich type of country is this most likely to be?\nA developed, exporting manufactured goods\nB developed, exporting services\nC developing, exporting primary commodities\nD developing, exporting services\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \n3 C\nIndonesia\n24\n8 D\nMauritius\n21\n7 \n\n27 What usually decreases when there is a depreciation of a country\u2019s foreign exchange rate?\nA the level of national debt\nB the level of trade protection\nC the price of exports\nD the price of imports\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: A country imposes tariffs and quotas on imported goods.\n\nWhat will citizens of that country experience?\nA higher prices\nB higher unemployment\nC higher welfare\nD wider consumer choice\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: Skin creams preventing sunburn made in the European Union (EU) are more effective than those\nmade in the United States (US). US tourists stock up on the creams when visiting Europe. Such\ncreams are banned from production in the US because of the chemicals in them. In 2013,\nnegotiations began to remove this ban in order to allow production in the US.\n\nHow is this freer trade likely to affect manufacturers of skin creams in the US and the EU?\n\n\nmanufacturers\nin the US\nmanufacturers\nin the EU\nA gain\ngain\nB gain\nlose\nC lose\ngain\nD lose\nlose\n\n\nBLANK PAGE\nBLANK PAGE\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nSanjay is a risk taker and sets up a restaurant in Chennai. Sanjay works for the business as a\nchef. He leases the restaurant building from Raghav and employs him to serve the customers.\n\nWhich income is earned by Sanjay and Raghav?\n\n\nSanjay\nRaghav\nA interest and profit\nwages only\nB interest and wages\nprofits and rent\nC profits and wages\nrent and wages\nD profits only\ninterest and wages\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nA government reduces social security spending by $10 bn in order to increase defence spending\nby $10 bn.\n\nWhat is this an example of?\nA expansionary fiscal policy\nB market forces\nC price stability\nD reallocation of resources\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nWhat is included in macroeconomics?\nA the causes of a change in the price of one product\nB the causes of a market failure\nC the causes of determinants of price elasticities of supply\nD the causes of economic growth\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nWhat is an advantage of a market economy in the allocation of resources?\nA It ensures that all consumers are willing to pay the same price.\nB It fixes prices based on costs of production.\nC It guarantees suppliers will make a profit.\nD It indicates the relative demand for goods and services.\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nWhich characteristics of a product will cause market failure?\nA Information about the product is known equally by consumers and producers.\nB The consumption of the product has no external benefits.\nC The product is non-rival and non-excludable.\nD The production of the product has no external costs.\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nWhich function does a central bank provide for the general public?\nA accepting deposits\nB issuing banknotes\nC making loans\nD providing overdrafts\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: What might cause a rise in wages?\nA a more elastic supply of labour\nB an increase in the size of the labour force\nC improved fringe benefits for workers\nD the introduction of a national minimum wage\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: A national trade union wishes to increase the wages of its members without reducing the\nnumbers employed.\n\nWhich factor would help the union to do this?\nA The demand for the industry\u2019s product is increasing.\nB The industry consists of a small number of well-organised employers.\nC The union workers have low-level skills.\nD The workers\u2019 wages are the largest cost of the industry.\n\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: What will occur when there is a conglomerate merger?\nA increased control over supply of raw materials\nB increased risk-bearing economies of scale\nC reduced marketing economies of scale\nD reduced technical economies of scale\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: What is total revenue?\nA the money received by the firm for each additional unit of output sold\nB the price of the good multiplied by the total quantity sold\nC the revenue per unit sold divided by the quantity sold\nD the revenue per unit sold minus the cost per unit sold\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: How would a state-owned oil refining firm be classified?\nA as a multi-national company (MNC) in the private sector\nB as a private sector firm in the tertiary sector\nC as a public sector firm in the primary sector\nD as a public sector firm in the secondary sector\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: What is included in a government\u2019s budget?\nA the balance of government revenue and government expenditure\nB the balance of export revenue and import expenditure\nC the difference between investment and saving\nD the difference between social benefits and social costs of production\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: A country has rapidly increasing inflation.\n\nWhat is an example of a monetary policy measure to reduce this problem?\nA increasing income tax\nB increasing interest rates\nC introducing maximum prices for some products\nD subsidising key industries\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: Deflation is a sustained fall in the general price level.\n\nWhat might cause deflation?\nA insufficient private capital investment\nB loss of confidence in the government\u2019s economic policies\nC rising oil prices\nD shortages of skilled labour in relation to demand\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: Tax is charged at 1.45% on all wages earned to pay for basic medical provision.\n\nHow would this tax be described?\nA direct and proportional\nB direct and regressive\nC indirect and proportional\nD indirect and regressive\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: What is included in the construction of the Consumer Prices Index (CPI)?\nA a base year\nB incomes\nC price elasticity of demand\nD quantity supplied\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: Which country is likely to have the highest standard of living?\n\n\nbirth rate\ndeath rate\ninfant mortality\nrate\nlife expectancy\nA 41\n20\n31\n49\nB 32\n14\n29\n59\nC 25\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \n6 25\n79\nD 25\n5 22\n79\n\n\n25 Which statement about poverty is correct?\nA Absolute poverty occurs when income falls below what is needed for survival.\nB An advanced economy is likely to have a higher level of absolute poverty than relative poverty.\nC It is impossible for relative poverty to rise as absolute poverty falls.\nD Relative poverty is measured by the same goods and services in all countries.\n\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: The United Nations (UN) predicts that the population in low-income countries will increase.\n\nWhat is likely to be a cause of this?\nA Climate change will lead to lower food output and starvation.\nB Improved education for girls will lead to a small decline in birth rates.\nC Increasing numbers of people will migrate to higher income countries.\nD Modern medicine and sanitation will lead to a rapid decline in death rates.\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: Which method of trade protection would enable domestic firms to lower their prices and undercut\nthe price of imported goods?\nA a subsidy\nB a tariff\nC an embargo\nD an import quota\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: How might a multinational company (MNC) directly benefit a host country?\nA It creates local employment.\nB It depletes local natural resources.\nC It imports raw materials.\nD It receives tax concessions.\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: A country has a current account deficit on its balance of payments.\n\nWhich measure is most likely to reduce the deficit?\nA a cut in interest rates\nB a cut in the rate of income tax\nC a depreciation of the exchange rate\nD an increase in government expenditure\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: A country experienced a deficit on each of its trade in goods, primary income and secondary\nincome. Overall, it had a surplus on the current account of its balance of payments.\n\nWhat must this mean?\nA It had a floating exchange rate.\nB It had a surplus on its trade in services.\nC It had a surplus on the government\u2019s budget.\nD It was a low-income country.\nBLANK PAGE\n\nBLANK PAGE\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \ninflation\nA population\nB supply\nC unemployment\nD The diagram shows the choices for an individual between leisure and earnings.\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \n24\n20\n16\n12\n8 4\n0 20\n40\n60\n80\n100\n120\nearnings $\nhours of\nleisure\nper day\nX Y\nThe person decides to take a job that gives more leisure time.\nWhat is the opportunity cost to the individual of moving from position Y to position X?\n$20\nA $80\nB 4 hours of leisure per day\nC 12 hours of leisure per day\nD A student defined opportunity cost as \u2018the alternative given up when a course of action is followed\u2019.\nWhy is this definition inadequate?\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nThe \u2018next best\u2019 alternative is not stressed.\nA The type of economic system is not identified.\nB There is no mention of money values.\nC There is no reference to finite resources and unlimited wants.\nD 03 0455 12 2023 1 16\n\u00a9 UCLES 2023\nThe market for a good was in equilibrium. A change occurred which resulted in a new equilibrium\nwith a higher price for the good and a lower quantity traded.\nWhich change would have caused this?\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \na change in tastes\nA an increase in income\nB a rise in the price of the product\nC a successful advertising campaign for the product\nD \u00a9 UCLES 2023\n03 0455 12 2023 1 16\nIn a year when there were big increases in demand for new cars, many used cars also came onto\nthe market.\nThe diagrams show the demand for and the supply of new and used cars. The original equilibrium\nposition was at E in each case.\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nquantity\nnew cars\nprice\nO D2\nD1\nS1\nD3\nX Y\nE quantity\nused cars\nprice\nO D1\nS1\nS2\nD2\nX Y\nE What will be the new equilibrium position in each market?\nused cars\nnew cars\nX X\nA Y\nX B\nX Y\nC Y\nY D\nA government places an indirect tax on a good which has price-elastic demand.\nWhat is the result?\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nquantity demanded\nof the good\ntotal expenditure\non the good\ndecrease\ndecrease\nA increase\ndecrease\nB decrease\nincrease\nC increase\nincrease\nD \u00a9 UCLES 2023\n03 0455 12 2023 1 16\nThe price elasticity of demand for cigarettes is estimated to be 0.5. The government introduces a\ntax on cigarettes to reduce consumption.\nBy how much must the price of cigarettes rise to reduce consumption by 10%?\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \n20%\nD 15%\nC 10%\nB 5%\nA The diagram shows the demand for and the supply of bread.\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nprice\nquantity\nO S\nD P1\nA maximum price P1 is fixed by the government.\nWhat is likely to be the immediate result of this?\na movement of the demand curve to the right\nA a movement of the supply curve to the right\nB a shortage of bread\nC a surplus of bread\nD What is a function of commercial banks?\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \naccept deposits and savings\nA lender of last resort to government\nB manage the national debt\nC operate monetary policy\nD \u00a9 UCLES 2023\n03 0455 12 2023 1 16\nThe table shows spending in the leisure sector of a country in 1995, 1999 and 2005.\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nwage\nrate\nquantity of labour\nA B\nC D\nO wage\nrate\nquantity of labour\nO wage\nrate\nquantity of labour\nO wage\nrate\nquantity of labour\nO S\nS S\nS \u00a9 UCLES 2023\n03 0455 12 2023 1 16\nWhat would be likely to happen within a country if its government granted more work permits to\ndoctors coming from other countries?\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nincreased demand for doctors\nA increased productivity of doctors\nB increased salaries for doctors\nC increased supply of doctors\nD What is not a benefit of trade union membership for a worker?\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nachieving higher wages for workers\nA negotiating a higher rate of interest on a bank loan for workers\nB providing support to workers when being made unemployed\nC an improvement in health and safety standards at work\nD What will happen to a firm that expands to take advantage of economies of scale?\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nAverage costs of production will decrease.\nA Average costs of production will increase.\nB Profits will decrease.\nC The price of the firm\u2019s products will increase.\nD The table shows total fixed and total variable costs at different levels of output for a firm.\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \ntotal\nvariable cost\n$ total\nfixed cost\n$ output\n1000\n1500\n2000\n2500\n1000\n1000\n1000\n1000\n100\n200\n300\n400\nWhat happens as output rises?\nAverage fixed cost falls.\nA Average fixed cost rises.\nB Average variable cost remains constant.\nC Average variable cost rises.\nD \u00a9 UCLES 2023\n03 0455 12 2023 1 16\nWhich characteristics are found in a monopoly?\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nfreedom of entry to the market and a single seller\nA freedom of entry to the market and many sellers\nB many buyers and a single seller\nC many buyers and many sellers\nD What is deflation?\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \na decrease in the claimant count\nA a decrease in the Consumer Prices Index\nB a decrease in the Human Development Index\nC a decrease in the real Gross Domestic Product\nD What is the likely outcome of an expansionary monetary policy?\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nBorrowing by consumers falls as the money supply increases.\nA Firms expand to meet higher consumer demand.\nB Prices fall as total supply exceeds total demand.\nC Wages rise due to a lower rate of inflation.\nD In the past, governments have adopted policies to try to end a recession in their country and increase\neconomic growth.\nWhich combination of policies is most likely to achieve this?\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nlower taxes and decrease government spending\nA lower taxes and increase government spending\nB raise taxes and decrease government spending\nC raise taxes and increase government spending\nD \u00a9 UCLES 2023\n03 0455 12 2023 1 16\nThe table shows taxes as a percentage of Gross Domestic Product (GDP) for four countries.\nFrom this information, which country had the highest percentage of direct taxation as a percentage\nof GDP?\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \ntax on goods\nand services\n% tax on\ndividends %\ntax on\nbusiness\nprofits %\nincome tax %\n5 2\n14\n12\nA 14\n2 15\n14\nB 10\n5 13\n17\nC 10\n1 10\n18\nD As a country develops economically, what is most likely to happen?\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nThere will be an increase in productivity.\nA There will be an increase in the birth rate.\nB There will be an increase in the death rate.\nC There will be reduced occupational mobility.\nD Which government policy would be most likely to reduce structural unemployment?\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \na decrease in the rate of interest\nA a decrease in the tax on goods and services\nB an increase in spending on education and training\nC an increase in tariffs on imported goods and services\nD \u00a9 UCLES 2023\n03 0455 12 2023 1 16\nA government has a target of keeping inflation between 2% and 3%.\nThe diagram shows the rate of inflation over a four-year period.\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \n1 2\n3 4\n5 4\n3 2\n1 0\n\u20131\nyear\ninflation\ntarget\nrate of\ninflation\n% What can be deduced from the diagram?\nThe government target was missed in two years.\nA The price level fell in two years.\nB The price level was at its highest in the first year.\nC The real value of money fell in three years.\nD A town has a population of 20000. The birth rate is 25 per thousand and the death rate is 15 per\nthousand. The number of people moving in and out of the town exactly balances.\nWhat will the population be at the end of one year?\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \n22000\nD 20200\nC 20010\nB 19800\nA What is most likely to be found in a high-income economy?\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nhigh\nlow\ninfant mortality rate\naccess to safe water\nA adult literacy rate\nbirth rate\nB access to safe water\ngross domestic product per head\nC death rate\ninfant mortality rate\nD \u00a9 UCLES 2023\n03 0455 12 2023 1 16\nThe table shows figures for the real GDP of a country in a particular year.\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nquarter 4\n($bn)\nquarter 3\n($bn)\nquarter 2\n($bn)\nquarter 1\n($bn)\n98\n99\n101\n100\nA quarter is three months.\nAt the end of which quarter had the economy experienced a recession?\nquarter 1\nA quarter 2\nB quarter 3\nC quarter 4\nD What is a quota in international trade?\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \na government grant to encourage production\nA a limit on the quantity of imports\nB a tax on imports\nC an administrative and technical barrier\nD What is an advantage of a floating exchange rate for an economy?\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nIt can correct a current account deficit or surplus.\nA It creates certainty for firms importing goods.\nB It increases government control of the economy.\nC It stops money flows into and out of the economy.\nD \u00a9 UCLES 2023\n03 0455 12 2023 1 16\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nAn unemployed worker accepts a job.\nWhich of the following is the opportunity cost of this decision?\nA the cost of travel to work\nB the income from the new job\nC the leisure time lost\nD the training in the new job\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nA hospital cannot treat all the people that need treatment. This is an example of\nA excess supply.\nB limited wants.\nC scarcity.\nD unlimited resources.\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nEconomic growth in Russia and China used to be led by the public sector. Now it results more\nfrom activities in the private sector. However, both sectors are important.\nWhich term describes the current system in Russia and China?\nA market\nB mixed\nC planned\nD subsistence\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nWhat is necessary for a company to be classified as a multi-national?\nA It diversifies its range of products.\nB It exports most of its output.\nC It increases its scale of production.\nD It produces some of its output in different countries.\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nWhich advantage is most likely to enable a small retailer to compete with larger stores?\nA a convenient location\nB a wide range of products\nC internal economies of scale\nD national advertising\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nIn 2001 some countries, including India and Pakistan, criticised the European Union for\ncontinuing to protect European farmers with a subsidy while expecting poorer African countries\nnot to restrict trade.\nIdentify the concepts that are not involved in this situation.\nA developing and developed economies\nB free trade and protection\nC market prices and official intervention\nD multi-nationals and public corporations\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nA commercial bank is appointed to act as a country\u2019s central bank.\nWhat new function would it now have?\nA controlling monetary policy\nB dealing in foreign exchange\nC ensuring security for loans\nD holding liquid assets\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nWhich trade union action is most likely to have harmful effects on the productivity of a firm?\nA acceptance of new technology\nB agreement to a bonus system\nC opposition to planned redundancies\nD participation in a profit-sharing scheme\n\n Answer: The threshold (minimum mark) for B is set halfway between those for Grades A and C." }, { "notes": "", "input": "", "output": "Question: \n12\n40\n10\n14\nWhat will be the effect if the government imposes a minimum price of $40 per tonne?\nA a fall in the price of X\nB a shortage of X\nC a surplus of X\nD a waiting-list for X\n12\nThe diagram shows the market for white sugar which is in equilibrium at X.\nA report is published stating that brown sugar is healthier to eat than white sugar.\nWhat will be the new equilibrium position for white sugar?\nX A\nB C\nD O\nprice\nquantity\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nNazmin Uddin works in a local office as a secretary three days a week. She lives with her parents\nin a small apartment.\nMeer Ali owns a successful fitness centre that employs about twenty people and lives in a large\nhouse.\nWhich is likely to be true?\nA Nazmin spends a smaller proportion of her income than Meer.\nB Nazmin saves most of her income.\nC Nazmin would find it easier than Meer to borrow money.\nD Nazmin has a lower disposable income than Meer.\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nIn a country, male workers on average earn more than female workers, although male and\nfemale workers receive equal pay for equal work.\nWhat could explain this?\nA Female workers are more experienced.\nB Female workers are more likely to achieve promotion.\nC Male workers are more likely to be in trade unions.\nD Male workers have fewer qualifications.\nO price\nquantity\nA B\nD C\nX 18\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nWhich of the following groups of workers is most likely to be successful in obtaining a wage\nincrease?\nA building workers during a period of bad weather\nB computer operators when firms are installing new computers\nC doctors when entrance qualifications to the profession are reduced\nD farm workers as farming becomes more mechanised\n\n Answer: 12" }, { "notes": "", "input": "", "output": "Question: \nThere is an increase in interest rates.\nWhat is the likely effect on saving and borrowing?\nsaving\nborrowing\nA falls\nfalls\nB falls\nrises\nC rises\nfalls\nD rises\nrises\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nA firm is producing an output which enables it to make more than normal profit.\nWhat must be true at that output?\nA Average revenue must equal average cost.\nB Average revenue must be greater than total revenue.\nC Total revenue must be greater than total cost.\nD Variable cost must equal price.\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nThe price of a firm\u2019s product is $10. It sells 2000 units.\nWhat is the firm\u2019s total revenue (TR) and average revenue (AR)?\nTR ($)\nAR ($)\nA 10\n10\nB 2 000\n200\nC 20 000\n10\nD 20 000\n200\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nWhat would improve a firm's profits in the short run?\nA government controls on its prices\nB grants for the purchase of new machines\nC an increase in the wages paid to its workers\nD rising costs of raw materials\n\n Answer: Component 6" }, { "notes": "", "input": "", "output": "Question: \nWhat is likely to result in the creation of a large business rather than a small business?\nA expensive technology that reduces the average cost of producing standardised products\nB higher incomes that allow consumers to be more selective in purchases\nC unemployment that causes people to set up their own companies\nD widely scattered markets that cause high transport costs\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nWhich of the following is likely to be a disadvantage of economic growth?\nA Government tax revenue falls.\nB Resources are depleted.\nC The level of unemployment rises.\nD The standard of living of the population falls.\n\n Answer: 17" }, { "notes": "", "input": "", "output": "Question: \nThe government of a country used fiscal policy to achieve price stability.\nWhat is another way of saying this?\nA The government increased taxes to achieve low inflation.\nB The government reduced the money supply to achieve low inflation.\nC The government used interest rates to achieve economic growth.\nD The government used restrictions on banks to achieve stable exchange rates.\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nWhich is a description of indirect taxes?\nA They are easy to avoid and deter effort.\nB They are levied on income and cause inflation.\nC They are levied on spending and are regressive.\nD They are progressive and discourage consumption.\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nIn a country, income tax is charged at $50 on an income of $500.\nCompared with this, which of the following would indicate that the income tax scale was\nprogressive?\nA $150 tax on $2000 income\nB $300 tax on $3000 income\nC $450 tax on $4000 income\nD $480 tax on $5000 income\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nWhich of the following is an example of cyclical unemployment?\nA An airline cuts jobs in a world recession.\nB Cleaners lose their jobs as more machines are used.\nC Fishermen sell their boats owing to a reduction in fish stocks.\nD Hotels employ fewer people in the rainy period.\n\n Answer: 17" }, { "notes": "", "input": "", "output": "Question: \nIn constructing a retail price index, what is not used?\nA a base year\nB the prices of a basket of goods\nC the wage rate\nD a weight given to each good\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nTwo industries in Namibia are fishing and tourism. The value of the currency of Namibia fell in\n2001.\nIf there were no other changes what resulted from the fall?\nA Imported goods in Namibian shops became cheaper.\nB The price of Namibia\u2019s fish sold in foreign markets became cheaper.\nC The volume of Namibia\u2019s exports decreased.\nD Tourists were discouraged by higher prices in Namibia.\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nAs a result of two months of bad weather, the demand for hotel rooms decreases and staff are\nnot required.\nWhat type of unemployment is this?\nA cyclical\nB frictional\nC seasonal\nD structural\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nThe most common way of comparing the living standards of two countries is to study each\ncountry\u2019s\nA average weekly working hours.\nB consumer expenditure.\nC GNP per head.\nD national income.\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nThe chart shows the birth rate and death rate in 1983 and 1993 in the European Union (EU) as a\nwhole and in Italy.\nEuropean\nUnion\nItaly\nbirths and deaths\nper 1000 population\nbirth rate\ndeath rate\n8 9\n10\n12\n11\n1983\n1993\n1983\n1993\nWhat does this chart show?\nA The average age of the population rose in Italy but not in the EU as a whole.\nB The birth rate remained above the death rate in the EU as a whole.\nC The size of the population increased in the EU as a whole but not in Italy.\nD People tended to live longer in Italy but not in the EU as a whole.\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nConstruction companies are building new houses on land previously used for farming.\n\nWhat is the opportunity cost to society of this activity?\nA improved living conditions\nB less congestion in city centres\nC more homes for new homeowners\nD some farm output\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nWhat is most likely to cause queues of consumers to appear regularly outside shops in a planned\neconomy?\nA the failure of money to act as a unit of account\nB the inefficient operation of the market system\nC the misallocation of resources by the government\nD the rising opportunity cost of shopping\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nWhat is regarded as a factor of production?\nA capital\nB interest\nC profit\nD rent\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nAlthough people may satisfy their basic needs there is always something more they want.\n\nTo what economic issue does this statement refer?\nA exchange\nB market forces\nC scarcity\nD income distribution\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nWhich source of finance cannot be used by a private company?\nA a bank loan\nB a bank overdraft\nC an issue of shares on the Stock Exchange\nD retained profits\n\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nWhat best describes a multi-national company?\nA a company that is owned by the government\nB a company that has many shareholders\nC a company that trades internationally\nD a company that produces in more than one country\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nKimberly-Clark\nCorporation\nmanufactures\nmany\nproducts,\nincluding\nKleenex\npaper\nhandkerchiefs. It has operations in 43 countries.\n\nWhat is not a reason why a company might decide to have operations in more than one country?\nA availability of raw materials\nB local markets can be served\nC transport is a high proportion of costs\nD trade union pressure\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nThe price of a good is temporarily above the market equilibrium price.\n\nWhat must happen for the market to be brought back to equilibrium?\n\n\nquantity demanded\nquantity supplied\nA rises\nrises\nB rises\nfalls\nC falls\nrises\nD falls\nfalls\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: What is not held constant in calculating a demand schedule?\nA the incomes of consumers\nB the prices of complementary goods\nC the price of the good itself\nD the tastes of consumers\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: In 2002 in Paris there was a decrease in demand for theatre tickets.\n\nWhat might have caused this?\nA a decrease in fares on public transport in Paris\nB a decrease in the number of tourists in Paris\nC an increase in the number of jobs available in Paris\nD an increase in the subsidy given to theatres in Paris\n\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: Why is a surgeon likely to have a higher wage rate than a hospital porter?\nA The surgeon has been in the job a longer time.\nB The surgeon has a longer training period.\nC The surgeon is older.\nD The surgeon is in a trade union.\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: What is an advantage for a worker in part-time rather than full-time employment?\nA a higher wage\nB greater employment protection\nC more opportunity for other activities\nD greater chance of promotion\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: Which factor is likely to cause an increase in people\u2019s savings?\nA an increase in tax rates\nB an increase in the interest rate\nC a reduction in economic uncertainty\nD a reduction in real wages\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: On completing your studies, you decide you want to work in an organisation that is big enough to\ngive you a chance of promotion but where weekend or shift work will not normally be required.\n\nWhich would be the best one to choose?\nA a dental surgery\nB a hairdressing salon\nC an income tax office\nD a newspaper publisher\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: A firm\u2019s average revenue is $10. It sells 2000 units.\n\nWhat is the firm\u2019s total revenue and the price of the product?\n\n\nTotal revenue ($)\nPrice ($)\nA \n10\n\n10\nB \n2 000\n\n200\nC \n20 000\n\n10\nD \n20 000\n\n200\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: 0\n6 150\n7 140\n8 100\n\nWhat will happen if price rises from $5 to $6 per kilo?\nA Total revenue will rise.\nB Demand will rise.\nC Total revenue will fall.\nD Total costs will rise.\n\n\n20 What is a variable cost for a firm?\nA the cost of raw materials\nB the interest payments on loans\nC the rent of the factory\nD the insurance on the factory buildings\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: What advantage does a company risk losing when it expands?\nA access to finance\nB national reputation\nC personal contact\nD skilled labour\n\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: A firm adds up the costs of rent, insurance and initial investment in machinery. It then divides that\ntotal by the number of units produced.\n\nWhat has been calculated?\nA average fixed cost\nB average revenue\nC average total cost\nD average variable cost\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: What might a government decrease if it wished to slow down the rate of growth in an economy?\nA expenditure on defence\nB goods and services (value added) tax\nC interest rates\nD the rate of income tax\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: What is most likely to cause the government to have a budget surplus?\nA a decrease in government spending\nB a decrease in private sector investment\nC an increase in unemployment\nD an increase in the wages of public sector employees\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: Which aim of government policy is most likely to be achieved by an increase in interest rates?\nA economic growth\nB greater equality of income\nC full employment\nD price stability\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: What may a government change when it uses monetary policy?\nA budget deficit\nB minimum lending rate\nC regional assistance\nD rate of income tax\n\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: When is a tax progressive?\nA when some goods have a higher tax than others\nB when the tax is on incomes rather than on goods or services\nC when the rate of tax increases as income increases\nD when the tax is linked to the rate of inflation\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: What would contribute to a fall in the value of the UK pound (\u00a3)?\nA a fall in interest rates in other countries\nB a rise in the number of foreign tourists visiting the UK\nC the removal of import tariffs by the USA\nD the value of UK imports increasing more than the value of UK exports\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: What is meant by the depreciation of a currency?\nA a fall in its external value\nB a fall in its internal value\nC a rise in its external value\nD a rise in its internal value\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: In 2003 Japan experienced a decline in economic output.\n\nWhat might cause a decline in economic output?\nA a decrease in income tax\nB a decrease in sales tax\nC an increase in unemployment\nD an increase in company investment\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: What is the most likely cause of population migration to cities in developing countries?\nA an ageing population\nB higher unemployment rates in cities\nC higher wages in cities\nD higher land values in cities\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: What is likely to be higher in a developing country, such as Kenya, than in a developed country,\nsuch as Switzerland?\nA birth rate\nB GDP per head\nC life expectancy\nD net investment per head\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: What is likely to happen as a developing country becomes more developed?\nA A higher percentage of children will attend school.\nB Infant mortality will rise.\nC Life expectancy will fall.\nD The agricultural sector will increase in importance.\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: Nigeria decides to introduce a policy that limits imports of Japanese cars to 15 % of the total\nmarket.\n\nWhat is this policy called?\n\nA an embargo\nB a quota\nC a subsidy\nD a tariff\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: The central area of a country produces tea for which it has an ideal climate. The coastal area\nproduces coconuts because its climate is different.\n\nAssuming there is no change in market conditions, what will happen if this country subsequently\nproduces only tea in both areas?\nA It will increase its costs of production.\nB It will increase the productivity of its land.\nC It will increase its total income.\nD It will make the best use of its resources.\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: What might encourage international specialisation between countries?\nA free trade\nB inefficiencies in production\nC labour immobility\nD tariffs\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: The following is a headline from a newspaper.\n\nUSA to impose tariffs of 40 % on imported steel\n\nWhat is the most likely result of these tariffs?\nA a fall in the cost of producing cars in the USA\nB a fall in the exports of steel from the USA\nC a rise in employment in the USA\u2019s steel industry\nD a trade deficit for the USA\n\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nConstruction companies are building new houses on land previously used for farming.\n\nWhat is the opportunity cost to society of this activity?\nA improved living conditions\nB less congestion in city centres\nC more homes for new homeowners\nD some farm output\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nIf a planned economy became a mixed economy, which industry would be most likely to remain\nunder government control?\nA agriculture\nB coal mining\nC defence\nD motor car production\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nA boat owner employs a crew to catch fish to sell on the market.\n\nWhich factors of production are involved in this activity?\nA labour, capital and enterprise only\nB land, labour and capital only\nC land, labour and enterprise only\nD land, labour, capital and enterprise\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nWhat is the most likely outcome of increased specialisation in a water bottling plant?\nA higher costs per bottle\nB higher wage rates\nC increased job satisfaction\nD increased output of bottles of water\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nWhat is a characteristic of a public corporation?\nA It issues shares to the general public.\nB It is owned by the government.\nC Its objective is to maximise profits.\nD It is owned by more than twenty shareholders.\n\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nWhat best describes a multi-national company?\nA a company that is owned by the government\nB a company that has many shareholders\nC a company that trades internationally\nD a company that produces in more than one country\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nWhat is usually a function of a trade union?\nA to determine the amount of dividend paid\nB to negotiate wage levels with employers\nC to recommend redundancies\nD to take responsibility for organising sales of companies\u2019 products\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nTea and sugar are complementary goods.\n\nWhat will happen if the price of tea falls, other things being equal?\nA The demand curve for sugar will move to the right.\nB The demand curve for tea will move to the right.\nC The price of sugar will fall.\nD The supply curve of sugar will move to the left.\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nThe price of a good is temporarily above the market equilibrium price.\n\nWhat must happen for the market to be brought back to equilibrium?\n\n\nquantity demanded\nquantity supplied\nA rises\nrises\nB rises\nfalls\nC falls\nrises\nD falls\nfalls\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: What is not held constant in calculating a demand schedule?\nA the incomes of consumers\nB the prices of complementary goods\nC the price of the good itself\nD the tastes of consumers\n\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: As petrol prices increase, demand for petrol remains constant.\n\nWhat does this say about the price elasticity of petrol?\nA The demand is price-elastic.\nB The demand is price-inelastic.\nC The supply is price-elastic.\nD The supply is price-inelastic.\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: The price elasticity of demand for a good is unitary.\nWhat would be the effect of a 1 % fall in its price?\nA to increase total revenue by 0.1 %\nB to leave quantity demanded unchanged\nC to leave total revenue unchanged\nD to reduce quantity demanded by 1 %\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: What is an important influence on price elasticity of demand?\nA average earnings\nB tastes of consumers\nC the cost of living\nD the number of close substitutes\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: Why is a surgeon likely to have a higher wage rate than a hospital porter?\nA The surgeon has been in the job a longer time.\nB The surgeon has a longer training period.\nC The surgeon is older.\nD The surgeon is in a trade union.\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: What is an advantage for a worker in part-time rather than full-time employment?\nA a higher wage\nB greater employment protection\nC more opportunity for other activities\nD greater chance of promotion\n\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: Which factor is likely to cause an increase in people\u2019s savings?\nA an increase in tax rates\nB an increase in the interest rate\nC a reduction in economic uncertainty\nD a reduction in real wages\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: What is likely to cause wages in an occupation to be low?\nA a high level of responsibility\nB high unemployment\nC the need for special skills\nD unpleasant working conditions\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: A firm\u2019s average revenue is $10. It sells 2000 units.\n\nWhat is the firm\u2019s total revenue and the price of the product?\n\n\nTotal revenue ($)\nPrice ($)\nA \n10\n\n10\nB \n2 000\n\n200\nC \n20 000\n\n10\nD \n20 000\n\n200\n\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: 0\n6 150\n7 140\n8 100\n\nWhat will happen if price rises from $5 to $6 per kilo?\nA Total revenue will rise.\nB Demand will rise.\nC Total revenue will fall.\nD Total costs will rise.\n\n\n20 An entrepreneur can use either capital or labour in the production process. The actual\ncombination changes as the prices of the factors alter.\n\nWhen is capital most likely to replace labour?\n\n\nprice of capital\nprice of labour\nA constant\nfalling\nB falling\nrising\nC rising\nconstant\nD falling\nfalling\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: What is happening when a firm is experiencing economies of scale?\nA It has rising long-run average costs.\nB It is operating in the short run.\nC Its fixed costs are less than variable costs.\nD Its output is increasing faster than its inputs.\n\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: When is a firm most likely to undertake capital investment?\nA when it has increasing demand for its product\nB when it has increasing variable cost\nC when it has a decreasing rate of profit\nD when it has decreasing availability of finance\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: What might a government decrease if it wished to slow down the rate of growth in an economy?\nA expenditure on defence\nB goods and services (value added) tax\nC interest rates\nD the rate of income tax\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: Why might policies to promote economic growth result in inflation?\nA They increase competition.\nB They increase saving.\nC They increase spending.\nD They increase unemployment.\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: Which aim of government policy is most likely to be achieved by an increase in interest rates?\nA economic growth\nB greater equality of income\nC full employment\nD price stability\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: Why might a government encourage a monopoly?\nA It can have high average costs.\nB It can compete against foreign firms.\nC It can prevent innovation.\nD It can make excessive profits.\n\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: What is meant by the incidence of a tax?\nA how the revenue raised by the tax is spent\nB how the tax is collected\nC why the tax is imposed\nD where the burden of the tax is finally felt\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: What would contribute to a fall in the value of the UK pound (\u00a3)?\nA a fall in interest rates in other countries\nB a rise in the number of foreign tourists visiting the UK\nC the removal of import tariffs by the USA\nD the value of UK imports increasing more than the value of UK exports\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: What is meant by the depreciation of a currency?\nA a fall in its external value\nB a fall in its internal value\nC a rise in its external value\nD a rise in its internal value\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: What is most likely to lead to inflation?\nA a decrease in consumer spending\nB a decrease in employment in the public sector\nC an increase in the cost of factor inputs\nD an increase in income tax\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: What is the most likely cause of population migration to cities in developing countries?\nA an ageing population\nB higher unemployment rates in cities\nC higher wages in cities\nD higher land values in cities\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: What is the most likely cause of a fall in the population growth of a developing country?\nA a decrease in the birth rate\nB a decrease in emigration\nC a decrease in immigration\nD a decrease in the standard of living\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: What is most likely to be found in a developing country?\nA a large proportion of professional people\nB a large proportion of income spent on entertainment\nC a small proportion of very old people\nD a small average family size\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: Assuming nothing else is changed, what will be the effect if a country imposes tariffs?\nA increased import prices\nB increased export prices\nC reduced government revenue\nD reduced home production\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: The central area of a country produces tea for which it has an ideal climate. The coastal area\nproduces coconuts because its climate is different.\n\nAssuming there is no change in market conditions, what will happen if this country subsequently\nproduces only tea in both areas?\nA It will increase its costs of production.\nB It will increase the productivity of its land.\nC It will increase its total income.\nD It will make the best use of its resources.\n\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: More people decide to travel by bus and train rather than by car because government subsidies\nresult in reduced fares.\n\nWhat will be the effect on the private benefit for passengers and external benefit?\n\n\nprivate benefit for\npassengers\nexternal benefit\nA falls\nfalls\nB falls\nrises\nC rises\nfalls\nD rises\nrises\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: Which of the effects of economic development would be classed as an external cost?\n\nA higher wages\nB increased pollution\nC increased production\nD more advanced technology\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nWhat is an example of the factor of production \u2018capital\u2019?\nA a truck\nB a truck driver\nC a truck driver\u2019s savings\nD a truck driver\u2019s wage\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nWhat makes specialisation easier?\nA the imposition of taxation\nB the protection of trade\nC the system of barter\nD the use of money\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nIn a market economy, who determines the allocation of resources?\nA central authorities only\nB firms only\nC consumers and firms only\nD central authorities and firms only\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nA government is faced with the choice of raising taxation or cutting public spending.\n\nOf what is this an example?\nA conservation of resources\nB monetary policy\nC opportunity cost\nD substitution of factors\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nEach country of Southern Africa has a mixed economy.\n\nWhich statement about a mixed economy is correct?\nA The government employs most primary sector workers.\nB The government owns all major secondary sector industries.\nC The government owns the transport network.\nD The government provides public and merit goods.\n\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nWhen will a trade union be most effective in pursuing its members' interests?\nA The economy is in recession with rising unemployment.\nB The employers have few orders for the product.\nC The government passes a law to increase competition in the labour market.\nD The members' wages make up a small part of total costs.\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nWhat is the main advantage that a public limited company has over a private limited company?\nA It operates in the public sector.\nB Its shares can be sold on the stock exchange.\nC It is managed by a director.\nD Its shareholders have limited liability.\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nWhat is the function of a stock exchange?\nA It enables shareholders to sell their shares.\nB It fixes fair prices for shares.\nC It promises to buy unsold shares.\nD It sets the number of shares.\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nA French company employs French people, is located only in France, sells shares on the stock\nexchange but uses other firms to transport its products to other countries.\n\nWhat type of company is this?\nA a co-operative\nB a private company\nC a public company\nD a multi-national\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: In many countries, the price of personal computers has fallen while the quantity sold has risen.\n\nWhat is the most likely reason for these changes?\nA Advertising campaigns for computers increased.\nB Computer production technology improved.\nC Computer software became cheaper.\nD Real incomes rose.\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: Which group is likely to save the largest proportion of its income?\nA employed workers\nB retired people\nC school students\nD unemployed workers\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: What is not included in a person\u2019s stock of wealth?\nA a gold watch\nB annual income\nC an oil painting\nD company shares\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: Which asset is the most illiquid?\nA cash\nB money order\nC government bonds\nD a house\n\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: Which service is most likely to be supplied by a small business?\nA banking\nB dental treatment\nC heart surgery\nD rail travel\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: A British firm, Dyson, moved production of its vacuum cleaners from the UK to Malaysia.\n\nWhy might it have made this change?\nA average costs would fall\nB average revenue would rise\nC market share would fall\nD transport costs would rise\n\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: What is a fixed cost of production?\nA the commission paid to sales staff\nB the cost of using the telephone\nC the interest paid on a bank loan\nD the money spent on repairs\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: What is not equal to the average revenue?\nA the price of each unit\nB the profit from each unit\nC the revenue from each unit\nD the total revenue divided by output\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: The information below refers to an economy for a financial year.\n\nGovernment expenditure\n= $2 866 million\nGovernment revenue\n= $1 940 million\n\nWhat was the budget balance of the Government in that year?\nA $926 million in deficit\nB $4 806 million in deficit\nC $926 million in surplus\nD $4 806 million in surplus\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: A local tax will usually be\nA raised by a central government.\nB used to provide a national road network.\nC different from region to region.\nD raised by using import tariffs.\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: A government establishes a body to control monopolies and mergers.\n\nWho is this intended to protect?\nA consumers\nB foreign investors\nC multi-nationals\nD the government\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: Frictional unemployment occurs when\nA workers are temporarily between jobs.\nB there is a general fall in total demand.\nC certain major industries go into economic decline.\nD new technology reduces the need for labour.\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: What is a reason for collecting national income statistics?\nA to calculate population changes\nB to compare standards of living\nC to fix exchange rates\nD to keep inflation low\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nNepal\n93\n2 5\nUK\n2 42\n56\n\nWhat can be concluded from the table?\nA Iran has fewer people working in manufacturing than the UK.\nB Nepal is a developed economy.\nC Services are more developed in Iran than Nepal.\nD The UK is dependent on agriculture.\n\n\n29 In rural areas in developing countries women often do unpaid work on traditional activities.\n\nWhy might this mean that the GDP is not a good measure of the standard of living in those\ncountries?\nA The GDP does not include international trade.\nB The GDP only refers to companies in urban areas.\nC The work is not counted in GDP statistics.\nD The work is not economically important.\n\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: Two industries in Namibia are fishing and tourism. The value of the currency of Namibia fell in\n2001.\n\nIf there were no other changes, what resulted from the fall?\nA Imported goods in Namibian shops became cheaper.\nB The price of Namibia\u2019s fish sold in foreign markets became cheaper.\nC The volume of Namibia\u2019s exports decreased.\nD Tourists were discouraged by higher prices in Namibia.\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: Which country is likely to have the lowest standard of living?\n\n\nbirth rate\ndeath rate\nlife\nexpectancy\ninfant\nmortality\nA 25\n10\n57\n24\nB 43\n31\n40\n42\nC 25\n5 72\n22\nD 36\n14\n48\n56\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: In 2005, world population had grown to 6.5 billion with an increase of more than 4 billion since\n1950.\n\nWhat is most likely to have been the cause of this?\nA an increase in the death rate in developed countries\nB an increase in the birth rate in developing countries\nC an increase in migration from developing to developed countries\nD an increase in the death rate in developing countries\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: At the G8 Economic Summit in 2005, it was decided to cancel much of the debt which African\ncountries owed to European and North American countries.\n\nThis will have the same effect as a transfer of resources from\nA developed countries to developing countries.\nB developing countries to developed countries.\nC market economies to planned economies.\nD planned economies to market economies.\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: A government decides to reduce the size of the quota on a good.\n\nWhat is likely to happen?\nA The balance of trade will worsen.\nB The good will become cheaper.\nC The government\u2019s revenue will decline.\nD There will be less of the good imported.\n\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: Which combination would offer increased trade protection for an economy?\n\n\ndomestic subsidies\ntariffs\nA bigger\nhigher\nB bigger\nlower\nC smaller\nhigher\nD smaller\nlower\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: Why may it be better to increase public expenditure while reducing private expenditure?\nA Goods and services which the market ignores can be provided.\nB Government officials are likely to be more careful spending money than private individuals.\nC The profit motive makes government departments more efficient than private firms.\nD The government is the best judge of the satisfaction gained from goods and services.\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: Zambia is the fifth largest producer and the second largest exporter of copper in the world.\nCopper brings Zambia 85 % of all the money Zambia earns in trade.\n\nWhat can be concluded from this?\nA Copper prices are high because Zambia is a large producer.\nB Manufacturing production in Zambia is very diversified.\nC Zambia can influence the world price of copper.\nD Zambia produces copper more cheaply than all other countries.\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: What will result if Europe reduces trade barriers to increase imports of clothing and food from\nAsia and Africa?\nA greater choice for European consumers\nB increased income for European producers\nC lower unemployment in the European clothing industry\nD slower economic growth in Asia and Africa\n\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \n$2 bn is invested in developing a country\u2019s natural resources and infrastructure.\n\nWhich two factors of production does this refer to directly?\nA capital and labour\nB capital and land\nC enterprise and land\nD labour and land\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nWhat makes specialisation easier?\nA the imposition of taxation\nB the protection of trade\nC the system of barter\nD the use of money\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nA free market economy is more likely than a planned economy to encourage development\nbecause\nA equality of income is encouraged.\nB factors of production would be employed efficiently.\nC government intervention uses taxes and subsidies.\nD social costs are taken into consideration.\n\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nAn economy is producing at X.\n\nfood\nmachines\n100\n0 75\n150\n200\nX Y\n\n\nWhat is the opportunity cost of choosing to produce at Y instead of X?\nA 25 machines\nB 50 units of food\nC 75 machines\nD 150 units of food\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nEach country of Southern Africa has a mixed economy.\n\nWhich statement about a mixed economy is correct?\nA The government employs most primary sector workers.\nB The government owns all major secondary sector industries.\nC The government owns the transport network.\nD The government provides public and merit goods.\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nWhen will a trade union be most effective in pursuing its members' interests?\nA The economy is in recession with rising unemployment.\nB The employers have few orders for the product.\nC The government passes a law to increase competition in the labour market.\nD The members' wages make up a small part of total costs.\n\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nWhat is the function of a stock exchange?\nA It enables shareholders to sell their shares.\nB It fixes fair prices for shares.\nC It promises to buy unsold shares.\nD It sets the number of shares.\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nA French company employs French people, is located only in France, sells shares on the stock\nexchange but uses other firms to transport its products to other countries.\n\nWhat type of company is this?\nA a co-operative\nB a private company\nC a public company\nD a multi-national\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: A firm produces a good with a price elasticity of demand greater than 1.\n\nWhat must the firm experience if there is a fall in the price of this good?\nA a decrease in costs\nB a decrease in sales\nC an increase in revenue\nD an increase in profits\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: Which group is likely to save the largest proportion of its income?\nA employed workers\nB retired people\nC school students\nD unemployed workers\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: What is not included in a person\u2019s stock of wealth?\nA a gold watch\nB annual income\nC an oil painting\nD company shares\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: What might cause the wages of bus drivers to rise?\nA Their productivity falls.\nB The number of bus routes falls.\nC The number of people making bus journeys falls.\nD The supply of bus drivers falls.\n\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: What will lead to an increase in spending?\nA an increase in the rate of unemployment\nB a reduction in the rate of interest\nC a reduction in expenditure by firms on advertising\nD an increase in the rate of income tax\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: A British firm, Dyson, moved production of its vacuum cleaners from the UK to Malaysia.\n\nWhy might it have made this change?\nA average costs would fall\nB average revenue would rise\nC market share would fall\nD transport costs would rise\n\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: What is a fixed cost of production?\nA the commission paid to sales staff\nB the cost of using the telephone\nC the interest paid on a bank loan\nD the money spent on repairs\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: What is not equal to the average revenue?\nA the price of each unit\nB the profit from each unit\nC the revenue from each unit\nD the total revenue divided by output\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: What is most likely to happen if a regressive tax replaces a progressive tax?\nA the amount of tax paid by richer people increases\nB incomes before tax become less equal\nC the majority of people continue to pay the same tax\nD the amount of tax paid by poorer people increases\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: A government decides to reduce income tax.\n\nWhich aims of government policy would this help to achieve?\nA a smaller balance of payments deficit and lower inflation\nB a smaller balance of payments deficit and more economic growth\nC lower unemployment and lower inflation\nD lower unemployment and more economic growth\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: Why might a government discourage monopolies?\nA They can achieve low average costs.\nB They can compete against foreign firms.\nC They can introduce new technology.\nD They can make large profits.\n\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: Which type of unemployment is generally regarded by economists as the least serious for the\neconomy?\nA cyclical\nB frictional\nC regional\nD structural\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: The citizens most likely to benefit in a period of rapid inflation are those who\nA are receiving fixed state benefits.\nB earn fixed incomes.\nC have lent money at a fixed rate of interest.\nD have borrowed money at a fixed rate of interest.\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nNepal\n93\n2 5\nUK\n2 42\n56\n\nWhat can be concluded from the table?\nA Iran has fewer people working in manufacturing than the UK.\nB Nepal is a developed economy.\nC Services are more developed in Iran than Nepal.\nD The UK is dependent on the primary sector.\n\n\n29 In rural areas in developing countries women often do unpaid work on traditional activities.\n\nWhy might this mean that the GDP is not a good measure of the standard of living in those\ncountries?\nA The GDP does not include international trade.\nB The GDP only refers to companies in urban areas.\nC The work is not counted in GDP statistics.\nD The work is not economically important.\n\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: Two industries in Namibia are fishing and tourism. The value of the currency of Namibia fell in\n2001.\n\nIf there were no other changes, what resulted from the fall?\nA Imported goods in Namibian shops became cheaper.\nB The price of Namibia\u2019s fish sold in foreign markets became cheaper.\nC The volume of Namibia\u2019s exports decreased.\nD Tourists were discouraged by higher prices in Namibia.\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: What is likely if the proportion of retired people in a country increases?\nA a reduction in income from direct taxation\nB a reduction in the dependency ratio\nC an increase in the total number of jobs available\nD a reduction in spending on medical treatment\n\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: Which country is likely to have the lowest standard of living?\n\n\nbirth rate\ndeath rate\nlife\nexpectancy\ninfant\nmortality\nA 25\n10\n57\n24\nB 43\n31\n40\n42\nC 25\n5 72\n22\nD 36\n14\n48\n56\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: In 2005, world population had grown to 6.5 billion with an increase of more than 4 billion since\n1950.\n\nWhat is most likely to have been the cause of this?\nA an increase in the death rate in developed countries\nB an increase in the birth rate in developing countries\nC an increase in migration from developing to developed countries\nD an increase in the death rate in developing countries\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: At the G8 Economic Summit in 2005, it was decided to cancel much of the debt which African\ncountries owed to European and North American countries.\n\nThis will have the same effect as a transfer of resources from\nA developed countries to developing countries.\nB developing countries to developed countries.\nC market economies to planned economies.\nD planned economies to market economies.\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: A government decides to reduce the size of the quota on a good.\n\nWhat is likely to happen?\nA The balance of trade will worsen.\nB The good will become cheaper.\nC The government\u2019s revenue will decline.\nD There will be less of the good imported.\n\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nWhat can happen in a planned economy that does not happen in a market economy?\nA The allocation of resources can take account of the total effects on society.\nB There can be full employment of factors of production.\nC There can be inflation.\nD There can be international trade.\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nWhich of the following is a factor of production?\nA the payment of interest on a bank loan\nB the profit declared by a company in its annual report\nC the skill of the managers of a business\nD the taxes paid to the government\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nIn a mixed economy, resources are used as a result of\nA the decisions of consumers only.\nB the decisions of firms only.\nC the decisions of consumers and firms.\nD the decisions of consumers, firms and government.\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nA farmer decides to use a more fertile field. As a result he is able to produce the same output as\nbefore but with fewer workers and less equipment.\n\nThis is a substitution in which\nA capital replaces labour and land.\nB labour replaces capital and land.\nC land replaces capital and enterprise.\nD land replaces capital and labour.\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nWhich of the following benefits does a stock exchange provide?\nA a source of finance for private limited companies\nB a safeguard against the risk of loss\nC an opportunity to sell shares quickly\nD an opportunity to purchase foreign currency\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nWhat is not a function of a trade union?\nA to act as a pressure group to change labour laws\nB to negotiate with employers over conditions of work\nC to promote the sales of products made by its members\nD to protect the living standards of its members\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nA company is described as a multinational if it\nA employs workers of several nationalities.\nB exports goods to several countries.\nC has production units in several countries.\nD has shareholders from several countries.\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: Due to good weather, there is a surplus in the market for an agricultural product.\n\nWhich change would cause the market to return to equilibrium?\nA a decrease in demand\nB a fall in price\nC an increase in supply\nD a rise in price\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: Which pair is an example of products in complementary (joint) demand?\nA bananas and oranges\nB cars and petrol\nC tea and coffee\nD wheat and straw\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: What combination of events might cause a rise in the willingness and the ability of consumers to\nbuy a product?\n\n\nprice of a substitute\nproduct\ntax rates\nA decrease\ndecrease\nB decrease\nincrease\nC increase\nincrease\nD increase\ndecrease\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: What is a firm\u2019s aim when it advertises its product?\nA to shift its demand curve to the left\nB to shift its supply curve to the left\nC to shift its demand curve to the right\nD to shift its supply curve to the right\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: What would an individual be doing to be described as a worker in the secondary sector?\nA working in a firm that grows fruit trees and plants\nB working in a firm that produces machines for other firms\nC working in a government passport office\nD working in the reception area of a hospital\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: What is the most likely reason for a firm to offer higher wages to recruit more staff?\nA falling incomes\nB falling output\nC falling prices\nD falling unemployment\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: What is likely to be found when comparing high income earners with low income earners?\nA High income earners pay a lower proportion of their income in direct tax.\nB High income earners spend a lower proportion of their income on food.\nC High income earners spend a lower proportion of their income on foreign travel.\nD High income earners save a lower proportion of their income.\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: What would encourage a rise in spending but not a rise in saving?\nA easier credit facilities\nB more people working\nC rising interest rates\nD rising standards of living\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: An Economics student made the following statements about costs of production.\n\nAverage costs remain the same at all levels of output.\nFixed costs can exist when there is no output.\nTotal costs can include both fixed and variable costs.\nTotal variable costs fall as output increases.\n\nHow many of these statements are correct?\nA 1\nB 2\nC 3\nD 4\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: Which statement explains why cars are often repaired by small garages?\nA bulk buying of spare parts can take place\nB car-repair jobs are varied\nC entry to the car-repair industry is restricted\nD expensive machinery is required\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: A Japanese company which has spare capacity has agreed to refine 20 000 barrels of oil a day\nfor a Chinese company.\n\nWhat is likely to happen in the Japanese firm to fixed cost, to variable cost and to total cost?\n\n\nfixed cost\nvariable cost\ntotal cost\nA rise\nrise\nrise\nB rise\nfall\nstay the same\nC stay the same\nrise\nrise\nD stay the same\nfall\nfall\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: As output increases, what happens to the average fixed cost of production?\nA It falls continuously.\nB It falls and then rises.\nC It remains constant.\nD It rises and then falls.\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \u2018The pound sterling made a dramatic recovery in the world's currency markets yesterday.\u2019\n\nTo what does this statement refer?\nA exchange rate\nB growth rate\nC interest rate\nD tax rate\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: What might a government increase if it wished to raise the growth rate of an economy?\nA expenditure on road building\nB goods and services tax (value added tax)\nC the rate of income tax\nD the rate of interest\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: What is meant by a regressive indirect tax?\nA a tax on income that falls more heavily on the poor\nB a tax on income that falls more heavily on the rich\nC a tax on spending that falls more heavily on the poor\nD a tax on spending that falls more heavily on the rich\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: What is likely to be an advantage of economic growth?\nA The country\u2019s resources will be depleted.\nB The price level will increase.\nC The rate of employment will fall.\nD The standard of living will increase.\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: A government decreased the tax on all goods produced in a country.\n\nWhat is the most likely result of this?\nA a decrease in imports\nB a decrease in industrial production\nC a decrease in real incomes\nD a deterioration in the balance of trade in goods\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: In 2003, interest rates in Southern Africa were reduced.\n\nWhat might have happened as a result?\nA an increase in investment\nB an increase in unemployment\nC a reduction in economic growth\nD a reduction in government spending\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: Which of the following is most likely to be used as a measure of living standards?\nA the balance of trade\nB the consumer price index\nC the government\u2019s budget position\nD the real GDP per head\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: In some developing countries, such as Rwanda, a large percentage of the population is involved\nin subsistence farming.\n\nWhat can be concluded from this?\nA In some developing countries, the natural resources are used efficiently.\nB Production in some developing countries depends upon skilled labour.\nC Production in some developing countries is not likely to be capital intensive.\nD Some developing countries do not import food because each family is self-sufficient.\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: What is characteristic of a developed economy?\nA a high infant mortality rate\nB a high literacy rate\nC a low GDP per capita\nD a low life expectancy\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: In 2001 a government enquiry approved a major new air terminal for London, which would create\nmany new jobs. However, it would also cause extra noise and air pollution. Compensation would\nhave to be paid to some people whose houses would be demolished.\n\nWhat is not involved in this exploitation of resources?\nA conflicts of interest\nB free market economy\nC income creation\nD opportunity cost\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: Some countries protect their economies through barriers to free trade.\n\nWhat would be the result in such countries of this protection?\nA Competition will be reduced.\nB Consumer choice will increase.\nC Prices will fall.\nD Unemployment will rise.\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: What is an advantage if a region specialises in a narrow range of products?\nA Other regions will become over-dependent on the region.\nB Scarce resources are used more efficiently.\nC The level of production in the region will decrease.\nD The region\u2019s system of transport is improved.\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: What is the main reason why the government, rather than the private sector, builds and runs\nhospitals?\nA Hospitals are expensive to build.\nB The government has enough tax revenue to pay for hospitals.\nC The government needs to be sure that the doctors are well-trained.\nD The whole country can benefit from the provision of good health facilities.\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nWhat can happen in a planned economy that does not happen in a market economy?\nA The allocation of resources can take account of the total effects on society.\nB There can be full employment of factors of production.\nC There can be inflation.\nD There can be international trade.\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nWhich of the following is a factor of production?\nA the payment of interest on a bank loan\nB the profit declared by a company in its annual report\nC the skill of the managers of a business\nD the taxes paid to the government\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nIn a mixed economy, resources are used as a result of\nA the decisions of consumers only.\nB the decisions of firms only.\nC the decisions of consumers and firms.\nD the decisions of consumers, firms and government.\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nHong Kong lacks natural resources. Its best asset is its people.\n\nWhat can be concluded about Hong Kong\u2019s factors of production?\n\n\nwell supplied\npoorly supplied\nA capital\nenterprise\nB enterprise\nlabour\nC labour\nland\nD land\ncapital\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nAn Italian-owned tour operator needs its staff in Rome to be able to speak a number of languages\nso it employs people from different countries. It also uses other firms in different countries to\nprovide tour guides and coach drivers. It is part of an organisation that has shares issued on the\nstock exchange.\n\nWhich type of company is this?\nA a co-operative\nB a private company\nC a public company\nD a multi-national\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nA commercial bank is appointed to act as a country\u2019s central bank.\n\nWhat new function would it now have?\nA controlling monetary policy\nB dealing in foreign exchange\nC ensuring security for loans\nD holding liquid assets\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nWhat is not a function of a trade union?\nA to act as a pressure group to change labour laws\nB to negotiate with employers over conditions of work\nC to promote the sales of products made by its members\nD to protect the living standards of its members\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nWhat is always true about multi-national companies?\nA They employ more workers abroad than in their home market.\nB They operate in manufacturing industry.\nC They originate from developed countries.\nD They own production facilities abroad.\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: Due to good weather, there is a surplus in the market for an agricultural product.\n\nWhich change would cause the market to return to equilibrium?\nA a decrease in demand\nB a fall in price\nC an increase in supply\nD a rise in price\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: What combination of events might cause a rise in the willingness and the ability of consumers to\nbuy a product?\n\n\nprice of a substitute\nproduct\ntax rates\nA decrease\ndecrease\nB decrease\nincrease\nC increase\nincrease\nD increase\ndecrease\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: What could cause the demand for a product to become more price-elastic?\nA a smaller proportion of income being spent on the product\nB more substitutes coming onto the market\nC the product becoming more of a necessity\nD the product falling in price\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: When the price of a product rises from $10 to $15, the demand falls from 5000 to 4000 units.\n\nWhat is the value of the price elasticity of demand for the product?\nA 0.2\nB 0.4\nC 1.5\nD 2.5\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: What would an individual be doing to be described as a worker in the secondary sector?\nA working in a firm that grows fruit trees and plants\nB working in a firm that produces machines for other firms\nC working in a government passport office\nD working in the reception area of a hospital\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: What is the most likely reason for a firm to offer higher wages to recruit more staff?\nA falling incomes\nB falling output\nC falling prices\nD falling unemployment\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: In India, there is a considerable gap between the incomes of the rich and the incomes of the\npoor.\n\nIn 2006, there were 6 million rich households with an annual income above 215 000 rupees and\n50 million poor households with an annual income less than 22 000 rupees.\n\nWhat is most likely to be true about spending?\n\n\nthe group spending most money\non food per household\nthe group spending the highest\nproportion of its income on food\nA the rich\nthe rich\nB the rich\nthe poor\nC the poor\nthe poor\nD the poor\nthe rich\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: Why would people use their savings to buy shares on a stock exchange?\nA to allow easy access to their income\nB to earn a fixed income\nC to keep their money in a safe place\nD to make a capital gain\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: An Economics student made the following statements about costs of production.\n\nAverage costs remain the same at all levels of output.\nFixed costs can exist when there is no output.\nTotal costs can include both fixed and variable costs.\nTotal variable costs fall as output increases.\n\nHow many of these statements are correct?\nA 1\nB 2\nC 3\nD 4\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: Which statement explains why cars are often repaired by small garages?\nA bulk buying of spare parts can take place\nB car-repair jobs are varied\nC entry to the car-repair industry is restricted\nD expensive machinery is required\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: A Japanese company which has spare capacity has agreed to refine 20 000 barrels of oil a day\nfor a Chinese company.\n\nWhat is likely to happen in the Japanese firm to fixed cost, to variable cost and to total cost?\n\n\nfixed cost\nvariable cost\ntotal cost\nA rise\nrise\nrise\nB rise\nfall\nstay the same\nC stay the same\nrise\nrise\nD stay the same\nfall\nfall\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: A firm sells its products for $10 each. It produces 100 units. Its average variable cost is $5 and its\naverage fixed cost is $2.\n\nHow much profit does the firm make from selling 100 units?\nA $1000\nB $700\nC $500\nD $300\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: In 2006, the Indian company, Ratnagin Gas and Power bought another Indian power company,\nDabhol Power.\n\n\nWhat type of integration is this?\nA conglomerate\nB horizontal\nC vertical backwards\nD vertical forwards\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: What is not a main economic government objective?\nA a balance of payments deficit\nB economic growth\nC full employment\nD price stability\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: What might a government increase if it wished to raise the growth rate of an economy?\nA expenditure on road building\nB goods and services tax (value added tax)\nC the rate of income tax\nD the rate of interest\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: What is meant by a regressive indirect tax?\nA a tax on income that falls more heavily on the poor\nB a tax on income that falls more heavily on the rich\nC a tax on spending that falls more heavily on the poor\nD a tax on spending that falls more heavily on the rich\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: What is likely to be an advantage of economic growth?\nA The country\u2019s resources will be depleted.\nB The price level will increase.\nC The rate of employment will fall.\nD The standard of living will increase.\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: A government decreased the tax on all goods produced in the country.\n\nWhat is the most likely result of this?\nA a decrease in imports\nB a decrease in industrial production\nC a decrease in real incomes\nD a deterioration in the balance of trade in goods\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: It was reported that the economic recovery in the first half of 2003 was poor.\n\nWhat factor might have explained this?\nA a rise in consumer spending\nB a rise in investment\nC a rise in oil prices\nD a rise in world share prices\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: Which of the following is most likely to be used as a measure of living standards?\nA the balance of trade\nB the consumer price index\nC the government\u2019s budget position\nD the real GDP per head\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: What combination of events is most likely to cause an ageing population?\n\n\nbirth rate\ndeath rate\nA fall\nfall\nB fall\nrise\nC rise\nrise\nD rise\nfall\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: Zambia is sometimes spoken of as a developing country.\n\nWhat would be most likely to confirm that a country is developing rather than developed?\nA a balance of payments deficit\nB a high proportion of the population in subsistence agriculture\nC a lack of natural resources\nD a large population\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: Why might the government of a developing economy welcome large-scale cutting of its limited\nhardwood forests for export by a multi-national company?\nA It allows profits to be exported.\nB It conserves scarce resources.\nC It ensures long-term future growth in living standards.\nD It increases employment.\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: What is not likely to be a barrier to international trade?\nA distance\nB exchange rates\nC language\nD specialisation\n\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nWhat is the basic economic problem facing all societies?\nA how to achieve price stability\nB how to keep employment levels high\nC the extent to which incomes should be redistributed\nD what will be produced, how and for whom\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nA major airline needs a range of people and equipment. These can be divided into factors of\nproduction.\n\nWhich is allocated to its correct factor of production?\n\n\npeople or equipment\nfactor of production\nA aircraft\ncapital\nB computer network\nland\nC pilots\nenterprise\nD shareholders\nlabour\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nCommercial companies are cutting down tropical rainforests for hardwood timber.\n\nWhat is the opportunity cost to society of this activity?\nA tax revenue from the sale of the timber\nB the environment that is destroyed\nC the products made from the timber\nD the profits of the companies\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nWho is definitely employed in the primary sector?\nA a person in a firm producing goods for other firms to use\nB a person in a firm engaged in agricultural production\nC a person in an organisation which first deals with any imports into the country\nD a person in the head office of a company\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nWhich argument can be used in favour of the market economy?\nA It enables consumers to show their preferences for goods.\nB It ensures that all capital resources are used.\nC It guarantees full employment.\nD It leads to an equal distribution of wealth.\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nThe market for a good was in equilibrium. A change occurred which resulted in a new equilibrium\nwith a higher price for the good and a lower quantity traded.\n\nWhat change would have caused this?\nA The demand curve moved to the left.\nB The demand curve moved to the right.\nC The supply curve moved to the left.\nD The supply curve moved to the right.\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nIt was reported in 2002 that South Africa, a mixed economy, would face sharp increases in air\nand water pollution unless action was taken to develop environmentally friendly policies for its\ncitizens.\n\nWhy is a mixed economy thought to be a satisfactory means of achieving environmentally friendly\ndevelopment?\nA because all development is paid for by the government\nB because it allows external costs to be considered\nC because it ensures development at lowest cost\nD because it is the most productive system\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nIt was reported that a company producing designer clothes had increased its revenue by 20 % at\na time when it decreased its prices.\n\nWhat does this suggest about the demand for these goods at that time?\nA It was perfectly price elastic.\nB It was perfectly price inelastic.\nC It was price elastic.\nD It was price inelastic.\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nWhich costs will be reduced if a factory decreases the amount of pollution it causes to the\nenvironment?\nA average costs\nB external costs\nC fixed costs\nD variable costs\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: What function does a central bank provide for the general public?\nA accepting deposits\nB issuing banknotes\nC making loans\nD providing overdrafts\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: A person is keen to repay a large debt owed on his credit card.\n\nWhat is likely to cause that person to reduce the credit card repayment and spend more from his\nweekly wage?\nA an increase in interest rates\nB an increase in the price of essential products\nC an increase in the range of products available\nD an increase in weekly earnings\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: Why are farm workers likely to be paid a lower wage rate than workers in manufacturing?\nA Farm workers are more likely to be in a trade union.\nB Farm workers are more likely to have a shorter working life.\nC Farm workers are more likely to have poorer working conditions.\nD Farm workers are more likely to produce goods with a lower value.\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: Three doctors decide to work together in one health centre.\n\nWhat form of business organisation are they most likely to choose?\nA a partnership\nB a private company\nC a public company\nD a public corporation\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: How does a firm guarantee that it makes the maximum profit?\nA by maximising the difference between its total revenue and total cost\nB by maximising the number of goods that it sells\nC by minimising the amount of goods that it keeps in stock\nD by minimising the difference between average revenue and average cost\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: Some travellers complain about the disturbance caused when other people use their mobile (cell)\nphones. As a result, a UK train operator announces that it will buy some new trains that will have\na device fitted to prevent the use of mobile (cell) phones.\n\nWhat will definitely happen to the train operator?\nA Its average revenue will decrease.\nB Its total revenue will increase.\nC Its fixed cost will increase.\nD Its total cost will decrease.\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: Which is a diseconomy of scale?\nA Bulk buying reduces costs.\nB Communications deteriorate.\nC Employees are more motivated.\nD Technological improvements take place.\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: What is likely to increase with economic growth?\nA cyclical unemployment\nB income per head\nC the budget deficit\nD the conservation of natural resources\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: A government decreased the tax on all goods imported into the country.\n\nWhat is the most likely result of this?\nA a decrease in domestic production\nB an increase in economic growth\nC an increase in exports\nD an improvement in the balance of trade in goods\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: Changes in demand mean that the government of Bangladesh hopes to switch some production\nfrom clothes made by low-paid, unskilled workers to medicines produced by highly-trained\ntechnicians.\n\nWhat policies would enable Bangladesh to achieve this switch in employment and production?\nA demolish clothes factories and decrease imports\nB encourage immigration of foreign labour and introduce tariffs on clothing\nC invest in education and purchase new machines\nD substitute labour for machines and encourage emigration of workers from Bangladesh\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: What is not an important step in the construction of an accurate Retail Price Index?\nA choosing a base year with normal economic conditions\nB comparing price rises with those of international competitors\nC sampling prices from a wide range of retail outlets\nD selecting a typical basket of goods consumed by the average citizen\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: What might cause a decline in economic output?\n\nA a decrease in income tax\nB a decrease in sales tax\nC an increase in company investment\nD an increase in unemployment\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: A closed economy has both a private sector and a public sector.\n\nGross Domestic Product (GDP) consists of total consumer expenditure plus gross investment\nplus\nA the value of exports.\nB the value of exports minus the value of imports.\nC total government expenditure.\nD total government expenditure minus total taxation.\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: What is most likely to cause an immediate decrease in the size of the working population?\nA a fall in the average size of families\nB a fall in the birth rate\nC a reduction in the age of retirement\nD an increase in net immigration\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: What is least likely to be found in a typical developing country?\nA Ill-health affects many of the population.\nB Many workers are highly skilled.\nC Production is labour-intensive.\nD There is an unequal distribution of income and wealth.\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: Which statement about economic development is correct?\nA A country needs more than a high GDP to be considered developed.\nB A country which has rich reserves of raw materials is classed as developed.\nC A country will have no people living in poverty when it is developed.\nD A country with a trade surplus is considered to be developed.\n\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nWhich terms summarise the nature of the economic problem?\nA finite resources and limited wants\nB finite resources and unlimited wants\nC infinite resources and limited wants\nD infinite resources and unlimited wants\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nWhich statement about the factors of production is correct?\nA A river from which a company draws water is called land.\nB Raising finance for a company is called capital.\nC Supervisors employed in a company are called enterprise.\nD The owner of a company is called labour.\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nWhich economic change would increase the problem of scarcity?\nA a decrease in fish stocks\nB a discovery of a new oil field\nC an increase in labour productivity\nD a reduction in waste\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nThe government of a country with a rapidly increasing population decides to switch resources\nfrom investment to increased subsidies to farmers.\n\nWhat is the opportunity cost of this decision?\nA the profit earned by farmers\nB the rent of the land on which food is grown\nC the reduction in investment\nD the wages of the farm workers\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nWhat is a function of a commercial bank?\nA acting as the lender of last resort\nB deciding what is a legal tender\nC determining monetary policy\nD providing overdrafts\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: A person is most likely to save more when there is an increase in a country\u2019s\nA exchange rate.\nB inflation rate.\nC interest rates.\nD money supply.\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: One of the functions of money is to act as a measure of value.\n\nWhat does this mean?\nA Money allows people to borrow and lend.\nB Money allows people to save their surplus income.\nC Money is used to buy goods and services.\nD Money is used to compare the worth of different goods and services.\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: What is a function of a trade union?\nA to negotiate workers\u2019 contracts\nB to promote workers to more responsible jobs\nC to recruit workers for the firm\nD to supervise the workers in the firm\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: What is an example of occupational mobility of labour?\nA A Japanese car manufacturer locates in England.\nB A nurse returns to work after her children have grown up.\nC A student takes an evening job in a restaurant.\nD Farm workers retrain as call-centre workers.\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: In August 2008, Infosys, an Indian information technology company, bought Axon, a UK\ninformation technology company.\n\nWhich type of integration is this?\nA conglomerate\nB horizontal\nC vertical backwards\nD vertical forwards\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: What is correct about a monopoly?\nA It may benefit from economies of scale.\nB It must be privately not state owned.\nC Its costs are always higher than those of a firm in perfect competition.\nD It sells only one product.\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: Barilla, an Italian company, is the world\u2019s largest pasta maker. It also produces bread.\n\nIn 2006 its bread production contributed $1.5 billion (bn) to its total revenue of $5.1 bn.\nOverall profit was $0.6 bn.\n\nWhat was the total cost to Barilla of producing pasta and bread in 2006?\nA $2.1 bn\nB $3.0 bn\nC $3.6 bn\nD $4.5 bn\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: A firm which sells its product for $6 has the following total costs.\n\noutput (units)\n0 10\n20\n30\ntotal costs ($)\n40\n100\n120\n150\n\nWhich statement is correct?\nA Average cost is lowest when 10 units are produced.\nB The firm breaks even when 20 units are sold.\nC The firm has no fixed costs.\nD Total variable costs fall continuously over these outputs.\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: What is a direct tax?\nA a tax on electricity\nB a tax on imported goods\nC a tax on services\nD a tax on income and wealth\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: A government achieves a high rate of economic growth.\n\nHow may this conflict with other government aims?\nA It may increase government income.\nB It may increase incomes for the lower paid.\nC It may increase the supply of exports.\nD It may increase the volume of imports.\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: The directors of a firm have to discuss the following topics.\n\nWhich topic is least likely to be directly affected by the government\u2019s influence on the firm?\nA health and safety laws\nB the interest it pays on borrowed money\nC the minimum wage it must pay its workers\nD the replacement of the director of finance\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: Between 2002 and 2007, approximately 18 million Latin American households moved out of\npoverty.\n\nWhich change in the region is most likely to have caused this fall in poverty?\nA an increase in economic growth\nB an increase in inflation\nC a reduction in employment\nD a reduction in exports\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: The retail price index of a country rose during a year from 200 to 240.\n\nWhat was the annual rate of inflation?\nA 20 %\nB 40 %\nC 240 %\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: 0 %\nD 440 %\n\n\n24 What name is given to the type of unemployment that occurs while people search for new jobs?\nA cyclical\nB frictional\nC residual\nD structural\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: Why is the Human Development Index (HDI) a better indicator of comparative living standards\nthan Gross Domestic Product (GDP) per head?\nA It includes international trade.\nB It includes more measures of living standards.\nC It is measured in money terms.\nD It is more directly linked to economic growth.\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: Gross Domestic Product (GDP) per capita is commonly used as an indicator of the comparative\nlevel of development in different countries.\n\nWhat does not lead to difficulties when using this as a comparison between countries?\nA different climatic conditions\nB different international exchange rates\nC different population growth rates\nD different rates of inflation\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: India has a more evenly distributed income than China but a greater proportion of its population\nliving on less than $1 a day.\n\nWhat can be concluded from this statement?\nA China has a smaller proportion of very rich people.\nB India has a greater proportion of poor people.\nC Most of the population of India live on $1 a day.\nD The average income in China is higher than that in India.\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: What is likely to happen in a developing country as it becomes more developed?\nA A lower percentage of people will go to university.\nB Average life expectancy will rise.\nC The rate of population growth will increase.\nD The tertiary sector will decline in importance.\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: There was an increase in the value of the United States (US) dollar against the South African\nRand.\n\nWhat is a result of this?\nA an increase in the number of exports from the US to South Africa\nB an increase in the number of imports to the US from South Africa\nC fewer people from the US spend holidays in South Africa\nD more people from South Africa spend holidays in the US\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: Which policy would best enable a government to encourage greater specialisation in the use of\nits country\u2019s resources?\nA encouraging diversification in industry\nB protecting small businesses\nC reducing tariffs on imports into its country\nD subsidising job creation in rural areas\n\n\nBLANK PAGE\n\n\nBLANK PAGE\n\n\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nWhich statement about the factors of production is correct?\nA A river from which a company draws water is called land.\nB Raising finance for a company is called capital.\nC Supervisors employed in a company are called enterprise.\nD The owner of a company is called labour.\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nWhich terms summarise the nature of the economic problem?\nA finite resources and limited wants\nB finite resources and unlimited wants\nC infinite resources and limited wants\nD infinite resources and unlimited wants\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nThe government of a country with a rapidly increasing population decides to switch resources\nfrom investment to increased subsidies to farmers.\n\nWhat is the opportunity cost of this decision?\nA the profit earned by farmers\nB the rent of the land on which food is grown\nC the reduction in investment\nD the wages of the farm workers\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nWhich economic change would increase the problem of scarcity?\nA a decrease in fish stocks\nB a discovery of a new oil field\nC an increase in labour productivity\nD a reduction in waste\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nWhat is a function of a commercial bank?\nA acting as the lender of last resort\nB deciding what is a legal tender\nC determining monetary policy\nD providing overdrafts\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \n20\n30\n4 2\nprice\n($)\nquantity (units)\nS \n\nWhat is the price elasticity of supply when the price rises from $2 to $4?\nA 0.2\nB 0.5\nC 1\nD 2\n\n\n10 What is an example of occupational mobility of labour?\nA A Japanese car manufacturer locates in England.\nB A nurse returns to work after her children have grown up.\nC A student takes an evening job in a restaurant.\nD Farm workers retrain as call-centre workers.\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: A person is most likely to save more when there is an increase in a country\u2019s\nA exchange rate.\nB inflation rate.\nC interest rates.\nD money supply.\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: One of the functions of money is to act as a measure of value.\n\nWhat does this mean?\nA Money allows people to borrow and lend.\nB Money allows people to save their surplus income.\nC Money is used to buy goods and services.\nD Money is used to compare the worth of different goods and services.\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: What is a function of a trade union?\nA to negotiate workers\u2019 contracts\nB to promote workers to more responsible jobs\nC to recruit workers for the firm\nD to supervise the workers in the firm\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: A firm which sells its product for $6 has the following total costs.\n\noutput (units)\n0 10\n20\n30\ntotal costs ($)\n40\n100\n120\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: 0\n\nWhich statement is correct?\nA Average cost is lowest when 10 units are produced.\nB The firm breaks even when 20 units are sold.\nC The firm has no fixed costs.\nD Total variable costs fall continuously over these outputs.\n\n\n15 In August 2008, Infosys, an Indian information technology company, bought Axon, a UK\ninformation technology company.\n\nWhich type of integration is this?\nA conglomerate\nB horizontal\nC vertical backwards\nD vertical forwards\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: Barilla, an Italian company, is the world\u2019s largest pasta maker. It also produces bread.\n\nIn 2006 its bread production contributed $1.5 billion (bn) to its total revenue of $5.1 bn.\nOverall profit was $0.6 bn.\n\nWhat was the total cost to Barilla of producing pasta and bread in 2006?\nA $2.1 bn\nB $3.0 bn\nC $3.6 bn\nD $4.5 bn\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: What is correct about a monopoly?\nA It may benefit from economies of scale.\nB It must be privately not state owned.\nC Its costs are always higher than those of a firm in perfect competition.\nD It sells only one product.\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: The directors of a firm have to discuss the following topics.\n\nWhich topic is least likely to be directly affected by the government\u2019s influence on the firm?\nA health and safety laws\nB the interest it pays on borrowed money\nC the minimum wage it must pay its workers\nD the replacement of the director of finance\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: What is a direct tax?\nA a tax on electricity\nB a tax on imported goods\nC a tax on services\nD a tax on income and wealth\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: A government achieves a high rate of economic growth.\n\nHow may this conflict with other government aims?\nA It may increase government income.\nB It may increase incomes for the lower paid.\nC It may increase the supply of exports.\nD It may increase the volume of imports.\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: What name is given to the type of unemployment that occurs while people search for new jobs?\nA cyclical\nB frictional\nC residual\nD structural\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: Between 2002 and 2007, approximately 18 million Latin American households moved out of\npoverty.\n\nWhich change in the region is most likely to have caused this fall in poverty?\nA an increase in economic growth\nB an increase in inflation\nC a reduction in employment\nD a reduction in exports\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: The retail price index of a country rose during a year from 200 to 240.\n\nWhat was the annual rate of inflation?\nA 20 %\nB 40 %\nC 240 %\nD 440 %\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: India has a more evenly distributed income than China but a greater proportion of its population\nliving on less than $1 a day.\n\nWhat can be concluded from this statement?\nA China has a smaller proportion of very rich people.\nB India has a greater proportion of poor people.\nC Most of the population of India live on $1 a day.\nD The average income in China is higher than that in India.\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: Why is the Human Development Index (HDI) a better indicator of comparative living standards\nthan Gross Domestic Product (GDP) per head?\nA It includes international trade.\nB It includes more measures of living standards.\nC It is measured in money terms.\nD It is more directly linked to economic growth.\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: Gross Domestic Product (GDP) per capita is commonly used as an indicator of the comparative\nlevel of development in different countries.\n\nWhat does not lead to difficulties when using this as a comparison between countries?\nA different climatic conditions\nB different international exchange rates\nC different population growth rates\nD different rates of inflation\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: Which policy would best enable a government to encourage greater specialisation in the use of\nits country\u2019s resources?\nA encouraging diversification in industry\nB protecting small businesses\nC reducing tariffs on imports into its country\nD subsidising job creation in rural areas\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: What is likely to happen in a developing country as it becomes more developed?\nA A lower percentage of people will go to university.\nB Average life expectancy will rise.\nC The rate of population growth will increase.\nD The tertiary sector will decline in importance.\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: There was an increase in the value of the United States (US) dollar against the South African\nRand.\n\nWhat is a result of this?\nA an increase in the number of exports from the US to South Africa\nB an increase in the number of imports to the US from South Africa\nC fewer people from the US spend holidays in South Africa\nD more people from South Africa spend holidays in the US\n\n\nBLANK PAGE\n\n\n\nBLANK PAGE\n\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nWhat is meant by the economic problem?\nA how to achieve efficiency with the existence of fixed resources and limited wants\nB how to allocate resources between public and private sectors\nC how to balance unlimited wants against finite resources\nD how to decide which methods to use to exploit all resources\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nEach of the factors of production earns an income.\n\nWhat are the incomes for land and capital?\n\n\nland\ncapital\nA rent\ninterest\nB rent\nprofit\nC wages\ninterest\nD wages\nprofit\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nA firm decides to stop manufacturing ovens and to produce washing machines instead.\n\nWhat is the opportunity cost to the firm?\nA the additional washing machines produced\nB the cost of producing ovens\nC the cost of producing washing machines\nD the loss of the production of ovens\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nWhat is an advantage of the market economic system?\nA It aims for equality of income.\nB It ensures the provision of defence and law and order.\nC It gives an incentive to produce.\nD It reduces pollution and congestion.\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nIn a country where the demand for petrol (gas) is price-inelastic, the incidence of any increase in\npetrol tax will be mainly on\nA the company that refines the oil.\nB the motorist who buys the petrol.\nC the petrol station that sells the petrol.\nD the wholesale company that stores the petrol.\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nWhat is an example of market failure?\nA a growth of competition\nB an existence of scarcity\nC a spread of pollution\nD a surplus of production in the short-term\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nWhich action by the operators of an airport directly reduces external costs?\nA the stopping of night flights\nB the building of a new runway\nC the payment of a productivity bonus\nD the reduction of charges for landing aircraft\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: What may cause an individual to save a higher proportion of their income?\nA a belief that the price of goods will rise in the future\nB a fall in the rate of interest paid by the country\u2019s banks\nC a fear that income will fall in the future\nD a rise in the individual\u2019s wish to enjoy higher consumption immediately\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: A person wishes to buy shares in order to make a long-term profit, but wants as little risk of\nshort-term loss as possible.\n\nWhich type of share is most likely to meet these wishes?\nA a share in a coffee growing company\nB a share in a fashion house\nC a share in a high-tech electronics company\nD a share in a supermarket chain\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: Which statement about a country\u2019s banks is correct?\nA Commercial banks hold the financial accounts of the government.\nB Commercial banks settle debts by clearing customers\u2019 cheques.\nC The central bank sets the government\u2019s tax and spending policies.\nD The central bank supplies foreign currency to members of the public.\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: Why might factory workers have higher wage rates than agricultural workers?\nA Factory workers are in greater supply.\nB Factory workers face fewer risks of accidents.\nC Factory workers have cleaner working conditions.\nD Factory workers use more productive equipment.\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: A musician has a choice of playing for an orchestra in either England or Germany.\n\nWhich combination of incomes and cost of living is most likely to cause her to choose the\nGerman orchestra?\n\nIncomes and cost of living in Germany compared with those in England\n\npre-tax (gross) income\nafter-tax (net) income\ncost of living\nA higher\nhigher\nhigher\nB higher\nlower\nlower\nC lower\nhigher\nhigher\nD lower\nhigher\nlower\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: A major computer company announced that its profits had fallen below the level predicted.\n\nWhat might have caused this?\nA increased advertising costs that greatly improved sales\nB low prices that made the company\u2019s product competitive\nC new technology that reduced costs\nD reduced sales and low prices\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: A firm raised the price of its product from $10 to $15 and as a result its sales fell from 200 units to\n150 units.\n\nWhat happened to its average revenue and total revenue?\n\n\naverage revenue\ntotal revenue\nA decreased\ndecreased\nB decreased\nincreased\nC increased\ndecreased\nD increased\nincreased\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: Which change must occur when a firm starts to experience diseconomies of scale?\nA Average costs begin to rise.\nB Employees are made redundant.\nC Profits turn into losses.\nD Variable costs become fixed.\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: If a firm increases its output in the short run, what will happen to its average fixed cost (AFC)?\nA AFC will decrease continually.\nB AFC will equal zero.\nC AFC will increase then decrease.\nD AFC will increase continually.\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: Cathay Pacific, Hong Kong\u2019s largest airline, flies to a number of countries.\n\nShares in the firm are owned by both individuals and other firms in a number of countries. The\nshares are traded on the Hong Kong Stock Exchange.\n\nWhich type of business organisation is Cathay Pacific?\nA a partnership\nB a private limited company\nC a public corporation\nD a public limited company\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: The central bank of Mexico set its rate of interest to try to keep the rise in the price level to\nonly 3 %.\n\nWhich government aim was it directly trying to achieve?\nA balance of payments equilibrium\nB economic growth\nC full employment\nD low inflation\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: When is a direct tax described as progressive?\nA when the government changes the basic rate of tax in each budget\nB when the government taxes companies rather than individuals\nC when the tax takes a larger proportion of earnings as earnings increase\nD when the tax takes a smaller proportion of earnings as earnings increase\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: In 2008, the government of Argentina imposed a tax on exports of wheat and soya beans.\n\nWhat was the most likely aim of this tax?\nA to increase agricultural output\nB to increase exports\nC to reduce a budget surplus\nD to reduce the rise in domestic food prices\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: During 2009 some governments adopted policies to try to end the recession in their country and\nincrease economic growth.\n\nWhich combination of policies is most likely to achieve this?\nA lower taxes and decrease government spending\nB lower taxes and increase government spending\nC raise taxes and decrease government spending\nD raise taxes and increase government spending\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: Why may GDP not be a good measure to compare the standard of living of two countries?\nA It does not include government expenditure.\nB It does not take account of population size.\nC It is based on a sample \u2018basket of goods\u2019.\nD It only compares export prices with import prices.\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: What is likely to happen as a developing country becomes more developed?\nA A higher percentage of children will attend school.\nB Infant mortality will rise.\nC Life expectancy will fall.\nD The agricultural sector will increase in importance.\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: Many developed countries are faced with an ageing population.\n\nWhat is the likely result of this?\nA a reduced dependency ratio\nB increased mobility of labour\nC increased spending on medical care\nD reduced tax levels\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: A government may use customs barriers to restrict free trade.\n\nWhat is an economic reason for doing this?\nA to discourage the production of strategic goods\nB to improve the balance of trade\nC to increase a balance of payments deficit\nD to make imports cheaper\n\n\nBLANK PAGE\n\n\nBLANK PAGE\n\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nEach of the factors of production earns an income.\n\nWhat are the incomes for land and capital?\n\n\nland\ncapital\nA rent\ninterest\nB rent\nprofit\nC wages\ninterest\nD wages\nprofit\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nA firm decides to stop manufacturing ovens and to produce washing machines instead.\n\nWhat is the opportunity cost to the firm?\nA the additional washing machines produced\nB the cost of producing ovens\nC the cost of producing washing machines\nD the loss of the production of ovens\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nWhat is an advantage of the market economic system?\nA It aims for equality of income.\nB It ensures the provision of defence and law and order.\nC It gives an incentive to produce.\nD It reduces pollution and congestion.\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nWhat is meant by the economic problem?\nA how to achieve efficiency with the existence of fixed resources and limited wants\nB how to allocate resources between public and private sectors\nC how to balance unlimited wants against finite resources\nD how to decide which methods to use to exploit all resources\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nIn a country where the demand for petrol (gas) is price-inelastic, the incidence of any increase in\npetrol tax will be mainly on\nA the company that refines the oil.\nB the motorist who buys the petrol.\nC the petrol station that sells the petrol.\nD the wholesale company that stores the petrol.\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nWhat is an example of market failure?\nA a growth of competition\nB an existence of scarcity\nC a spread of pollution\nD a surplus of production in the short-term\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nWhich action by the operators of an airport directly reduces external costs?\nA the stopping of night flights\nB the building of a new runway\nC the payment of a productivity bonus\nD the reduction of charges for landing aircraft\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: A person wishes to buy shares in order to make a long-term profit, but wants as little risk of\nshort-term loss as possible.\n\nWhich type of share is most likely to meet these wishes?\nA a share in a coffee growing company\nB a share in a fashion house\nC a share in a high-tech electronics company\nD a share in a supermarket chain\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: Which statement about a country\u2019s banks is correct?\nA Commercial banks hold the financial accounts of the government.\nB Commercial banks settle debts by clearing customers\u2019 cheques.\nC The central bank sets the government\u2019s tax and spending policies.\nD The central bank supplies foreign currency to members of the public.\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: Why might factory workers have higher wage rates than agricultural workers?\nA Factory workers are in greater supply.\nB Factory workers face fewer risks of accidents.\nC Factory workers have cleaner working conditions.\nD Factory workers use more productive equipment.\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: A musician has a choice of playing for an orchestra in either England or Germany.\n\nWhich combination of incomes and cost of living is most likely to cause her to choose the\nGerman orchestra?\n\nIncomes and cost of living in Germany compared with those in England\n\npre-tax (gross) income\nafter-tax (net) income\ncost of living\nA higher\nhigher\nhigher\nB higher\nlower\nlower\nC lower\nhigher\nhigher\nD lower\nhigher\nlower\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: What may cause an individual to save a higher proportion of their income?\nA a belief that the price of goods will rise in the future\nB a fall in the rate of interest paid by the country\u2019s banks\nC a fear that income will fall in the future\nD a rise in the individual\u2019s wish to enjoy higher consumption immediately\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: A firm raised the price of its product from $10 to $15 and as a result its sales fell from 200 units to\n150 units.\n\nWhat happened to its average revenue and total revenue?\n\n\naverage revenue\ntotal revenue\nA decreased\ndecreased\nB decreased\nincreased\nC increased\ndecreased\nD increased\nincreased\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: Which change must occur when a firm starts to experience diseconomies of scale?\nA Average costs begin to rise.\nB Employees are made redundant.\nC Profits turn into losses.\nD Variable costs become fixed.\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: If a firm increases its output in the short run, what will happen to its average fixed cost (AFC)?\nA AFC will decrease continually.\nB AFC will equal zero.\nC AFC will increase then decrease.\nD AFC will increase continually.\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: Cathay Pacific, Hong Kong\u2019s largest airline, flies to a number of countries.\n\nShares in the firm are owned by both individuals and other firms in a number of countries. The\nshares are traded on the Hong Kong Stock Exchange.\n\nWhich type of business organisation is Cathay Pacific?\nA a partnership\nB a private limited company\nC a public corporation\nD a public limited company\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: A major computer company announced that its profits had fallen below the level predicted.\n\nWhat might have caused this?\nA increased advertising costs that greatly improved sales\nB low prices that made the company\u2019s product competitive\nC new technology that reduced costs\nD reduced sales and low prices\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: When is a direct tax described as progressive?\nA when the government changes the basic rate of tax in each budget\nB when the government taxes companies rather than individuals\nC when the tax takes a larger proportion of earnings as earnings increase\nD when the tax takes a smaller proportion of earnings as earnings increase\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: In 2008, the government of Argentina imposed a tax on exports of wheat and soya beans.\n\nWhat was the most likely aim of this tax?\nA to increase agricultural output\nB to increase exports\nC to reduce a budget surplus\nD to reduce the rise in domestic food prices\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: During 2009 some governments adopted policies to try to end the recession in their country and\nincrease economic growth.\n\nWhich combination of policies is most likely to achieve this?\nA lower taxes and decrease government spending\nB lower taxes and increase government spending\nC raise taxes and decrease government spending\nD raise taxes and increase government spending\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: The central bank of Mexico set its rate of interest to try to keep the rise in the price level to\nonly 3 %.\n\nWhich government aim was it directly trying to achieve?\nA balance of payments equilibrium\nB economic growth\nC full employment\nD low inflation\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: Why may GDP not be a good measure to compare the standard of living of two countries?\nA It does not include government expenditure.\nB It does not take account of population size.\nC It is based on a sample \u2018basket of goods\u2019.\nD It only compares export prices with import prices.\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: Many developed countries are faced with an ageing population.\n\nWhat is the likely result of this?\nA a reduced dependency ratio\nB increased mobility of labour\nC increased spending on medical care\nD reduced tax levels\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: What is likely to happen as a developing country becomes more developed?\nA A higher percentage of children will attend school.\nB Infant mortality will rise.\nC Life expectancy will fall.\nD The agricultural sector will increase in importance.\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: A government may use customs barriers to restrict free trade.\n\nWhat is an economic reason for doing this?\nA to discourage the production of strategic goods\nB to improve the balance of trade\nC to increase a balance of payments deficit\nD to make imports cheaper\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nEach of the factors of production earns an income.\n\nWhat are the incomes for land and capital?\n\n\nland\ncapital\nA rent\ninterest\nB rent\nprofit\nC wages\ninterest\nD wages\nprofit\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nA firm decides to stop manufacturing ovens and to produce washing machines instead.\n\nWhat is the opportunity cost to the firm?\nA the additional washing machines produced\nB the cost of producing ovens\nC the cost of producing washing machines\nD the loss of the production of ovens\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nWhat is an advantage of the market economic system?\nA It aims for equality of income.\nB It ensures the provision of defence and law and order.\nC It gives an incentive to produce.\nD It reduces pollution and congestion.\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nWhat is meant by the economic problem?\nA how to achieve efficiency with the existence of fixed resources and limited wants\nB how to allocate resources between public and private sectors\nC how to balance unlimited wants against finite resources\nD how to decide which methods to use to exploit all resources\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nIn a country where the demand for petrol (gas) is price-inelastic, the incidence of any increase in\npetrol tax will be mainly on\nA the company that refines the oil.\nB the motorist who buys the petrol.\nC the petrol station that sells the petrol.\nD the wholesale company that stores the petrol.\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nWhat is an example of market failure?\nA a growth of competition\nB an existence of scarcity\nC a spread of pollution\nD a surplus of production in the short-term\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nWhich action by the operators of an airport directly reduces external costs?\nA the stopping of night flights\nB the building of a new runway\nC the payment of a productivity bonus\nD the reduction of charges for landing aircraft\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: A person wishes to buy shares in order to make a long-term profit, but wants as little risk of\nshort-term loss as possible.\n\nWhich type of share is most likely to meet these wishes?\nA a share in a coffee growing company\nB a share in a fashion house\nC a share in a high-tech electronics company\nD a share in a supermarket chain\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: Which statement about a country\u2019s banks is correct?\nA Commercial banks hold the financial accounts of the government.\nB Commercial banks settle debts by clearing customers\u2019 cheques.\nC The central bank sets the government\u2019s tax and spending policies.\nD The central bank supplies foreign currency to members of the public.\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: Why might factory workers have higher wage rates than agricultural workers?\nA Factory workers are in greater supply.\nB Factory workers face fewer risks of accidents.\nC Factory workers have cleaner working conditions.\nD Factory workers use more productive equipment.\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: A musician has a choice of playing for an orchestra in either England or Germany.\n\nWhich combination of incomes and cost of living is most likely to cause her to choose the\nGerman orchestra?\n\nIncomes and cost of living in Germany compared with those in England\n\npre-tax (gross) income\nafter-tax (net) income\ncost of living\nA higher\nhigher\nhigher\nB higher\nlower\nlower\nC lower\nhigher\nhigher\nD lower\nhigher\nlower\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: What may cause an individual to save a higher proportion of their income?\nA a belief that the price of goods will rise in the future\nB a fall in the rate of interest paid by the country\u2019s banks\nC a fear that income will fall in the future\nD a rise in the individual\u2019s wish to enjoy higher consumption immediately\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: A firm raised the price of its product from $10 to $15 and as a result its sales fell from 200 units to\n150 units.\n\nWhat happened to its average revenue and total revenue?\n\n\naverage revenue\ntotal revenue\nA decreased\ndecreased\nB decreased\nincreased\nC increased\ndecreased\nD increased\nincreased\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: Which change must occur when a firm starts to experience diseconomies of scale?\nA Average costs begin to rise.\nB Employees are made redundant.\nC Profits turn into losses.\nD Variable costs become fixed.\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: If a firm increases its output in the short run, what will happen to its average fixed cost (AFC)?\nA AFC will decrease continually.\nB AFC will equal zero.\nC AFC will increase then decrease.\nD AFC will increase continually.\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: Cathay Pacific, Hong Kong\u2019s largest airline, flies to a number of countries.\n\nShares in the firm are owned by both individuals and other firms in a number of countries. The\nshares are traded on the Hong Kong Stock Exchange.\n\nWhich type of business organisation is Cathay Pacific?\nA a partnership\nB a private limited company\nC a public corporation\nD a public limited company\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: A major computer company announced that its profits had fallen below the level predicted.\n\nWhat might have caused this?\nA increased advertising costs that greatly improved sales\nB low prices that made the company\u2019s product competitive\nC new technology that reduced costs\nD reduced sales and low prices\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: When is a direct tax described as progressive?\nA when the government changes the basic rate of tax in each budget\nB when the government taxes companies rather than individuals\nC when the tax takes a larger proportion of earnings as earnings increase\nD when the tax takes a smaller proportion of earnings as earnings increase\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: In 2008, the government of Argentina imposed a tax on exports of wheat and soya beans.\n\nWhat was the most likely aim of this tax?\nA to increase agricultural output\nB to increase exports\nC to reduce a budget surplus\nD to reduce the rise in domestic food prices\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: During 2009 some governments adopted policies to try to end the recession in their country and\nincrease economic growth.\n\nWhich combination of policies is most likely to achieve this?\nA lower taxes and decrease government spending\nB lower taxes and increase government spending\nC raise taxes and decrease government spending\nD raise taxes and increase government spending\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: The central bank of Mexico set its rate of interest to try to keep the rise in the price level to\nonly 3 %.\n\nWhich government aim was it directly trying to achieve?\nA balance of payments equilibrium\nB economic growth\nC full employment\nD low inflation\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: Why may GDP not be a good measure to compare the standard of living of two countries?\nA It does not include government expenditure.\nB It does not take account of population size.\nC It is based on a sample \u2018basket of goods\u2019.\nD It only compares export prices with import prices.\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: Many developed countries are faced with an ageing population.\n\nWhat is the likely result of this?\nA a reduced dependency ratio\nB increased mobility of labour\nC increased spending on medical care\nD reduced tax levels\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: What is likely to happen as a developing country becomes more developed?\nA A higher percentage of children will attend school.\nB Infant mortality will rise.\nC Life expectancy will fall.\nD The agricultural sector will increase in importance.\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: A government may use customs barriers to restrict free trade.\n\nWhat is an economic reason for doing this?\nA to discourage the production of strategic goods\nB to improve the balance of trade\nC to increase a balance of payments deficit\nD to make imports cheaper\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nWhich combination of resources and wants causes the economic problem?\n\n\nresources\nwants\nA limited\nlimited\nB limited\nunlimited\nC unlimited\nlimited\nD unlimited\nunlimited\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nWhat does an economist mean by capital?\nA man-made goods that do not directly satisfy human wants\nB money used to set up new businesses and expand existing businesses\nC natural resources that will not be replaced\nD the ability to earn profits by combining resources to produce goods\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nA student leaves school and decides to spend the next two years at a college to improve her\nqualifications.\n\nWhat is the opportunity cost to the student of taking this decision?\nA the cost of the course fees at the college\nB the increase in job opportunities she will have as a result of her extra qualifications\nC the lost production due to her not being in work\nD the money she would have earned if she had been in work for the two years\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nWhat is found in a mixed economy but not a free market economy?\nA banks\nB division of labour\nC price controls\nD profit motive\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nA large shop selling clothes opened in a town. Its prices were much cheaper than other shops\nselling similar items. As a result many more customers came to the area. They also visited\nrestaurants near the shop. The restaurants reported a 10 % increase in sales.\n\n\nWhat economic concept does the above statement best illustrate?\nA external benefit\nB inelastic demand\nC market failure\nD perfect competition\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nWhat is not held constant in constructing a demand schedule?\nA the incomes of consumers\nB the prices of complementary goods\nC the price of the good itself\nD the tastes of consumers\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nA shop sells chocolate birthday cakes. When the price was $15 it sold 40 cakes. It reduced the\nprice to $10 and sold 60 cakes.\n\nWhat can be concluded from this?\nA The firm will make less profit because the price has fallen.\nB The firm will make more profit because sales have increased.\nC The price elasticity is inelastic because demand only increased by 50 %.\nD There is unit price elasticity because the firm\u2019s revenue remained the same after the price\nchange.\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nIn 2010, a major oil leak from an oil rig affected many people living around the Gulf of Mexico.\n\nWhat type of market failure did they experience?\nA monopoly exploitation\nB negative externality\nC price discrimination\nD rising tax burden\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: What is likely to cause wages in an occupation to be high?\nA a low level of responsibility\nB high unemployment\nC pleasant working conditions\nD the need for special skills\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: A trade union negotiates a basic weekly wage for its members with all employers in an industry.\nIn addition to the basic wage, one company also operates a production bonus at factory level.\n\nWhat is the aim of this company?\nA to give equal wages to all workers\nB to increase the efficiency of the workers\nC to introduce a minimum wage\nD to reduce its total wage bill\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: What might cause a rise in the proportion of income that a person saves?\nA a fall in interest rates\nB a fall in population\nC a fall in real incomes\nD a fall in the income tax rate\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: For anything to be used as money, it must be\nA a fixed value.\nB in fixed supply.\nC legal tender.\nD readily acceptable.\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: Which is a diseconomy of scale?\nA Bulk buying reduces costs.\nB Communications deteriorate.\nC Employees are more motivated.\nD Technological improvements take place.\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: The financial director of a company adds up the cost for the firm of rent, insurance, new\nmachinery and the chief executive\u2019s basic salary. The director then divides that total by the firm\u2019s\noutput.\n\n\nWhat has the director calculated?\nA average fixed cost\nB average revenue\nC average total cost\nD average variable cost\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: Amit and Pardeep set up in business together. Each has half of the shares in the business and\nlimited liability.\n\nWhat type of business organisation is this?\nA a co-operative\nB a partnership\nC a private company\nD a public company\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: If a perfectly competitive market becomes a monopoly, what will be likely to increase and what\nwill be likely to decrease?\n\n\nincrease\ndecrease\nA barriers to entry\neconomies of scale\nB long-run profits\ncompetition\nC output\nmarket share\nD consumer choice\nprices\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: What would be most likely to reduce the rate of inflation?\nA an increase in direct taxes\nB an increase in government expenditure\nC an increase in indirect taxes\nD an increase in the budget deficit\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: Why are schools sometimes built and run with government money?\nA The private sector could not afford the cost of investment to build schools.\nB The private sector would have lower standards than government schools.\nC The provision of schools by the government ensures the widest choice for students.\nD There are external benefits from the provision of education.\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: Changes in demand mean that the government of Bangladesh hopes to switch some production\nfrom clothes made by low-paid, unskilled workers to medicines produced by highly-trained\ntechnicians.\n\nWhich policies would enable Bangladesh to achieve this switch in employment and production?\nA close clothes factories and decrease imports\nB encourage immigration of foreign labour and introduce tariffs on clothing\nC invest in education and purchase new machines\nD substitute labour for machines and encourage emigration of workers from Bangladesh\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: Between 2009 and 2010, an economy grew by 2.1 %.\n\nWhat is most likely to have increased during this period?\nA population\nB production\nC unemployment\nD wages\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: After more than 70 years of production, a German car manufacturer, Volkswagen, has decided to\nlocate the production of its biggest selling car in developing countries, rather than Germany.\n\nWhat is the main advantage of this policy?\nA to access new management techniques\nB to make use of better infrastructure\nC to sell the car only to customers in developing countries\nD to train and employ labour at a lower cost\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: What is usually a characteristic of a developed country?\nA a dependency on primary product exports\nB high rates of economic growth\nC low levels of productivity\nD low rates of population growth\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: The charts show the population structure of a country in 1950 and 2010.\n\n3 2\n1 0\n0 1\n2 3\nmale\nfemale\nage\n85+\n80 \u2013 84\nmillions\n1950\n75 \u2013 79\n70 \u2013 74\n65 \u2013 69\n60 \u2013 64\n55 \u2013 59\n50 \u2013 54\n45 \u2013 49\n40 \u2013 44\n35 \u2013 39\n30 \u2013 34\n25 \u2013 29\n20 \u2013 24\n15 \u2013 19\n10 \u2013 14\n5 \u2013 9\n0 \u2013 4\n3 2\n1 0\n0 1\n2 3\nmale\nfemale\nage\n85+\n80 \u2013 84\nmillions\n2010\n75 \u2013 79\n70 \u2013 74\n65 \u2013 69\n60 \u2013 64\n55 \u2013 59\n50 \u2013 54\n45 \u2013 49\n40 \u2013 44\n35 \u2013 39\n30 \u2013 34\n25 \u2013 29\n20 \u2013 24\n15 \u2013 19\n10 \u2013 14\n5 \u2013 9\n0 \u2013 4\n\n\nWhat decreased between 1950 and 2010?\nA average age\nB number of people below 15\nC number of people over 60\nD total population\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: What is an advantage to a country of free trade?\nA greater international diversification of production\nB greater range of domestically produced goods\nC greater reliance on other countries\nD greater specialisation in the use of resources\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nEconomics is primarily concerned with\nA allocating scarce resources for unlimited wants.\nB controlling unemployment and inflation.\nC determining the level of government expenditure.\nD studying how new wants and economic resources can be produced.\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nWhich statement about the factors of production is correct?\nA Capital includes factories and machinery but not roads and ports.\nB Enterprise is more often found in the public sector rather than the private sector.\nC Labour is the factor that takes risks and can become unemployed.\nD Land is the natural factor that can be improved by human action.\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nA student leaves school and decides to spend the next two years at a college to improve her\nqualifications.\n\nWhat is the opportunity cost to the student of taking this decision?\nA the cost of the course fees at the college\nB the increase in job opportunities she will have as a result of her extra qualifications\nC the lost production due to her not being in work\nD the money she would have earned if she had been in work for the two years\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nWhat is true of a mixed economy but is not true of a free market economy?\nA There is a mixture of agricultural, manufacturing and service industries.\nB There is a mixture of central authorities, firms and consumers.\nC There is a mixture of external benefits and private costs.\nD There is a mixture of large and small companies.\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nJourneys in city centres may be made by bus or by car.\n\nWhat is an external cost of this?\nA bus fares\nB car fumes and noise\nC licence fees for cars\nD purchase of buses\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nWhat is not held constant in constructing a demand schedule?\nA the incomes of consumers\nB the prices of complementary goods\nC the price of the good itself\nD the tastes of consumers\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nWhat is an example of market failure?\nA a monopoly making abnormal profit\nB prices charged to cover social cost\nC the closure of small, independent shops in a rural area\nD the inability of a car producer to achieve economies of scale\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: Cleaning the streets can be an unpleasant job and yet in many countries it is badly paid.\n\nWhat is likely to be the reason for this?\nA There is a high degree of trade union membership among these workers.\nB There is a high supply of labour because the work is unskilled.\nC There is a high demand for staff in busy urban areas.\nD There is a long working year because there are few holidays.\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: What might be an advantage to a trade union when arguing for an increase in its members\u2019 pay?\nA an increase in imports of a similar product\nB the development of a new and profitable brand of the company\u2019s product\nC the development of new machines requiring fewer workers\nD the establishment of a local college providing training\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: In 2008\u20132009 the central bank of a developed country reduced interest rates from 5 % to 0.5 %\nper year to stimulate the economy.\n\nHow would this policy have affected the amount saved and the cost of borrowing by individuals?\n\n\namount saved\ncost of borrowing\nA decrease\ndecrease\nB decrease\nincrease\nC increase\ndecrease\nD increase\nincrease\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: For anything to be used as money, it must be\nA a fixed value.\nB in fixed supply.\nC legal tender.\nD readily acceptable.\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: Which is a diseconomy of scale?\nA Bulk buying reduces costs.\nB Communications deteriorate.\nC Employees are more motivated.\nD Technological improvements take place.\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: When would a firm achieve maximum profits?\nA when average revenue equals average cost\nB when average revenue minus variable cost is greatest\nC when fixed costs are equal to variable costs\nD when total revenue minus total cost is greatest\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: Which of these statements made by an Economics student about different types of business\norganisation is true?\n\nA Partnerships face problems in raising large sums of finance.\nB Private companies cannot have limited liability.\nC Public companies operate in the public sector of the economy.\nD Public corporations operate in the private sector of the economy.\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: A monopoly takes over an industry from competitive firms.\n\nWhat is not likely to be true about the monopoly compared with a competitive firm?\nA A monopoly will earn a higher rate of profit.\nB A monopoly will gain a greater share of the market.\nC A monopoly will offer a wider choice to the consumer.\nD A monopoly will operate on a larger scale of production.\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: What would be most likely to reduce the rate of inflation?\nA an increase in direct taxes\nB an increase in government expenditure\nC an increase in indirect taxes\nD an increase in the budget deficit\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: Which combination of government policies would most likely increase the rate of growth of\ndomestic production in an economy?\nA an increase in expenditure on infrastructure and an increase in income tax\nB an increase in interest rates and an increase in quotas on imported goods\nC an increase in subsidies to domestic industry and an increase in tariffs\nD an increase in value added tax (goods and services tax) and an increase in education\nexpenditure\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: Changes in demand mean that the government of Bangladesh hopes to switch some production\nfrom clothes made by low-paid, unskilled workers to medicines produced by highly-trained\ntechnicians.\n\nWhich policies would enable Bangladesh to achieve this switch in employment and production?\nA close clothes factories and decrease imports\nB encourage immigration of foreign labour and introduce tariffs on clothing\nC invest in education and purchase new machines\nD substitute labour for machines and encourage emigration of workers from Bangladesh\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: The inhabitants of an economy experience an increase in their cost of living, their living standards\nand their leisure time.\n\nWhich combination of events could explain these changes?\n\n\nprice level\nreal GDP\naverage\nworking week\nA decrease\ndecrease\nincrease\nB decrease\nincrease\ndecrease\nC increase\ndecrease\nincrease\nD increase\nincrease\ndecrease\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: What level of unemployment and what distribution of income are often found in developing\neconomies?\n\n\nlevel of unemployment\ndistribution of income\nA high\nevenly distributed\nB high\nunequal\nC low\nevenly distributed\nD low\nunequal\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: Why is the size of the average family higher in developing countries than in developed countries?\nA In developing countries babies are more likely to survive at birth.\nB In developing countries parents start families at a later age.\nC In developing countries there is often a shortage of family planning advice.\nD In developing countries the government provides a higher level of child support.\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: The charts show the population structure of a country in 1950 and 2010.\n\n3 2\n1 0\n0 1\n2 3\nmale\nfemale\nage\n85+\n80 \u2013 84\nmillions\n1950\n75 \u2013 79\n70 \u2013 74\n65 \u2013 69\n60 \u2013 64\n55 \u2013 59\n50 \u2013 54\n45 \u2013 49\n40 \u2013 44\n35 \u2013 39\n30 \u2013 34\n25 \u2013 29\n20 \u2013 24\n15 \u2013 19\n10 \u2013 14\n5 \u2013 9\n0 \u2013 4\n3 2\n1 0\n0 1\n2 3\nmale\nfemale\nage\n85+\n80 \u2013 84\nmillions\n2010\n75 \u2013 79\n70 \u2013 74\n65 \u2013 69\n60 \u2013 64\n55 \u2013 59\n50 \u2013 54\n45 \u2013 49\n40 \u2013 44\n35 \u2013 39\n30 \u2013 34\n25 \u2013 29\n20 \u2013 24\n15 \u2013 19\n10 \u2013 14\n5 \u2013 9\n0 \u2013 4\n\n\nWhat decreased between 1950 and 2010?\nA average age\nB number of people below 15\nC number of people over 60\nD total population\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: A government removed the quota on goods imported into the country.\n\nWhat is the most likely result of this?\nA a decrease in demand for domestic production\nB a decrease in domestic unemployment\nC a decrease in exports\nD a decrease in the balance of trade deficit\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nEconomics is primarily concerned with\nA allocating scarce resources for unlimited wants.\nB controlling unemployment and inflation.\nC determining the level of government expenditure.\nD studying how new wants and economic resources can be produced.\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nWhich statement about the factors of production is correct?\nA Capital includes factories and machinery but not roads and ports.\nB Enterprise is more often found in the public sector rather than the private sector.\nC Labour is the factor that takes risks and can become unemployed.\nD Land is the natural factor that can be improved by human action.\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nA student leaves school and decides to spend the next two years at a college to improve her\nqualifications.\n\nWhat is the opportunity cost to the student of taking this decision?\nA the cost of the course fees at the college\nB the increase in job opportunities she will have as a result of her extra qualifications\nC the lost production due to her not being in work\nD the money she would have earned if she had been in work for the two years\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nWhat is true of a mixed economy but is not true of a free market economy?\nA There is a mixture of agricultural, manufacturing and service industries.\nB There is a mixture of central authorities, firms and consumers.\nC There is a mixture of external benefits and private costs.\nD There is a mixture of large and small companies.\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nJourneys in city centres may be made by bus or by car.\n\nWhat is an external cost of this?\nA bus fares\nB car fumes and noise\nC licence fees for cars\nD purchase of buses\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nWhat is not held constant in constructing a demand schedule?\nA the incomes of consumers\nB the prices of complementary goods\nC the price of the good itself\nD the tastes of consumers\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nWhat is an example of market failure?\nA a monopoly making abnormal profit\nB prices charged to cover social cost\nC the closure of small, independent shops in a rural area\nD the inability of a car producer to achieve economies of scale\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: Cleaning the streets can be an unpleasant job and yet in many countries it is badly paid.\n\nWhat is likely to be the reason for this?\nA There is a high degree of trade union membership among these workers.\nB There is a high supply of labour because the work is unskilled.\nC There is a high demand for staff in busy urban areas.\nD There is a long working year because there are few holidays.\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: What might be an advantage to a trade union when arguing for an increase in its members\u2019 pay?\nA an increase in imports of a similar product\nB the development of a new and profitable brand of the company\u2019s product\nC the development of new machines requiring fewer workers\nD the establishment of a local college providing training\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: In 2008\u20132009 the central bank of a developed country reduced interest rates from 5 % to 0.5 %\nper year to stimulate the economy.\n\nHow would this policy have affected the amount saved and the cost of borrowing by individuals?\n\n\namount saved\ncost of borrowing\nA decrease\ndecrease\nB decrease\nincrease\nC increase\ndecrease\nD increase\nincrease\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: For anything to be used as money, it must be\nA a fixed value.\nB in fixed supply.\nC legal tender.\nD readily acceptable.\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: Which is a diseconomy of scale?\nA Bulk buying reduces costs.\nB Communications deteriorate.\nC Employees are more motivated.\nD Technological improvements take place.\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: When would a firm achieve maximum profits?\nA when average revenue equals average cost\nB when average revenue minus variable cost is greatest\nC when fixed costs are equal to variable costs\nD when total revenue minus total cost is greatest\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: Which of these statements made by an Economics student about different types of business\norganisation is true?\n\nA Partnerships face problems in raising large sums of finance.\nB Private companies cannot have limited liability.\nC Public companies operate in the public sector of the economy.\nD Public corporations operate in the private sector of the economy.\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: A monopoly takes over an industry from competitive firms.\n\nWhat is not likely to be true about the monopoly compared with a competitive firm?\nA A monopoly will earn a higher rate of profit.\nB A monopoly will gain a greater share of the market.\nC A monopoly will offer a wider choice to the consumer.\nD A monopoly will operate on a larger scale of production.\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: What would be most likely to reduce the rate of inflation?\nA an increase in direct taxes\nB an increase in government expenditure\nC an increase in indirect taxes\nD an increase in the budget deficit\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: Which combination of government policies would most likely increase the rate of growth of\ndomestic production in an economy?\nA an increase in expenditure on infrastructure and an increase in income tax\nB an increase in interest rates and an increase in quotas on imported goods\nC an increase in subsidies to domestic industry and an increase in tariffs\nD an increase in value added tax (goods and services tax) and an increase in education\nexpenditure\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: Changes in demand mean that the government of Bangladesh hopes to switch some production\nfrom clothes made by low-paid, unskilled workers to medicines produced by highly-trained\ntechnicians.\n\nWhich policies would enable Bangladesh to achieve this switch in employment and production?\nA close clothes factories and decrease imports\nB encourage immigration of foreign labour and introduce tariffs on clothing\nC invest in education and purchase new machines\nD substitute labour for machines and encourage emigration of workers from Bangladesh\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: The inhabitants of an economy experience an increase in their cost of living, their living standards\nand their leisure time.\n\nWhich combination of events could explain these changes?\n\n\nprice level\nreal GDP\naverage\nworking week\nA decrease\ndecrease\nincrease\nB decrease\nincrease\ndecrease\nC increase\ndecrease\nincrease\nD increase\nincrease\ndecrease\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: What level of unemployment and what distribution of income are often found in developing\neconomies?\n\n\nlevel of unemployment\ndistribution of income\nA high\nevenly distributed\nB high\nunequal\nC low\nevenly distributed\nD low\nunequal\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: Why is the size of the average family higher in developing countries than in developed countries?\nA In developing countries babies are more likely to survive at birth.\nB In developing countries parents start families at a later age.\nC In developing countries there is often a shortage of family planning advice.\nD In developing countries the government provides a higher level of child support.\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: The charts show the population structure of a country in 1950 and 2010.\n\n3 2\n1 0\n0 1\n2 3\nmale\nfemale\nage\n85+\n80 \u2013 84\nmillions\n1950\n75 \u2013 79\n70 \u2013 74\n65 \u2013 69\n60 \u2013 64\n55 \u2013 59\n50 \u2013 54\n45 \u2013 49\n40 \u2013 44\n35 \u2013 39\n30 \u2013 34\n25 \u2013 29\n20 \u2013 24\n15 \u2013 19\n10 \u2013 14\n5 \u2013 9\n0 \u2013 4\n3 2\n1 0\n0 1\n2 3\nmale\nfemale\nage\n85+\n80 \u2013 84\nmillions\n2010\n75 \u2013 79\n70 \u2013 74\n65 \u2013 69\n60 \u2013 64\n55 \u2013 59\n50 \u2013 54\n45 \u2013 49\n40 \u2013 44\n35 \u2013 39\n30 \u2013 34\n25 \u2013 29\n20 \u2013 24\n15 \u2013 19\n10 \u2013 14\n5 \u2013 9\n0 \u2013 4\n\n\nWhat decreased between 1950 and 2010?\nA average age\nB number of people below 15\nC number of people over 60\nD total population\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: A government removed the quota on goods imported into the country.\n\nWhat is the most likely result of this?\nA a decrease in demand for domestic production\nB a decrease in domestic unemployment\nC a decrease in exports\nD a decrease in the balance of trade deficit\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nA tractor factory runs out of important components and has to stop production.\n\nHow does this illustrate the economic problem?\nA The factory lacks a competitive advantage.\nB The factory lacks economies of scale.\nC There are limited wants.\nD There is evidence of scarce resources.\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nWhich group linked to a firm always bears the risk of the decision to produce?\nA creditors\nB managers\nC owners\nD workers\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nIn a pure market economy, which secondary factor determines the distribution of goods and\nservices?\nA fairness to the consumer\nB needs of the consumer\nC price of the product\nD quality of the product\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nMaize and fuel are used in the production of Mexican tortillas. In 2010 Mexico produced a record\nmaize crop but in 2011 rises in the price of fuel increased costs for tortilla makers.\n\nWhat is likely to have happened to the price of tortillas in 2010 and 2011?\n\n\nprice in 2010\nprice in 2011\nA decreased\ndecreased\nB decreased\nincreased\nC increased\ndecreased\nD increased\nincreased\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nWhen the price of shirts rises from $8 to $10, the demand for shirts falls from 1000 to 500.\n\nWhat is the price elasticity of demand for shirts?\nA greater than 1\nB unitary\nC less than 1\nD zero\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nWhat is a likely reason why many countries\u2019 governments subsidise scientific research?\nA Private sector firms may overestimate the external benefits and ignore the private benefits of\nscientific research.\nB Private sector firms may overestimate the external costs and ignore the private costs of\nscientific research.\nC Private sector firms may underestimate the private benefits and ignore the external benefits\nof scientific research.\nD Private sector firms may underestimate the private costs and ignore the external costs of\nscientific research.\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nWhen the price of a good doubles the demand falls by less than half, and the revenue received\nby the seller increases.\n\nWhat does this suggest about the good?\n\nA it has substitutes\nB it is a necessity\nC it is in fixed supply\nD it is perfectly elastic in demand\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: The use of a mobile (cell) phone to make payments is an example of which function of money?\nA a medium of exchange\nB a standard of deferred payment\nC a store of wealth\nD a unit of account\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: What is most likely to cause a person to save a larger proportion of their weekly income rather\nthan spend a larger proportion of their weekly income?\nA a decrease in the tax on goods and services\nB a decrease in weekly income\nC an increase in interest rates\nD an increase in the range of products available\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: Which of the following is most likely to limit wage increases in an industry?\n\nA an increased demand for the industry\u2019s product\nB a rise in the industry\u2019s profits\nC a rise in wages for workers in similar jobs\nD the replacement of workers with robots\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: What is a function of a trade union?\nA to negotiate workers\u2019 contracts\nB to promote workers to more responsible jobs\nC to recruit workers for the firm\nD to supervise the workers in the firm\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: Differences in earnings between higher paid and lower paid jobs have widened in developed\ncountries.\n\nWhat is the most likely reason for this?\nA Immigration of unskilled workers has reduced.\nB The demand for highly skilled workers has increased.\nC Unemployment rates have remained low.\nD Women are paid the same rates as men.\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: Which characteristic relates to perfect competition and which to monopoly?\n\n\nperfect competition\nmonopoly\nA abnormal profit\nnormal profit\nB barriers to entry\nfreedom of entry\nC few firms\nmany firms\nD price taker\nprice maker\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: Cocoa and sugar are used in a factory to produce chocolate.\n\n\nWhat is a fixed cost in the production of chocolate?\n\nA cocoa\nB electricity\nC rent\nD sugar\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: In August 2008, Infosys, an Indian information technology company, bought Axon, a UK\ninformation technology company.\n\nWhich type of integration is this?\nA conglomerate\nB horizontal\nC vertical backwards\nD vertical forwards\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: The multinational Indian Tata Group, which has companies in chemicals, consumer goods,\nengineering and communications, has been buying foreign companies.\n\nWhat does this action most likely suggest about the company?\nA It intends to achieve a domestic monopoly position.\nB It intends to increase its level of specialisation.\nC It intends to reduce fixed costs.\nD It intends to spread risks by diversification.\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \n80\n20\n50\n110\n30\n80\n140\n40\n110\n170\n\nWhat is the value of the firm\u2019s fixed costs?\nA $20\nB $30\nC $60\nD $80\n\n\n20 What is the most likely result of an increase in interest rates?\n\nA a rise in investment\nB a rise in borrowing\nC a fall in consumer spending\nD a fall in productivity\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: What is most likely to be the responsibility of a central government?\nA the provision of immigration officials at an airport\nB the provision of security cameras in a shopping centre\nC the provision of security staff at a bank\nD the provision of ticket inspectors on a train\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: In the first six months of 2011 a construction company, Morgan Sindall, saw its profits fall. Part of\nthe reason was the increased competition from foreign competitors.\n\nWhich government policy is most likely to help such a company?\nA increasing benefits to the unemployed\nB increasing tax-free allowances on new building projects\nC putting a quota on imported raw materials used by the company\nD raising interest rates\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: In developed economies there are changing patterns of employment.\n\nWhat explains why fewer work in agriculture but food production has increased?\nA increased incomes and more leisure\nB mechanisation and the use of scientific methods\nC movement to factory jobs in manufacturing\nD shift to office work using computers\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: On 17 October 2006, the US population reached 300 million and was predicted to increase to\n400 million by 2043.\n\nWhich change would mean that the US population moves in the opposite direction to that\npredicted?\nA a change from net immigration to net emigration\nB the birth rate falling more slowly than the death rate\nC the death rate falling below the net immigration rate\nD the infant mortality rate decreasing more rapidly than the increase in life expectancy\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: What is most likely to be an indicator that a country is a developed economy rather than a\ndeveloping economy?\nA a dominant service sector\nB a high birth rate\nC a lack of capital-intensive production\nD a low level of adult literacy\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: What is thought to be a benefit of global free trade?\nA It increases the opportunity for domestic producers to specialise.\nB It increases the protection for domestic producers.\nC It reduces a country\u2019s reliance on other countries.\nD It reduces the transport costs involved in trading.\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nWhy will the economic problem never be solved?\nA People will always want more products than can be produced.\nB People will never agree on what is the best economic system.\nC There will always be an uneven distribution of income.\nD There will always be some people unemployed.\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nReena makes a living by selling paintings of the town in which she lives. She sells them in an\nopen-air market once a week.\n\nIn order to be able to sell more pictures in a week she decides to buy a studio, pay someone to\nhelp in the studio and try to increase demand by advertising in the local paper.\n\nWhich factors of production were changed?\nA capital and enterprise\nB enterprise and labour\nC labour and capital\nD labour only\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nA country needs extra nurses. How could this be encouraged in a mixed economy but not in a\nmarket economy?\nA Extra part-time nursing courses could be arranged by private colleges.\nB Nurses could be given a higher statutory minimum wage.\nC Nursing students could be asked to pay increased fees.\nD Nursing training colleges could have their subsidies reduced.\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nMany countries buy oil from Saudi Arabia.\n\nWhich change is most likely to lead to a fall in the price of a barrel of oil?\nA an increase in demand of 10% with no change in supply\nB an increase in demand of 10% with an increase in supply of 10%\nC no change in demand with a 10% decrease in supply\nD no change in demand with a 10% increase in supply\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nA recent study has found that the price elasticity of demand for cigarettes in the USA is \u20130.7.\n\nWhat can be concluded from this information?\nA A fall in the price of cigarettes would lead to a fall in the revenue of cigarette producers.\nB A rise in the price of cigarettes would lead to a fall in consumer expenditure on cigarettes.\nC A 7% increase in the price of cigarettes would reduce the quantity demanded by 10%.\nD A 10% increase in the cost of producing cigarettes would lead to a 7% fall in the quantity\ndemanded.\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nA government makes public transport free to try to reduce car use in a city.\n\nWhat might explain why people continue to use their own cars?\nA Cars are less crowded than public transport.\nB Car use does not cause external costs.\nC Public transport has a better safety record than cars.\nD Public transport networks require high capital costs.\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nWhen the price of a good doubles the demand falls by less than half, and the revenue received\nby the seller increases.\n\nWhat does this suggest about the good?\n\nA it has substitutes\nB it is a necessity\nC it is in fixed supply\nD it is perfectly elastic in demand\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: A function of money is to act as a measure of value.\n\nWhat does this mean?\nA It is used to compare the worth of different goods.\nB It is used to enable monthly payments for expensive goods.\nC It is used to pay the price of a good.\nD It is used for future savings.\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: Each worker in a firm specialises in performing one task. The firm then decides that each worker\nshould carry out a variety of tasks.\n\nWhich benefit will the firm be expecting to gain from the change?\nA a decrease in the equipment workers need to be given\nB a decrease in the time it takes to train workers\nC an increase in the ability to cover for absent staff\nD an increase in the skill gained from repetition\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: Which of the following is most likely to limit wage increases in an industry?\n\nA an increased demand for the industry\u2019s product\nB a rise in the industry\u2019s profits\nC a rise in wages for workers in similar jobs\nD the replacement of workers with robots\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: What is a function of a trade union?\nA to negotiate workers\u2019 contracts\nB to promote workers to more responsible jobs\nC to recruit workers for the firm\nD to supervise the workers in the firm\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: What will happen to a firm that expands to take advantage of economies of scale?\nA Average costs of production will decrease.\nB Average costs of production will increase.\nC Profits will decrease.\nD The price of the firm\u2019s products will increase.\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: Cocoa and sugar are used in a factory to produce chocolate.\n\n\nWhat is a fixed cost in the production of chocolate?\n\nA cocoa\nB electricity\nC rent\nD sugar\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: In August 2008, Infosys, an Indian information technology company, bought Axon, a UK\ninformation technology company.\n\nWhich type of integration is this?\nA conglomerate\nB horizontal\nC vertical backwards\nD vertical forwards\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: In a city, both large and small shops sell clothes.\n\nWhy do large and small shops exist together?\nA Large clothing shops create barriers to entry.\nB Small shops always sell clothes at lower prices.\nC The market for clothing operates under perfect competition.\nD There is demand from consumers for a range of fashions.\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: An entrepreneur buys a workshop for $200 000 to make plastic boxes. In the first year of\noperation he spends $70 000 on materials, employs ten production workers paid by the amount\nproduced (piece rate) at a total cost of $80 000 and buys two delivery vehicles for $10 000 each.\n\nWhat are his total variable costs?\nA $100 000\nB $150 000\nC $220 000\nD $370 000\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: What is the most likely result of an increase in interest rates?\n\nA a rise in investment\nB a rise in borrowing\nC a fall in consumer spending\nD a fall in productivity\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: What is most likely to be the responsibility of a central government?\nA the provision of immigration officials at an airport\nB the provision of security cameras in a shopping centre\nC the provision of security staff at a bank\nD the provision of ticket inspectors on a train\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: A government reduces the interest rate to encourage economic growth.\n\nWhich other aim of government policy might now become more difficult to achieve?\nA reducing a balance of trade in goods surplus\nB reducing a government budget deficit\nC reducing the level of unemployment\nD reducing the rate of inflation\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: In an economic recession, which policy might be adopted to reduce unemployment?\nA an increase in foreign exchange rates\nB an increase in interest rates\nC a reduction in import duty\nD a reduction in tax rates\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: In the United States (US) Consumer Price Index (CPI), food has a weighting of 13.7%. In the\nIndian CPI, food\u2019s weighting is 46.2%.\n\nWhat can be concluded from this?\nA Consumers in India spend more on food than US consumers.\nB Food is a bigger proportion of consumer spending in India than in the US.\nC The farming sector\u2019s output of food is higher in India than in the US.\nD The price of food is rising more rapidly in India than in the US.\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: In Botswana, better health care has meant that birth rates have been falling faster than death\nrates. Also the number of children born, on average, to each woman has declined. In 1981,\nwomen had 6.4 children on average; by 2006, the average was 3.2\n\n\nWhat may be concluded from this information?\nA Government spending on education will need to increase.\nB Medical improvements have resulted in falling child mortality rates.\nC There will be a decline in income for each person working.\nD There will, in future, be an increase in the proportion of working population compared with\nnon-working population.\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: Which combination of changes is most likely to result in a rise in the average living standard in a\ncountry?\n\n\nGross Domestic\nProduct\npopulation\ngeneral price\nlevel\nA falls\nfalls\nrises\nB falls\nrises\nfalls\nC rises\nfalls\nfalls\nD rises\nrises\nrises\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: A country says that it wishes to increase its trade protection policies.\n\nWhat might that involve?\nA conservation of resources and taxes on external costs\nB eliminating waste in the use of resources and the encouragement of multinational companies\nC increased self sufficiency and barriers to trade\nD price controls and increased regulations on domestic monopoly industries\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nWhich characteristic relates to perfect competition and which to monopoly?\n\n\nperfect competition\nmonopoly\nA abnormal profit\nnormal profit\nB barriers to entry\nfreedom of entry\nC few firms\nmany firms\nD price taker\nprice maker\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nCocoa and sugar are used in a factory to produce chocolate.\n\n\nWhat is a fixed cost in the production of chocolate?\n\nA cocoa\nB electricity\nC rent\nD sugar\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nIn August 2008, Infosys, an Indian information technology company, bought Axon, a UK\ninformation technology company.\n\nWhich type of integration is this?\nA conglomerate\nB horizontal\nC vertical backwards\nD vertical forwards\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nThe multinational Indian Tata Group, which has companies in chemicals, consumer goods,\nengineering and communications, has been buying foreign companies.\n\nWhat does this action most likely suggest about the company?\nA It intends to achieve a domestic monopoly position.\nB It intends to increase its level of specialisation.\nC It intends to reduce fixed costs.\nD It intends to spread risks by diversification.\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nWhat is the most likely result of an increase in interest rates?\n\nA a rise in investment\nB a rise in borrowing\nC a fall in consumer spending\nD a fall in productivity\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nWhat is most likely to be the responsibility of a central government?\nA the provision of immigration officials at an airport\nB the provision of security cameras in a shopping centre\nC the provision of security staff at a bank\nD the provision of ticket inspectors on a train\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nIn the first six months of 2011 a construction company, Morgan Sindall, saw its profits fall. Part of\nthe reason was the increased competition from foreign competitors.\n\nWhich government policy is most likely to help such a company?\nA increasing benefits to the unemployed\nB increasing tax-free allowances on new building projects\nC putting a quota on imported raw materials used by the company\nD raising interest rates\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: A tractor factory runs out of important components and has to stop production.\n\nHow does this illustrate the economic problem?\nA The factory lacks a competitive advantage.\nB The factory lacks economies of scale.\nC There are limited wants.\nD There is evidence of scarce resources.\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: Which group linked to a firm always bears the risk of the decision to produce?\nA creditors\nB managers\nC owners\nD workers\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: In a pure market economy, which secondary factor determines the distribution of goods and\nservices?\nA fairness to the consumer\nB needs of the consumer\nC price of the product\nD quality of the product\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: Maize and fuel are used in the production of Mexican tortillas. In 2010 Mexico produced a record\nmaize crop but in 2011 rises in the price of fuel increased costs for tortilla makers.\n\nWhat is likely to have happened to the price of tortillas in 2010 and 2011?\n\n\nprice in 2010\nprice in 2011\nA decreased\ndecreased\nB decreased\nincreased\nC increased\ndecreased\nD increased\nincreased\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: When the price of shirts rises from $8 to $10, the demand for shirts falls from 1000 to 500.\n\nWhat is the price elasticity of demand for shirts?\nA greater than 1\nB unitary\nC less than 1\nD zero\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: What is a likely reason why many countries\u2019 governments subsidise scientific research?\nA Private sector firms may overestimate the external benefits and ignore the private benefits of\nscientific research.\nB Private sector firms may overestimate the external costs and ignore the private costs of\nscientific research.\nC Private sector firms may underestimate the private benefits and ignore the external benefits\nof scientific research.\nD Private sector firms may underestimate the private costs and ignore the external costs of\nscientific research.\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: When the price of a good doubles the demand falls by less than half, and the revenue received\nby the seller increases.\n\nWhat does this suggest about the good?\n\nA it has substitutes\nB it is a necessity\nC it is in fixed supply\nD it is perfectly elastic in demand\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: The use of a mobile (cell) phone to make payments is an example of which function of money?\nA a medium of exchange\nB a standard of deferred payment\nC a store of wealth\nD a unit of account\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: What is most likely to cause a person to save a larger proportion of their weekly income rather\nthan spend a larger proportion of their weekly income?\nA a decrease in the tax on goods and services\nB a decrease in weekly income\nC an increase in interest rates\nD an increase in the range of products available\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: Which of the following is most likely to limit wage increases in an industry?\n\nA an increased demand for the industry\u2019s product\nB a rise in the industry\u2019s profits\nC a rise in wages for workers in similar jobs\nD the replacement of workers with robots\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: What is a function of a trade union?\nA to negotiate workers\u2019 contracts\nB to promote workers to more responsible jobs\nC to recruit workers for the firm\nD to supervise the workers in the firm\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: Differences in earnings between higher paid and lower paid jobs have widened in developed\ncountries.\n\nWhat is the most likely reason for this?\nA Immigration of unskilled workers has reduced.\nB The demand for highly skilled workers has increased.\nC Unemployment rates have remained low.\nD Women are paid the same rates as men.\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: What is thought to be a benefit of global free trade?\nA It increases the opportunity for domestic producers to specialise.\nB It increases the protection for domestic producers.\nC It reduces a country\u2019s reliance on other countries.\nD It reduces the transport costs involved in trading.\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: On 17 October 2006, the US population reached 300 million and was predicted to increase to\n400 million by 2043.\n\nWhich change would mean that the US population moves in the opposite direction to that\npredicted?\nA a change from net immigration to net emigration\nB the birth rate falling more slowly than the death rate\nC the death rate falling below the net immigration rate\nD the infant mortality rate decreasing more rapidly than the increase in life expectancy\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: What is most likely to be an indicator that a country is a developed economy rather than a\ndeveloping economy?\nA a dominant service sector\nB a high birth rate\nC a lack of capital-intensive production\nD a low level of adult literacy\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: In developed economies there are changing patterns of employment.\n\nWhat explains why fewer work in agriculture but food production has increased?\nA increased incomes and more leisure\nB mechanisation and the use of scientific methods\nC movement to factory jobs in manufacturing\nD shift to office work using computers\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nA power station was built to provide electricity to rural villages in Namibia.\n\nWhat was its opportunity cost?\nA the cost of producing the electricity\nB the school which could have been built instead\nC the time given up by the architect to design the power station\nD the wages of the workers who built the power station\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nWhat is most likely to reduce the supply of factors of production in an economy?\nA increasing the age of retirement\nB introducing new methods of irrigation\nC lowering the cost of borrowing from banks\nD raising the rate of tax on profits\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nThe government of a developed country subsidises local private businesses, and encourages\nlarge foreign companies to locate in the country.\n\nWhich type of economic system is this?\nA free market\nB mixed\nC planned\nD subsistence\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nAn area attracts tourists to see rare animals but the tourists have few hotels in which to stay. The\nlocal government has given permission for a developer to build a hotel. Conservationists say that\nthe area will be ruined as the animals will move away and the nature of the area will be changed.\n\nWhat is likely to happen as a result of this decision to the private benefit of the tourists and the\nexternal cost?\n\n\nprivate benefit\nexternal cost\nA increase\nincrease\nB decrease\ndecrease\nC uncertain\nincrease\nD uncertain\ndecrease\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nWhat may cause an individual to save a higher proportion of their income?\nA a belief that the price of goods will rise in the future\nB a fall in the rate of interest paid by the country\u2019s banks\nC a fear that income will fall in the future\nD a rise in the individual\u2019s wish to enjoy higher consumption immediately\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nWhy are unskilled workers paid less than skilled workers?\nA There is a higher demand for unskilled labour than skilled labour.\nB There is a larger supply of unskilled labour than skilled labour.\nC Unskilled labour belong to trade unions.\nD Unskilled labour is more productive than skilled labour.\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: Between 2009 and 2010 the number of potential jobs for qualified law students fell by 16%.\nDuring the same period the total number of applicants for places on law courses increased.\n\nWhat is the most likely explanation for this?\nA an economic recession and an increase in general unemployment\nB an increase in crime rates and the possibility of high salaries in the legal profession\nC an increase in the retirement age for existing lawyers and an increase in law course fees\nD the merger of law firms and the closure of law courses\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: A trade union is negotiating a wage rise for its members.\n\nWhat will increase the chance of the wage rise being granted?\nA The company\u2019s product has many substitutes.\nB The economy is entering a period of recession.\nC The government has made strike action illegal.\nD Wages are a small part of the company\u2019s costs.\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: Which type of economy of scale results from a firm producing a diverse range of products?\nA buying\nB financial\nC risk bearing\nD technical\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: A market changes from perfect competition to monopoly.\n\nWhat is likely to happen in this market?\n\n\nbarriers to\nentry\neconomies\nof scale\nthe size of\nthe firm\nA decrease\ndecrease\nincrease\nB decrease\nincrease\ndecrease\nC increase\ndecrease\ndecrease\nD increase\nincrease\nincrease\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: When it produces 100 units, a firm\u2019s total variable cost is $300 and its total fixed cost is $2700.\n\nWhat is the average cost?\nA $3\nB $24\nC $27\nD $30\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: Which are two aims that a Government normally pursues when managing the performance of the\nwhole economy?\nA to encourage an increase in production and to prevent high inflation\nB to ensure no one is unemployed and to reduce exports\nC to give everyone equal incomes and to increase government revenues\nD to protect the environment and to reduce interest rates\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: The Mexican government has passed a law which prevents any monopoly charging a price\nsignificantly above its production costs. Any monopoly that breaks the law is fined.\n\nWhich type of policy measure is this?\nA minimum price\nB regulation\nC subsidy\nD tax\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: A government collects the following revenue in a year.\n\n\n$m\ntaxes on goods\n30\ntaxes on income\n500\ntaxes on services\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \ncustoms and excise duties\n50\n\nWhat is the amount of indirect tax revenue?\nA $30 m\nB $70 m\nC $100 m\nD $500 m\n\n\n20 What is the definition of inflation?\nA an increase in demand\nB an increase in output\nC an increase in the general price level\nD an increase in wages\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: It was reported in 2011 that an economy had negative economic growth for six months in a row.\n\nWhat would be evidence for such a situation?\nA an increase in GDP\nB an increase in profit levels\nC an increase in the level of unemployment\nD an increase in the standard of living\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: In which case is success for the government in achieving the first aim likely to cause problems in\nachieving the second?\n\n\nfirst aim\nsecond aim\nA full employment\nprice stability\nB high economic growth\nfull employment\nC price stability\nstable balance of payments\nD stable balance of payments\nmore even distribution of income\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: Which statement about poverty is correct?\nA Absolute poverty occurs when income falls below what is needed for survival.\nB An advanced economy is likely to have a higher level of absolute poverty than relative\npoverty.\nC It is impossible for relative poverty to rise as absolute poverty falls.\nD Relative poverty measures the same goods and services in all countries.\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: Developing countries often wish to prevent the population in rural areas moving to the towns.\nInvestment grants are given to companies if they set up their businesses in rural areas.\n\nWhat is this policy intended to achieve?\nA decreased transport costs\nB decreased external cost\nC increased economies of scale\nD increased use of labour\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: The Sri Lankan government decides to offer financial support to local firms.\n\nOf what is this an example?\nA a quota\nB a subsidy\nC a tariff\nD exchange control\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: In 2012 the UK held the Olympic Games which attracted a large number of visitors from foreign\ncountries.\n\nWhich item of the UK\u2019s current account balance will have benefitted directly from this event?\nA export trade in goods\nB export trade in services\nC import trade in goods\nD import trade in services\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: Countries in Europe were in a recession in 2012. Usually a recession would mean oil prices fall.\nIn fact in 2012, oil prices rose.\n\nWhich international events might have explained these changes?\n\n\npossible causes of an oil\nprice fall in the recession\npossible causes of an oil\nprice rise in 2012\nA European industrial\nproduction declined\nChina increased\nits car production\nB India invested huge\namounts in road building\nJapan\u2019s economy\nhad negative growth\nC Middle East conflicts made\noil supplies uncertain\nSaudi Arabia increased\noil production\nD new oil exploration in\nPoland was successful\ndemand for alternative\nfuels increased\n\n\nBLANK PAGE\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nWhat is the cause of economic scarcity?\nA limited wants with limited resources\nB limited wants with unlimited resources\nC unlimited wants with limited resources\nD unlimited wants with unlimited resources\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nWhat is a factor of production?\nA a semi-skilled, young worker\nB direct taxes received by a government\nC shares in a manufacturing company\nD stocks of money held a bank\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nWhich headline could apply to a mixed economy but not a free market economy?\nA \u2018Cheap imports put domestic producers out of business.\u2019\nB \u2018Local government planning decision angers residents.\u2019\nC \u2018Many fish die as a company pollutes a river with waste material.\u2019\nD \u2018Small shops close as large supermarkets open in the area.\u2019\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nIn 2012 the local government of a city decided to increase parking charges for motorists. It was\nintended to raise money to correct a deficit in the local government\u2019s budget. The local\ngovernment said if they did not increase charges they would not be able to provide all their\ncurrent services. Businesses complained about the likely loss of revenue if parking charges were\nincreased.\n\nWhich concepts does this statement involve?\nA inflation and the private sector\nB opportunity cost and public expenditure\nC private benefit and the free market\nD unlimited resources and a centrally planned economy\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nIn 2011 the US Government declared that the country must increase the manufacture of fuel from\ncrops such as corn that have previously only been used for food.\n\nWhat is likely to happen in the market for corn?\nA a movement along the demand curve for corn\nB a movement along the supply curve for corn\nC a shift to the left in the demand curve for corn\nD a shift to the left in the supply curve for corn\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nWhat may cause an individual to save a higher proportion of their income?\nA a belief that the price of goods will rise in the future\nB a fall in the rate of interest paid by the country\u2019s banks\nC a fear that income will fall in the future\nD a rise in the individual\u2019s wish to enjoy higher consumption immediately\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nIn a particular industry, male workers on average are paid more than female workers.\n\nWhat might explain this?\nA Female workers are less likely to take time off work.\nB Female workers are more likely to be in trade unions.\nC Male workers have higher qualifications.\nD Male workers live nearer to their place of work.\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: In South Africa, the rate of consumer spending is relatively high compared with other developing\ncountries. However, the unemployment rate is high at 25% and only 27% of students complete\nthe 12 years of basic education.\n\nAs a result, what is also likely to be found in South Africa?\nA a high average standard of living\nB a high current rate of savings\nC a high level of debt among consumers\nD a high supply of skilled workers\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: A trade union is negotiating a wage rise for its members.\n\nWhat will increase the chance of the wage rise being granted?\nA The company\u2019s product has many substitutes.\nB The economy is entering a period of recession.\nC The government has made strike action illegal.\nD Wages are a small part of the company\u2019s costs.\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: When a shoe manufacturer doubles all factors of production output more than doubles.\n\nWhich economic concept does this illustrate?\nA diseconomies of scale\nB economies of scale\nC increasing profits\nD opportunity cost\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: Which market conditions apply to firms that operate in perfect competition and which to a\nmonopoly?\n\n\nperfect competition\nmonopoly\nA demand influenced by advertising\ndemand not influenced by advertising\nB many barriers to entry\nno barriers to entry\nC no influence on price\nstrong influence on price\nD sales of branded products\nsales of unique products\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: When it produces 100 units, a firm\u2019s total variable cost is $300 and its total fixed cost is $2700.\n\nWhat is the average cost?\nA $3\nB $24\nC $27\nD $30\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: Which policy is an example of an expansionary monetary policy?\nA lower interest rates\nB lower money supply growth\nC lower public sector spending\nD lower taxation\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: What is not a public sector expenditure?\nA claims paid on travel insurance for cancelled flights\nB collections of rubbish by a local council to meet regulations on recycling waste\nC grants from central funds to compensate people whose property has been damaged by\nstorms\nD the establishment of a national database to assist the police in finding criminals\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: Which pair of government actions combines a fiscal policy with a supply-side policy?\nA changing government spending with changing interest rates\nB cutting tax rates with providing information on job vacancies\nC limiting bank lending with the privatisation of industry\nD restricting credit with less control over labour markets\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: A government collects the following revenue in a year.\n\n\n$m\ntaxes on goods\n30\ntaxes on income\n500\ntaxes on services\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \ncustoms and excise duties\n50\n\nWhat is the amount of indirect tax revenue?\nA $30 m\nB $70 m\nC $100 m\nD $500 m\n\n\n20 Which type of unemployment occurs when the total demand for goods and services in the\neconomy falls?\nA cyclical\nB frictional\nC seasonal\nD structural\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: Why is the Human Development Index (HDI) often considered to be better than GDP per head as\na measure of living standards?\nA GDP per head excludes economic growth.\nB GDP per head ignores population growth.\nC HDI includes more than the production of goods and services.\nD HDI is calculated by the national government.\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: In 2013 there was a period of low interest rates and high inflation in an economy.\n\nWho would be most likely to benefit and who most likely to lose during such a period?\n\n\nbenefit\nlose\nA borrowers\nsavers\nB consumers on fixed incomes\nfirms wishing to invest\nC credit card companies\nsellers of luxury goods\nD exporters\nbanks\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: In which case is success for the government in achieving the first aim likely to cause problems in\nachieving the second?\n\n\nfirst aim\nsecond aim\nA full employment\nprice stability\nB high economic growth\nfull employment\nC price stability\nstable balance of payments\nD stable balance of payments\nmore even distribution of income\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: Which combination of influences must have occurred for a population to be falling when there is\nno migration?\n\n\nbirth rate\ndeath rate\nfertility rate\nA falling\nfalling\nfalling\nB falling\nrising\nfalling\nC falling\nrising\nrising\nD rising\nfalling\nfalling\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: Developing countries often wish to prevent the population in rural areas moving to the towns.\nInvestment grants are given to companies if they set up their businesses in rural areas.\n\nWhat is this policy intended to achieve?\nA decreased transport costs\nB decreased external cost\nC increased economies of scale\nD increased use of labour\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: Increasing numbers of qualified medical workers from developing economies migrate to\ndeveloped economies.\n\nWhat explains this migration?\nA There are better working conditions in hospitals and clinics in developed economies.\nB There are fewer patients requiring medical treatment in developing countries.\nC There is a lack of training opportunities for medical staff in developed economies.\nD There is an oversupply of qualified medical workers in developing countries.\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: The citizens of a country which avoids international trade may benefit from\nA an increase in specialisation.\nB better political and cultural ties.\nC competitive pressure to improve the quality of goods.\nD more employment in their industries.\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: In 2012, Nokia, a mobile phone manufacturer, produced 18% of Finland\u2019s exports.\n\nWhy might this be undesirable for Finland?\nA Foreign demand for mobile phone firms may grow continuously.\nB Nokia may introduce new technology which raises total costs by less than output.\nC There may be a reduction in trade restrictions on mobile phones.\nD There may be an industrial dispute at Nokia.\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nThe government of a developed country subsidises local private businesses, and encourages\nlarge foreign companies to locate in the country.\n\nWhich type of economic system is this?\nA free market\nB mixed\nC planned\nD subsistence\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nWhat is most likely to reduce the supply of factors of production in an economy?\nA increasing the age of retirement\nB introducing new methods of irrigation\nC lowering the cost of borrowing from banks\nD raising the rate of tax on profits\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nA power station was built to provide electricity to rural villages in Namibia.\n\nWhat was its opportunity cost?\nA the cost of producing the electricity\nB the school which could have been built instead\nC the time given up by the architect to design the power station\nD the wages of the workers who built the power station\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nAn area attracts tourists to see rare animals but the tourists have few hotels in which to stay. The\nlocal government has given permission for a developer to build a hotel. Conservationists say that\nthe area will be ruined as the animals will move away and the nature of the area will be changed.\n\nWhat is likely to happen as a result of this decision to the private benefit of the tourists and the\nexternal cost?\n\n\nprivate benefit\nexternal cost\nA increase\nincrease\nB decrease\ndecrease\nC uncertain\nincrease\nD uncertain\ndecrease\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nWhen it produces 100 units, a firm\u2019s total variable cost is $300 and its total fixed cost is $2700.\n\nWhat is the average cost?\nA $3\nB $24\nC $27\nD $30\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: A market changes from perfect competition to monopoly.\n\nWhat is likely to happen in this market?\n\n\nbarriers to\nentry\neconomies\nof scale\nthe size of\nthe firm\nA decrease\ndecrease\nincrease\nB decrease\nincrease\ndecrease\nC increase\ndecrease\ndecrease\nD increase\nincrease\nincrease\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: Which type of economy of scale results from a firm producing a diverse range of products?\nA buying\nB financial\nC risk bearing\nD technical\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: A trade union is negotiating a wage rise for its members.\n\nWhat will increase the chance of the wage rise being granted?\nA The company\u2019s product has many substitutes.\nB The economy is entering a period of recession.\nC The government has made strike action illegal.\nD Wages are a small part of the company\u2019s costs.\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: Between 2009 and 2010 the number of potential jobs for qualified law students fell by 16%.\nDuring the same period the total number of applicants for places on law courses increased.\n\nWhat is the most likely explanation for this?\nA an economic recession and an increase in general unemployment\nB an increase in crime rates and the possibility of high salaries in the legal profession\nC an increase in the retirement age for existing lawyers and an increase in law course fees\nD the merger of law firms and the closure of law courses\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: Why are unskilled workers paid less than skilled workers?\nA There is a higher demand for unskilled labour than skilled labour.\nB There is a larger supply of unskilled labour than skilled labour.\nC Unskilled labour belong to trade unions.\nD Unskilled labour is more productive than skilled labour.\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: What may cause an individual to save a higher proportion of their income?\nA a belief that the price of goods will rise in the future\nB a fall in the rate of interest paid by the country\u2019s banks\nC a fear that income will fall in the future\nD a rise in the individual\u2019s wish to enjoy higher consumption immediately\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: In which case is success for the government in achieving the first aim likely to cause problems in\nachieving the second?\n\n\nfirst aim\nsecond aim\nA full employment\nprice stability\nB high economic growth\nfull employment\nC price stability\nstable balance of payments\nD stable balance of payments\nmore even distribution of income\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: It was reported in 2011 that an economy had negative economic growth for six months in a row.\n\nWhat would be evidence for such a situation?\nA an increase in GDP\nB an increase in profit levels\nC an increase in the level of unemployment\nD an increase in the standard of living\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: What is the definition of inflation?\nA an increase in demand\nB an increase in output\nC an increase in the general price level\nD an increase in wages\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: A government collects the following revenue in a year.\n\n\n$m\ntaxes on goods\n30\ntaxes on income\n500\ntaxes on services\n20\ncustoms and excise duties\n50\n\nWhat is the amount of indirect tax revenue?\nA $30 m\nB $70 m\nC $100 m\nD $500 m\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: The Mexican government has passed a law which prevents any monopoly charging a price\nsignificantly above its production costs. Any monopoly that breaks the law is fined.\n\nWhich type of policy measure is this?\nA minimum price\nB regulation\nC subsidy\nD tax\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: Which are two aims that a Government normally pursues when managing the performance of the\nwhole economy?\nA to encourage an increase in production and to prevent high inflation\nB to ensure no one is unemployed and to reduce exports\nC to give everyone equal incomes and to increase government revenues\nD to protect the environment and to reduce interest rates\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: Countries in Europe were in a recession in 2012. Usually a recession would mean oil prices fall.\nIn fact in 2012, oil prices rose.\n\nWhich international events might have explained these changes?\n\n\npossible causes of an oil\nprice fall in the recession\npossible causes of an oil\nprice rise in 2012\nA European industrial\nproduction declined\nChina increased\nits car production\nB India invested huge\namounts in road building\nJapan\u2019s economy\nhad negative growth\nC Middle East conflicts made\noil supplies uncertain\nSaudi Arabia increased\noil production\nD new oil exploration in\nPoland was successful\ndemand for alternative\nfuels increased\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: In 2012 the UK held the Olympic Games which attracted a large number of visitors from foreign\ncountries.\n\nWhich item of the UK\u2019s current account balance will have benefitted directly from this event?\nA export trade in goods\nB export trade in services\nC import trade in goods\nD import trade in services\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: The Sri Lankan government decides to offer financial support to local firms.\n\nOf what is this an example?\nA a quota\nB a subsidy\nC a tariff\nD exchange control\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: Developing countries often wish to prevent the population in rural areas moving to the towns.\nInvestment grants are given to companies if they set up their businesses in rural areas.\n\nWhat is this policy intended to achieve?\nA decreased transport costs\nB decreased external cost\nC increased economies of scale\nD increased use of labour\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: Which statement about poverty is correct?\nA Absolute poverty occurs when income falls below what is needed for survival.\nB An advanced economy is likely to have a higher level of absolute poverty than relative\npoverty.\nC It is impossible for relative poverty to rise as absolute poverty falls.\nD Relative poverty measures the same goods and services in all countries.\n\n\nBLANK PAGE\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nThe following are four ways factors of production are used.\nWhat is likely to require the greatest use of the factor enterprise?\nA a carpenter making wooden articles in his leisure time for sale at a monthly market\nB a corn farmer negotiating with other farmers to hire expensive machinery\nC a food shop owner sometimes selling flowers in the shop\nD a householder harvesting vegetables grown at home\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nTo help reduce the price of oil, new supplies are needed. However, in 2013, objectors opposed\nattempts to explore new sites because of the environmental damage the exploration might cause.\n\nHow does this illustrate the basic economic problem?\nA Oil is a limited resource.\nB Oil is expensive.\nC The exploration involves demand and supply.\nD There are external costs involved in production.\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nA person makes sandwiches at home for five hours each day. She makes 20 sandwiches per\nhour, and she sells each sandwich for $2 each.\n\nWhat is the opportunity cost if she takes a holiday on a working day?\nA $2\nB $40\nC 20 sandwiches\nD 100 sandwiches\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nWhat can be found in a mixed economy but not in a market economy?\nA a national economic development plan\nB an unequal distribution of income and wealth\nC the operation of the price mechanism\nD the private ownership of factors of production\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nA large supermarket applied to build on land which was in an area of natural beauty. The local\ngovernment allowed the building, even though the natural beauty of the area would be lost,\nbecause many jobs would be created and much needed income would be brought to the local\ncommunity.\n\nWhich economic ideas cannot be found in the above statement?\nA external cost and private enterprise\nB free market and the conservation of resources\nC opportunity cost and improved standards of living\nD public sector and external benefit\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: In 2013, a German company that manufactured medicines bought a UK company that ran a chain\nof pharmacies that sold medicines.\n\nWhat term best describes this takeover?\nA conglomerate\nB horizontal\nC vertical integration backwards\nD vertical integration forwards\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: When is a firm considered more capital-intensive than another firm?\nA when it has a lower ratio of workers to machines than the other firm\nB when it has fewer workers than the other firm\nC when it has higher variable costs than the other firm\nD when it has more machines than the other firm\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: In 2009, Gulf Airlines, which was making a loss, stated it would reduce the number of new aircraft\non order.\n\nIf it did this, which of its costs would be directly affected?\nA fixed costs\nB marginal costs\nC opportunity costs\nD variable costs\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: A government lowers the rate of interest.\n\nWho is most likely to be disadvantaged by this policy?\nA house buyers\nB manufacturers\nC retailers\nD savers\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: Which is a supply-side policy that would increase output in the long-run?\nA an increase in benefit payments\nB an increase in places at training colleges\nC an increase in the rate of income tax\nD an increase in the rate of tax employers pay\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: Russia exports wheat. In 2010, a bad harvest led the Russian government to prevent the export\nof wheat, to ensure enough supplies were kept for domestic use.\n\nWhat was the most likely outcome of the government\u2019s action?\nA prices were fixed by the wheat producers\nB the amount produced was determined by the government\nC the price of wheat abroad fell\nD there was a redistribution of domestic production\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: The government reduces the rate of income tax and increases the rate of tax on producers.\n\nFrom the initial equilibrium point X, which letter indicates the new equilibrium point in the market?\n\nD2\nD1\nS2\nD3\nS1\nS3\nO quantity\nprice\nX A\nB C\nD \n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: What is most likely to cause economic growth?\nA a better educated workforce\nB a reduction in the right to own property\nC decreased wages\nD higher taxation\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: A worker earns $250 each week, which leaves a disposable income of $175.\n\nWhat will affect the real value of the worker\u2019s $250 earned income?\nA a change in government spending\nB a change in interest rates\nC a change in the price level\nD a change in the tax rate\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: What is not a reason why the average size of families is likely to be greater in developing\ncountries than in developed countries?\nA Children offer the prospect of security in old age.\nB Government child care support is widely available.\nC Means of birth control are less available and more expensive.\nD Women are less likely to be part of the workforce.\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: In rural areas in developing countries, farmers grow food for their own consumption.\nWhy might this mean that the GDP is a weak measure of the standard of living in those\ncountries?\nA The food grown is not exported.\nB The GDP does not include agricultural production.\nC The GDP only refers to the public sector.\nD The value of the food is unknown.\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: The charts show the population structure of a country in 1960 and 2010.\n\n85+\n80-84\n75-79\n70-74\n65-69\n60-64\n55-59\n50-54\n45-49\n40-44\n35-39\n30-34\n25-29\n20-24\n15-19\n10-14\n5-9\n0-4\nage\nmillions\n1960\n3 2\n1 0\n0 1\n2 3\nmale\nfemale\n85+\n80-84\n75-79\n70-74\n65-69\n60-64\n55-59\n50-54\n45-49\n40-44\n35-39\n30-34\n25-29\n20-24\n15-19\n10-14\n5-9\n0-4\nage\nmillions\n2010\n3 2\n1 0\n0 1\n2 3\nmale\nfemale\n\n\nDuring this period, how did birth and death rates change?\n\n\nbirth rates\ndeath rates\nA fell\nfell\nB fell\nno change\nC rose\nfell\nD rose\nno change\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: What is an advantage of international specialisation?\nA choice is limited\nB countries become overdependent on each other\nC resources are used more efficiently\nD transport costs are decreased\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: Skin creams preventing sunburn made in the European Union (EU) are more effective than those\nmade in the United States (US). US tourists stock up on the creams when visiting Europe. Such\ncreams are banned from production in the US because of the chemicals in them. In 2013,\nnegotiations began to remove this ban in order to allow production in the US.\n\nHow is this freer trade likely to affect manufacturers of skin creams in the US and the EU?\n\n\nmanufacturers\nin the US\nmanufacturers\nin the EU\nA gain\ngain\nB gain\nlose\nC lose\ngain\nD lose\nlose\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nWhat is the basic economic problem?\nA finite resources and limited wants\nB finite resources and unlimited wants\nC infinite resources and limited wants\nD infinite resources and unlimited wants\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nNew oil reserves are discovered.\n\nWhat has increased in supply?\nA capital\nB enterprise\nC labour\nD land\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nA person makes sandwiches at home for five hours each day. She makes 20 sandwiches per\nhour, and she sells each sandwich for $2 each.\n\nWhat is the opportunity cost if she takes a holiday on a working day?\nA $2\nB $40\nC 20 sandwiches\nD 100 sandwiches\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nWhat would not be an example of the working of a market system?\nA a high price charged because of costly research to produce the good\nB a high price charged for a well-known painting\nC a low price charged because of economies of scale\nD a low price charged for subsidised bus travel\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nA product has a price elasticity of supply of +2. A change in price causes the quantity supplied to\nchange from 100 units to 120 units.\n\nWhat is the price change?\nA a fall of 10%\nB a fall of 40%\nC a rise of 10%\nD a rise of 40%\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nA large supermarket applied to build on land which was in an area of natural beauty. The local\ngovernment allowed the building, even though the natural beauty of the area would be lost,\nbecause many jobs would be created and much needed income would be brought to the local\ncommunity.\n\nWhich economic ideas cannot be found in the above statement?\nA external cost and private enterprise\nB free market and the conservation of resources\nC opportunity cost and improved standards of living\nD public sector and external benefit\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nA businesswoman seeks a 10-year loan from a bank. She has listed her four most valuable\npossessions which could be offered to the bank in order to obtain the loan.\n\nWhich item would the bank be least likely to accept as security for the loan?\nA a collection of gold coins, jewellery and antiques\nB a house in a desirable part of town\nC a part ownership in a race horse\nD a portfolio of government bonds\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: A trade union and employers agree a minimum wage (W1) which is above the market equilibrium\nwage (W) for that industry.\n\nO supply of labour\ndemand for labour\nwage\nlabour employed\nQ W1\nW \n\nWhat is the effect of paying the minimum wage (W1)?\nA demand for workers will exceed the supply\nB fewer workers will be employed\nC some workers will continue to be paid at wage W\nD workers will be less willing to work for the minimum wage\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: In choosing their occupation, people often take into account aspects of the job other than pay.\n\nWhich would not be a good match for the aspects of employment a worker is looking for?\n\n\ndesired aspect\noccupation\nA a wish for an outdoor lifestyle\nand to develop teamwork\narmy officer\nB a wish for foreign travel\nand to have responsibility\nairline pilot\nC a wish for public respect and\nto undertake precise work\nheart surgeon\nD a wish to work with the general\npublic and investigate nature\nmarine biologist\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: What may exist in monopoly but not in perfect competition?\nA barriers to entry\nB identical products\nC market price\nD perfect knowledge\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: What is not a reason for the decline in manufacturing industries in developed economies in\nrecent years?\nA growth of newly industrialised competitor countries\nB invention of automated production methods\nC rising costs of factor inputs in the steel industry\nD considerable skill shortages as school-leavers prefer to work in the service sector\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: In 2013, Barclays Bank had two branches in a city. It decided to close them both, move to a\ndifferent building and employ fewer hourly-paid staff.\n\nWhat is likely to have happened to the bank\u2019s fixed and variable costs?\n\n\nfixed cost\nvariable cost\nA fall\nfall\nB fall\nrise\nC rise\nfall\nD rise\nrise\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: What is most likely to cause a fall in the rate of inflation?\nA an increase in consumer spending\nB an increase in import prices\nC an increase in income tax\nD an increase in wage rates\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: In recent years, governments have had to manage the effects of a world recession.\n\nWhich supply-side policy could have been used to stimulate economic growth?\nA increases in income tax\nB investment in skills training schemes\nC payments of unemployment benefits\nD reduction in interest rates\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: Russia exports wheat. In 2010, a bad harvest led the Russian government to prevent the export\nof wheat, to ensure enough supplies were kept for domestic use.\n\nWhat was the most likely outcome of the government\u2019s action?\nA prices were fixed by the wheat producers\nB the amount produced was determined by the government\nC the price of wheat abroad fell\nD there was a redistribution of domestic production\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: A government increases expenditure on infrastructure to stimulate an economy.\n\nWith which of the other government aims for an economy might this conflict?\nA a decrease in income inequality\nB a higher rate of economic growth\nC a lower level of unemployment\nD a steady price level\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: Who is most likely to benefit during a period of inflation?\nA creditors (lenders)\nB debtors (borrowers)\nC fixed income earners\nD holders of cash\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: The Human Development Index (HDI) measures more than just average incomes.\nWhat are two additional measures it includes?\nA life expectancy\nyears of schooling\nB percentage unemployed\nnumber of hospitals\nC poverty rate\nyears of schooling\nD years of schooling\naccess to clean water\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: When would an increase in aggregate demand be least likely to result in inflation in an economy?\nA when it is the result of an increase in government expenditure\nB when it is the result of an increase in expenditure on consumer goods\nC when there are substantial unemployed resources in the economy\nD when there is a substantial increase in expenditure on imports\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: In 2013, subsistence farming, which involved a large percentage of the population, was a\nsignificant activity in the Philippines and Indonesia.\n\nWhat can be concluded about the Philippines and Indonesia from this information?\nA a good use was being made of natural resources\nB production was likely to involve skilled labour\nC the GDP in these countries was likely to be underestimated\nD there was no need to import food because the population was self-sufficient\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: Which feature is not a typical characteristic of a developed country?\nA a high death rate\nB a high literacy rate\nC a large elderly population\nD a low number of doctors per head\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: The charts show the population structure of a country in 1960 and 2010.\n\n85+\n80-84\n75-79\n70-74\n65-69\n60-64\n55-59\n50-54\n45-49\n40-44\n35-39\n30-34\n25-29\n20-24\n15-19\n10-14\n5-9\n0-4\nage\nmillions\n1960\n3 2\n1 0\n0 1\n2 3\nmale\nfemale\n85+\n80-84\n75-79\n70-74\n65-69\n60-64\n55-59\n50-54\n45-49\n40-44\n35-39\n30-34\n25-29\n20-24\n15-19\n10-14\n5-9\n0-4\nage\nmillions\n2010\n3 2\n1 0\n0 1\n2 3\nmale\nfemale\n\n\nDuring this period, how did birth and death rates change?\n\n\nbirth rates\ndeath rates\nA fell\nfell\nB fell\nno change\nC rose\nfell\nD rose\nno change\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: Which combination of changes is most likely to result in a fall in living standards in a country?\n\n\nGDP\ninflation\npopulation\nA fall\nfall\nrise\nB fall\nrise\nrise\nC rise\nfall\nfall\nD rise\nrise\nfall\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: What is an advantage of international specialisation?\nA choice is limited\nB countries become overdependent on each other\nC resources are used more efficiently\nD transport costs are decreased\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nEach of the factors of production earns an income.\nWhat are the incomes for capital and enterprise?\n\n\ncapital\nenterprise\nA interest\nprofit\nB interest\nwages\nC profit\ninterest\nD profit\nrent\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nMalaysia is a mixed economy.\nWhich statement about a mixed economy is necessarily correct?\nA private industry will provide most of the manufactured goods\nB the government will provide public goods and may provide merit goods\nC the primary sector will employ most workers\nD the transport network will be heavily subsidised\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nA person makes sandwiches at home for five hours each day. She makes 20 sandwiches per\nhour, and she sells each sandwich for $2 each.\n\nWhat is the opportunity cost if she takes a holiday on a working day?\nA $2\nB $40\nC 20 sandwiches\nD 100 sandwiches\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nIn recent years, the demand for cars in Indonesia has become more price inelastic while the\nsupply of cars has become more price elastic.\n\nWhich combination of events could have caused these changes?\n\n\nquality of public\ntransport\ntime taken to\nproduce a car\nA decreased\ndecreased\nB decreased\nincreased\nC increased\ndecreased\nD increased\nincreased\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nA large supermarket applied to build on land which was in an area of natural beauty. The local\ngovernment allowed the building, even though the natural beauty of the area would be lost,\nbecause many jobs would be created and much needed income would be brought to the local\ncommunity.\n\nWhich economic ideas cannot be found in the above statement?\nA external cost and private enterprise\nB free market and the conservation of resources\nC opportunity cost and improved standards of living\nD public sector and external benefit\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nWhat is not a function of a trade union?\nA to arrange promotion for its members\nB to discuss members\u2019 working conditions\nC to negotiate members\u2019 wages\nD to represent members in disputes\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: When elderly people retire from work, they may receive a pension income that is lower than their\nprevious income.\n\nHow is the proportion of their income spent on healthcare and leisure likely to change?\n\n\nhealthcare\nleisure\nA decrease\ndecrease\nB decrease\nincrease\nC increase\ndecrease\nD increase\nincrease\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: What is not usually associated with the existence of a monopoly?\nA barriers to entry\nB perfect knowledge\nC profit maximisation\nD small firms\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: A group of farmers form a partnership. They buy more machinery which they share in the\nproduction of cereals.\n\nWhat is a benefit of using more machinery?\nA it eliminates the need to train labour\nB it encourages more labour-intensive methods\nC it increases the productivity of each farmer\nD it reduces total capital costs of production\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: Large-scale organisations can suffer from problems of coordination between departments which\ncause diseconomies of scale in the long-run.\n\nWhat indicates that diseconomies of scale have set in?\nA average fixed costs begin to decrease\nB average variable costs begin to decrease\nC rate of growth of output begins to decrease\nD total revenue begins to decrease\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: Which policy combination will have the greatest impact on increasing the level of total spending in\nthe economy?\n\n\ntaxation\ngovernment\nspending\nA decreased\ndecreased\nB decreased\nincreased\nC increased\ndecreased\nD increased\nincreased\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: A toy company bought a $750 000 batch of raw plastic from a local firm and moulded it into toys.\nThe total revenue from the toys was $1 000 000. The government demanded that the company\npay tax on this action.\n\nWhat is the most likely tax that the company has to pay?\nA capital gains tax\nB goods and services (value added) tax\nC import duty\nD income tax\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: Russia exports wheat. In 2010, a bad harvest led the Russian government to prevent the export\nof wheat, to ensure enough supplies were kept for domestic use.\n\nWhat was the most likely outcome of the government\u2019s action?\nA prices were fixed by the wheat producers\nB the amount produced was determined by the government\nC the price of wheat abroad fell\nD there was a redistribution of domestic production\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: 00\n2010\nmanufacturing\n204\n88\ntransport\n72\n135\ntotal including all other sources\n685\n543\n\nWhat would be likely to have the greatest effect on reducing carbon dioxide emissions?\nA introducing incentives to encourage manufacturers to reduce their emissions\nB providing grants to fit solar panels to manufacturing premises\nC raising taxes on petroleum and diesel fuel\nD subsidising car manufacturers\n\n\n20 How is economic growth measured?\nA by an increase in consumer demand\nB by an increase in literacy\nC by an increase in output\nD by an increase in wages\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: Domestic consumption in an economy fell.\n\nWhat might have reduced the impact of that fall on the economy?\nA exports also declined\nB imports also declined\nC savings also increased\nD taxes also increased\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: In 2014, farmers\u2019 crops were destroyed by two months of bad weather. As a result, in that year,\nthey did not employ as many people at harvest time.\nWhat type of unemployment would this cause?\nA cyclical\nB frictional\nC seasonal\nD structural\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: The following information was published by an economy\u2019s central bank.\n\nIn which case was real GDP growth highest?\n\n\nrate of nominal\nGDP growth (%)\nrate of\ninflation (%)\nA 2.0\n1.0\nB 7.0\n5.0\nC 9.0\n13.0\nD 10.0\n11.0\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: The Human Development Index can be used to measure human development in countries.\n\nWhich measure would not be part of its calculation?\nA inequality of incomes\nB life expectancy\nC standards of living\nD years of schooling\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: The ratio of males to females in Russia is 90 to 100.\n\nWhat could explain this imbalance?\nA more women than men emigrate from Russia\nB ten male babies are born for every nine female babies\nC the infant mortality rate is higher among girls than boys\nD women have a longer life expectancy than men in Russia\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: The charts show the population structure of a country in 1960 and 2010.\n\n85+\n80-84\n75-79\n70-74\n65-69\n60-64\n55-59\n50-54\n45-49\n40-44\n35-39\n30-34\n25-29\n20-24\n15-19\n10-14\n5-9\n0-4\nage\nmillions\n1960\n3 2\n1 0\n0 1\n2 3\nmale\nfemale\n85+\n80-84\n75-79\n70-74\n65-69\n60-64\n55-59\n50-54\n45-49\n40-44\n35-39\n30-34\n25-29\n20-24\n15-19\n10-14\n5-9\n0-4\nage\nmillions\n2010\n3 2\n1 0\n0 1\n2 3\nmale\nfemale\n\n\nDuring this period, how did birth and death rates change?\n\n\nbirth rates\ndeath rates\nA fell\nfell\nB fell\nno change\nC rose\nfell\nD rose\nno change\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: What is an advantage of international specialisation?\nA choice is limited\nB countries become overdependent on each other\nC resources are used more efficiently\nD transport costs are decreased\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: Which combination of changes would raise the price of the Pakistani rupee on the foreign\nexchange market?\n\n\ndemand for\nPakistan\u2019s exports\nPakistan\u2019s demand\nfor imports\nA decrease\ndecrease\nB decrease\nincrease\nC increase\ndecrease\nD increase\nincrease\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nAn increase in the number of manufacturing robots in the car manufacturing industry represents\nan increase in the quantity of which factor of production?\nA capital\nB enterprise\nC labour\nD land\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nA government taxes the production of cars.\n\nWhat is likely to decrease?\nA the cost of supplying cars\nB the price of cars\nC the revenue for the government\nD the supply of cars at every price\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nWhich pair of economic institutions can be found in a market economy?\nA charities and public corporations\nB multinationals and commercial banks\nC public corporations and private companies\nD stock exchange and government hospitals\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nWhat might a trade union usually be expected to do for its members?\nA arrange childcare facilities for members\u2019 children\nB ensure adequate promotion prospects exist\nC negotiate better working conditions\nD provide medical insurance\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nWhat is the usual reason why citizens trust their country\u2019s banknotes?\nA They are acceptable for trade and exchange.\nB They are backed by gold at the central bank.\nC They are convertible into the US$ or Chinese Yuan.\nD They are recognisable and in infinite supply.\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: How does a firm guarantee that it makes the maximum profit?\nA by maximising the difference between its total revenue and total cost\nB by maximising the number of goods that it sells\nC by minimising the number of goods that it keeps in stock\nD by minimising the difference between average revenue and average cost\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: Which characteristic does a firm in perfect competition have in common with a monopoly?\nA the ability to exclude rivals\nB the benefit of internal economies of scale\nC the problem of diseconomies of scale\nD the wish to maximise profits\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: 0\n\nWhat is the firm experiencing?\nA constant returns to scale\nB diseconomies of scale\nC external diseconomies of scale\nD external economies of scale\n\n\n15 The diagram shows the demand and supply of places in independent (private) schools which\ncharge fees. The equilibrium position is X.\n\nThe costs of independent (private) schools rise. Also a report is issued which states that\nGovernment schools achieve very good examination results.\n\nWhat is likely to be the new equilibrium position?\n\nprice\nquantity\nX A\nB D\nC O\n\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: A government wishes to stimulate economic recovery.\n\nWhich action will assist this?\nA decreasing government investment\nB decreasing income tax\nC increasing indirect taxation\nD increasing interest rates\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: What is an expansionary monetary policy?\nA a decrease in the interest rate\nB a decrease in the rate of value added tax\nC an increase in the power of trade unions\nD an increase in the standard rate of income tax\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: A government decides to make two changes to its taxation policies. It lowers the tax on petrol and\nraises the tax on food.\n\nHow do these changes affect the regressive nature of the taxes?\n\n\nlower petrol\ntax\nhigher food\ntax\nA less regressive\nless regressive\nB less regressive\nmore regressive\nC more regressive\nless regressive\nD more regressive\nmore regressive\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: 0\ninsurance policy tax\n10\nsales tax (VAT)\n400\n\nWhat is the total amount of revenue raised by indirect taxes?\nA $95 m\nB $300 m\nC $400 m\nD $495 m\n\n\n20 What is Gross Domestic Product (GDP) divided by to calculate GDP per head?\nA net migration\nB the birth rate\nC the total population\nD the working population\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: Who is made worse off during a period of deflation?\nA cash holders\nB creditors\nC debtors\nD fixed income earners\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: What must result when a country experiences economic growth?\nA a higher Gross Domestic Product\nB a lower rate of inflation\nC a surplus on the balance of trade\nD an improved standard of living for everybody\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: Why may the figure calculated for a developing country\u2019s Gross Domestic Product be inaccurate?\nA There are unused resources.\nB There is a high reliance on imports.\nC There is a large amount of subsistence farming.\nD There is a small amount of skilled labour.\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: It has been predicted that by 2050 China will have 53 million fewer children under 14, 100 million\nfewer workers and 234 million more people aged over 60.\n\nWhat will be the likely effect in China of these changes?\nA The dependency ratio will fall.\nB The Government\u2019s expenditure will fall.\nC The Government\u2019s income will fall.\nD The total population will fall.\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: What might cause the balance on the current account of Mauritius to improve?\nA increased purchases of coffee from Kenya\nB increased transport of Mauritian goods in Greek ships\nC increased spending by Mauritians on holidays in South Africa\nD increased spending by tourists in Mauritian hotels\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: A country says that it wishes to increase its trade protection policies.\n\nWhat might that involve?\nA conservation of resources and taxes on external costs\nB eliminating waste in the use of resources and grants to multinational companies\nC increased self sufficiency and increased tariffs\nD price controls and increased regulations on domestic monopoly industries\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: It has been suggested that all countries producing arms should ban the export of weapons and\ncut production in order to reduce the risk of war.\n\nWhat would happen if this occurred?\nA The balance of payments on current account of countries exporting weapons would\nimmediately improve.\nB The price of existing weapons would fall.\nC There would be a risk of structural unemployment in countries that are major producers of\nweapons.\nD There would be no overall effect on the balance of payments as countries would produce\ntheir own weapons.\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: 70% of the 10 million kilograms of tea produced in India is exported. The UK, Japan, and\nGermany buy the most.\n\nWholesale prices rose 10% in 2013 as supply was restricted because of a strike.\n\nHow would these circumstances be shown in international trade accounts?\nA a credit on the goods and services account for Germany\nB a debit on the goods and services account for Japan\nC a 10% fall in the balance of the goods and services account for India\nD a 10% rise in the balance of goods and services account for the UK\n\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nWhat is the best example of the existence of the economic problem?\nA A government provides accommodation for all those who are homeless.\nB A police force has a lengthening list of unsolved crimes.\nC Janitha hands her homework in at the last permitted deadline.\nD Musa completes his journey without putting petrol in his car.\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nA government taxes the production of cars.\n\nWhat is likely to decrease?\nA the cost of supplying cars\nB the price of cars\nC the revenue for the government\nD the supply of cars at every price\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nWhich pair of economic institutions is most likely found in a market economy?\nA free accident and emergency hospitals and charities\nB partnerships and public corporations\nC stock exchange and monopolies\nD trade unions and local government schools\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nA trade union agrees on a \u2018closed shop\u2019 policy with employers in an industry.\n\nHow does this operate?\nA All workers will be members of the trade union.\nB Employment will be open only to skilled workers.\nC The employers cannot make workers redundant.\nD Workers cannot move between employers.\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nWhen will a central bank act as lender of last resort to a commercial bank?\nA when a commercial bank faces a liquidity crisis\nB when a commercial bank fails to make a profit\nC when a commercial bank needs to raise share capital\nD when a commercial bank reduces its lending rates\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: How does a firm guarantee that it makes the maximum profit?\nA by maximising the difference between its total revenue and total cost\nB by maximising the number of goods that it sells\nC by minimising the number of goods that it keeps in stock\nD by minimising the difference between average revenue and average cost\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: Two firms agree to integrate their activities.\n\nWhat must result?\nA a change in their ownership structure\nB a lowering of average costs of production\nC a move from national to international markets\nD a reduction in the level of market risk\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: A government wishes to stimulate economic recovery.\n\nWhich action will assist this?\nA decreasing government investment\nB decreasing income tax\nC increasing indirect taxation\nD increasing interest rates\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: A government fixes the rate of income tax at $0.20 per dollar earned.\n\nWhat describes this type of taxation?\nA indirect\nB progressive\nC proportional\nD regressive\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: A government introduces a law to reduce the restrictive practices of trade unions.\n\nWhat would be the most likely purpose of this law?\nA to change from a mixed to a planned economy\nB to ensure a fairer distribution of earnings\nC to increase competition in labour markets\nD to reduce government expenditure on job training\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: 0\ninheritance tax\n50\nsales tax (VAT)\n300\n\nWhat is the total amount of revenue raised by indirect taxes?\nA $300 m\nB $350 m\nC $385 m\nD $435 m\n\n\n20 What would best indicate the start of an economic boom?\nA negative growth of Gross Domestic Product\nB rising interest rates\nC rising levels of employment\nD steadily falling price levels\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: A country has a very high Gross Domestic Product and a small population but has a low standard\nof living.\n\nWhat may be the cause of this low standard of living?\nA There is a high inequality of income distribution and a high provision of merit goods.\nB There is a high inequality of income distribution and a limited provision of merit goods.\nC There is equality of income distribution and a high provision of merit goods.\nD There is equality of income distribution and a low provision of merit goods.\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: The weight for a product in the consumer price index was increased.\n\nWhat is most likely to have caused this adjustment?\nA The product has become more expensive to produce.\nB The product has been offered for sale in more retail outlets.\nC The product has improved in quality and performance.\nD The product has taken a bigger share of consumers\u2019 income.\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: China is classified as a developing country. Recently, contributions to its Gross Domestic Product\n(GDP) were agriculture 10%, construction 13%, manufacturing 32% and services 45%.\n\nWhich contribution to GDP usually decreases first when countries move to a higher level of\ndevelopment?\nA agriculture\nB construction\nC manufacturing\nD services\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: Some people think that the debts and interest payments of the poorest countries in the world\nshould be cancelled.\n\nWhat might be a disadvantage for the poorest countries if this were done?\nA International banks might be less willing to give loans to poor countries.\nB Interest payments to the lenders would fall.\nC The standard of living of people in the poorest countries would fall.\nD Trade between the poorest countries and the rest of the world would increase.\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: Which country is likely to have the highest standard of living?\n\n\nbirth rate\ndeath rate\ninfant mortality\nrate\nlife expectancy\nA 41\n20\n31\n49\nB 32\n14\n29\n59\nC 25\n6 25\n79\nD 25\n5 22\n79\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: What might cause the balance on the current account of Mauritius to improve?\nA increased purchases of coffee from Kenya\nB increased transport of Mauritian goods in Greek ships\nC increased spending by Mauritians on holidays in South Africa\nD increased spending by tourists in Mauritian hotels\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: A country says that it wishes to increase its trade protection policies.\n\nWhat might that involve?\nA conservation of resources and taxes on external costs\nB eliminating waste in the use of resources and grants to multinational companies\nC increased self sufficiency and increased tariffs\nD price controls and increased regulations on domestic monopoly industries\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: It has been suggested that all countries producing arms should ban the export of weapons and\ncut production in order to reduce the risk of war.\n\nWhat would happen if this occurred?\nA The balance of payments on current account of countries exporting weapons would\nimmediately improve.\nB The price of existing weapons would fall.\nC There would be a risk of structural unemployment in countries that are major producers of\nweapons.\nD There would be no overall effect on the balance of payments as countries would produce\ntheir own weapons.\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: The US currently trades in oil with the UK. The discovery of new oil and gas deposits in the US\nwill mean that its oil imports decrease and its oil exports increase.\n\nFrom the initial equilibrium point of X, which letter indicates the new equilibrium point for the US\nexchange rate?\n\nD1\nD S1\nD2\nS S2\nO quantity of $\nprice\nof $\nX A\nB C\nD \n\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nWhich firm is likely to find it most difficult to expand the use of its main factor of production?\nA a farm growing crops in extensive fields\nB a technology firm dependent on risky innovations\nC a textile firm making use of labour-intensive systems\nD an engineering firm relying upon capital-intensive methods\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nA government taxes the production of cars.\n\nWhat is likely to decrease?\nA the cost of supplying cars\nB the price of cars\nC the revenue for the government\nD the supply of cars at every price\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nWhich pair of economic institutions can be found in a market economy?\nA local government and charities\nB monopolies and commercial banks\nC nationalised industries and partnerships\nD stock exchange and public corporations\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nWhat does the term \u2018closed shop\u2019 mean?\nA a bankrupt retail establishment\nB a trade union that is approved by the government\nC an agreement that all workers must be members of the same trade union\nD an agreement by trade unions to share members\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nWhat function does a central bank fulfil?\nA It issues currency.\nB It offers overdraft facilities to individuals.\nC It operates deposit accounts.\nD It raises taxation.\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: How does a firm guarantee that it makes the maximum profit?\nA by maximising the difference between its total revenue and total cost\nB by maximising the number of goods that it sells\nC by minimising the number of goods that it keeps in stock\nD by minimising the difference between average revenue and average cost\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: What is true when comparing a monopoly to a perfectly competitive firm?\nA Monopolies will have perfect knowledge of their market.\nB Monopoly costs are always lower owing to economies of scale.\nC Monopoly price is likely to be higher.\nD The products that monopolies produce have more limited demand.\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: A government wishes to stimulate economic recovery.\n\nWhich action will assist this?\nA decreasing government investment\nB decreasing income tax\nC increasing indirect taxation\nD increasing interest rates\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: When a government aims to encourage economic growth it may adopt supply-side policies.\n\nWhich policy is a supply-side policy?\nA increasing the money supply\nB lowering interest rates\nC reducing direct taxation\nD retraining unemployed workers\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: Which policy combination will be the most effective if a government wishes to increase the level\nof employment?\nA decrease general taxation and increase the rate of interest\nB decrease general taxation and decrease the rate of interest\nC increase general taxation and decrease the rate of interest\nD increase general taxation and increase the rate of interest.\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: What is most likely to lead to a rise in the rate of inflation?\nA a decrease in consumer spending\nB a decrease in unemployment benefits\nC an increase in import prices\nD an increase in income tax\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: Which measures, in addition to Gross Domestic Product per capita, are included in the Human\nDevelopment Index?\nA average earnings and inequalities of incomes\nB balance of trade and balance of payments\nC life expectancy at birth and expected years of schooling\nD size of population and age structure of population\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: Why might the emigration of workers help the economy of a developing country?\nA The dependency ratio is likely to improve.\nB The inflow of transfers of money is likely to increase.\nC The least healthy workers are likely to be the last ones to leave.\nD The more skilled workers are likely to be the ones to leave.\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: What combination of changes in the birth rate and death rate is most likely to increase the\ndependency ratio in a country?\n\n\nbirth rate\ndeath rate\nA falls\nfalls\nB falls\nrises\nC rises\nfalls\nD rises\nrises\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: What might cause the balance on the current account of Mauritius to improve?\nA increased purchases of coffee from Kenya\nB increased transport of Mauritian goods in Greek ships\nC increased spending by Mauritians on holidays in South Africa\nD increased spending by tourists in Mauritian hotels\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: A country says that it wishes to increase its trade protection policies.\n\nWhat might that involve?\nA conservation of resources and taxes on external costs\nB eliminating waste in the use of resources and grants to multinational companies\nC increased self sufficiency and increased tariffs\nD price controls and increased regulations on domestic monopoly industries\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: It has been suggested that all countries producing arms should ban the export of weapons and\ncut production in order to reduce the risk of war.\n\nWhat would happen if this occurred?\nA The balance of payments on current account of countries exporting weapons would\nimmediately improve.\nB The price of existing weapons would fall.\nC There would be a risk of structural unemployment in countries that are major producers of\nweapons.\nD There would be no overall effect on the balance of payments as countries would produce\ntheir own weapons.\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: The value of the Pakistani rupee changes, from 60 rupees to US$1, to 50 rupees to US$1.\n\nWhat effect will this have on the price of Pakistani products sold in the US and the price of US\nproducts sold in Pakistan?\n\n\nprice of Pakistani products\nsold in the US\nprice of US products\nsold in Pakistan\nA increase\nincrease\nB increase\ndecrease\nC decrease\nincrease\nD decrease\ndecrease\n\n\nBLANK PAGE\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nWhich combination of terms gives the general definition of the economic problem?\nA bigger families, less food, starvation\nB falling supply, rising demand, shortage\nC higher population, fewer jobs, unemployment\nD limited resources, unlimited wants, scarcity\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nHelium is a gas that is limited in supply. It takes thousands of years to form from decaying\nradioactive rocks. The US government holds 35% of the world\u2019s supply and has been selling its\nstocks. Helium is essential in medical scanners. It is also used for party balloons which some say\nis a wasteful alternative use of a valuable good.\n\nWhich concepts can be applied to the above statement?\nA demand and supply, government subsidy\nB excess demand, resource allocation\nC factors of production, private monopoly\nD opportunity cost, public sector\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nA football club raises all stadium seat prices by 5%. The stadium is divided into four zones. The\ndemand for seats falls by 1% in zone W, by 3% in zone X, by 5% in zone Y and by 6% in zone Z.\n\nIn which zone is the responsiveness of demand for seats to the price change elastic?\nA zone W\nB zone X\nC zone Y\nD zone Z\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nA project to build one of the world\u2019s biggest coal mines was planned in Australia. The project was\nestimated to cost $US12.5 million. It would create employment but threaten endangered species\nas large coal ships would damage the Great Barrier Reef.\n\nWhat effects would this project have on the following costs and benefits?\n\n\nprivate cost\nprivate benefit\nexternal cost\nA decrease\nuncertain\nuncertain\nB increase\ndecrease\nincrease\nC increase\nincrease\nincrease\nD uncertain\nincrease\nincrease\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nWhat is likely to happen when the rate of interest increases?\nA consumer spending increases\nB firms buy fewer machines\nC people hold more cash\nD savers earn lower rewards\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nIn which type of work are employees most likely to earn their highest income at a relatively young\nage?\nA manual building work\nB professional legal work\nC skilled craft work\nD university teaching work\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: Individuals produced their own goods. They then decided to specialise. They formed a group and\noffered their skills to each other but without the use of money.\n\nWhat is not likely to be the result for the group?\nA It will enjoy a rise in its material standard of living.\nB It will have a wider choice of goods and services.\nC It will need to use a system of barter.\nD It will save time in obtaining goods and services.\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: Tea is a very popular drink in Turkey and Morocco but coffee is an alternative drink preferred by\nmany people. Many caf\u00e9s provide a small biscuit with either a cup of tea or coffee. Some people\nput sugar in the drinks to sweeten them.\n\nHow would the relation between these goods be classified?\n\n\ntea and coffee\ntea and biscuits\ncoffee and sugar\nA complement\ncomplement\ncomplement\nB complement\nsubstitute\nsubstitute\nC substitute\ncomplement\ncomplement\nD substitute\ncomplement\nsubstitute\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: To achieve horizontal integration, a firm producing tyres could merge with another firm producing\nA motor cars.\nB rubber.\nC tyre-producing machinery.\nD tyres.\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: Which cost would be considered variable by a bus company?\nA a new bus\nB diesel fuel\nC loan repayment\nD rent\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: A monopoly takes over an industry from competitive firms.\n\nWhat is not likely to be true about a monopoly compared with a competitive firm?\nA A monopoly will earn a higher rate of profit.\nB A monopoly will gain a greater share of the market.\nC A monopoly will offer a wider choice to the consumer.\nD A monopoly will operate on a larger scale of production.\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: When is a tax progressive?\nA when some goods have a higher tax than others\nB when the rate of tax increases as income increases\nC when the tax is linked to the rate of inflation\nD when the tax is on incomes rather than on goods or services\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: A government intends to improve skills by offering free training to school leavers at age 16 until\nthey reach 18 years. It proposes to pay for this by taxing the profits of firms.\n\nWhich policies do these proposals involve?\n\n\nprovision of\nskills training\npayment for\nskills training\nA fiscal\nfiscal\nB monetary\nmonetary\nC supply-side\nfiscal\nD supply-side\nmonetary\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: In trying to achieve one of its aims a government may make it difficult to achieve another aim.\n\nWhat is an example of this conflict?\nA Achieving a more even distribution of income may prevent a rise in the average standard of\nliving.\nB Achieving an increase in economic growth may prevent full employment.\nC Achieving full employment may prevent stable prices.\nD Achieving stable prices may prevent a current account surplus on the balance of payments.\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: The charts relate to the Financial Statement of the government of New Zealand for 2014.\n\ntax from\nincomes\n31%\ncorporate\ntax\n10%\nother\ntaxes\n9%\ngoods and\nservices tax\n18%\nother\nrevenue\n14%\nsales of goods\nand services\n18%\n$89.4\nbillion (b)\ntotal\nrevenue\n$92.2\nbillion (b)\ntotal\nexpenses\nother\n$21.0b\nhealth\n$14.9b\nwelfare\n$23.3b\neducation\n$12.3b\nstate\nenterprises\n$20.7b\n\n\nWhat can be concluded?\nA Expenditure on welfare was higher than the combined expenditure on education and health.\nB The government was $2.8 billion in surplus.\nC The largest source of the government\u2019s income was from direct taxation.\nD The number of business corporations was very small.\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: A newspaper reported that a country\u2019s economy had grown by 3% during the last year.\n\nWhat must have increased in that year?\nA costs of production\nB gross domestic product\nC unemployment\nD wage levels\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: A country has a low GDP and a large population but ranks relatively highly on the HDI.\n\nWhich combination may exist in the country?\n\n\nincome per head\nprovision of education and\nhealthcare (merit goods)\nA high\nhigh\nB high\nlow\nC low\nlow\nD low\nhigh\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: The information below refers to an economy for a financial year.\n\ngovernment expenditure\n= $2866 million\ngovernment revenue\n= $1940 million\n\nWhat was the budget balance of the government in that year?\nA $926 million in deficit\nB $4806 million in deficit\nC $926 million in surplus\nD $4806 million in surplus\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: In a developing country real incomes have risen.\n\nWhich situation would definitely have caused this?\n\n\nprice level\nmoney\nincomes\nA fell\nfell\nB fell\nrose\nC rose\nunchanged\nD rose\nfell\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: Which characteristic do developed and developing economies have in common?\nA participation in international trade\nB high birth rates and high death rates\nC rapid economic growth\nD stable financial conditions and institutions\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: Which government policy is most likely to increase the volume of exports?\nA devaluation\nB embargoes\nC quotas\nD tariffs\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: What is necessarily involved in international free trade?\nA the absence of transport costs\nB the gift of foreign aid from charities\nC the supply of zero interest rate government loans\nD the unrestricted exchange of goods and services\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: In recent years, the US has experienced a deficit on its overall current account of the balance of\npayments.\n\nWhat could have led to an increase in the size of the deficit?\nA increased competitiveness of goods made in the US\nB increased earnings by US investors in foreign companies\nC increased numbers of overseas visitors to the US\nD increased spending on US military bases abroad\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: In 2015, China was the world\u2019s largest exporter of manufactured goods and a major importer of\noil and minerals. China devalued the yuan (renminbi) by 2%.\n\nAccording to economic theory, what would have been a consequence of this devaluation?\nA China paid less in foreign currencies for imports.\nB China reduced its demand for oil and minerals.\nC China\u2019s exports became less competitive.\nD China\u2019s trading partners improved their balance of trade with China.\n\n\nBLANK PAGE\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nWhich is not a factor of production?\nA a farm\nB a farmer\nC a farmer\u2019s bank account\nD a second-hand tractor\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nHeavy rain caused floods in an area of a country.\n\nWhat may be an opportunity cost of repairing the damage caused?\nA the allocation of government funds to the area instead of on a new airport\nB the cost of providing shelter for those made homeless\nC the decline in the tourist industry in the area\nD the loss of profits from businesses affected by the flood\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nIn response to an increase in price from $5 per kilo to $6 per kilo a chicken farmer increased\nsupply from 400 kilos to 500 kilos per week.\n\nWhat is the price elasticity of supply?\nA 0.8\nB 0.9\nC 1.2\nD 1.25\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nA bee-keeper maintains hives of bees to produce honey. The bees can pollinate neighbours\u2019 fruit\ntrees but also give a painful sting to gardeners.\n\nIf both of these events occur, how will costs and benefits be affected?\nA External benefits will fall and social costs will fall.\nB External costs will rise and social benefits will fall.\nC Social costs and social benefits will fall.\nD Social costs and social benefits will rise.\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nIn 2015 there was a significant fall in the world price of petrol (gasoline).\n\nWhat would not have been a cause of the price fall?\nA the continuing global recovery from the world economic recession\nB the increasing exploitation of US oil reserves\nC the re-entry of Iranian producers to the world oil market\nD the shorter journeys from using the new Suez Canal\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nWhich statement about financial matters is correct?\nA Commercial banks\u2019 main activity is the finance of international trade.\nB Paper banknotes possess all the desirable properties needed to act as money.\nC Stock exchanges trade mainly in second-hand stocks and shares.\nD The central bank acts as the lender of last resort to companies facing bankruptcy.\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nWhat is most likely to be used to support a claim for wage increases in an industry?\nA a decrease in the industry\u2019s sales\nB a decrease in the need for specialist training\nC an increase in cheap imports of a rival product\nD an increase in wages in a similar industry\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: The government increases the rate of income tax and decreases the rate of a sales tax (VAT).\n\nFrom the initial equilibrium point of X, which letter indicates the new equilibrium point in a market\nfor normal goods?\n\nO price\nquantity\nD1\nS1\nS S2\nD2\nD A\nB C\nD X\n\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: In South Africa, the number of skilled workers is relatively low. However, average wages in South\nAfrica are double the average wage in Brazil and Turkey and they are 1.6 times higher than in\nMalaysia.\n\nWhat may be concluded from this information?\nA Malaysian workers are more skilled than South African workers.\nB Prices in South Africa are double those in Brazil.\nC South Africa\u2019s labour productivity is low.\nD South African trade union bargaining power is strong.\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: To achieve horizontal integration, a firm producing tyres could merge with another firm producing\nA motor cars.\nB rubber.\nC tyre-producing machinery.\nD tyres.\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: Which costs will necessarily fall continuously as output increases?\nA average fixed costs\nB average variable costs\nC opportunity costs\nD repayment costs of borrowing\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: A monopoly takes over an industry from competitive firms.\n\nWhat is not likely to be true about a monopoly compared with a competitive firm?\nA A monopoly will earn a higher rate of profit.\nB A monopoly will gain a greater share of the market.\nC A monopoly will offer a wider choice to the consumer.\nD A monopoly will operate on a larger scale of production.\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: When is a tax progressive?\nA when some goods have a higher tax than others\nB when the rate of tax increases as income increases\nC when the tax is linked to the rate of inflation\nD when the tax is on incomes rather than on goods or services\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: A government wishes to try to make the distribution of income in the country more equal.\n\nWhich policy would be most likely to achieve this?\nA reducing housing subsidies\nB reducing indirect tax on food\nC reducing inheritance tax\nD reducing tax on the dividends on stocks and shares\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: In trying to achieve one of its aims a government may make it difficult to achieve another aim.\n\nWhat is an example of this conflict?\nA Achieving a more even distribution of income may prevent a rise in the average standard of\nliving.\nB Achieving an increase in economic growth may prevent full employment.\nC Achieving full employment may prevent stable prices.\nD Achieving stable prices may prevent a current account surplus on the balance of payments.\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: Which policy combination will be the most effective if a government wishes to increase the level\nof employment?\nA decrease general taxation and decrease the rate of interest\nB decrease general taxation and increase the rate of interest\nC increase general taxation and decrease the rate of interest\nD increase general taxation and increase the rate of interest\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: A newspaper reported that a country\u2019s economy had grown by 3% during the last year.\n\nWhat must have increased in that year?\nA costs of production\nB gross domestic product\nC unemployment\nD wage levels\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: What is meant by deflation?\nA a fall in the general price level\nB a fall in the international value of a currency\nC a fall in the rate of inflation\nD a fall in the real value of money\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: The information below refers to an economy for a financial year.\n\ngovernment expenditure\n= $2866 million\ngovernment revenue\n= $1940 million\n\nWhat was the budget balance of the government in that year?\nA $926 million in deficit\nB $4806 million in deficit\nC $926 million in surplus\nD $4806 million in surplus\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: What is the change in GDP per head, after taking account of price increases (real change),\nbetween 2000 and 2013?\n\nyear\npopulation\nmillion\nconsumer prices\nindex (CPI)\nGDP $billion\n2000\n3 100\n4000\n2013\n4 120\n6000\n\nA from $15 to $125\nB from $1250 to $1333\nC from $1333 to $1250\nD from $1333 to $1500\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: Which statement about the poorest families in developing economies is not likely to be correct?\nA The children will be expected to work to help provide income.\nB The family will find it easy to obtain loans to develop their farms.\nC The family will have a low earning capacity.\nD The family will suffer from malnutrition and lack of medical care.\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: Which government policy is most likely to increase the volume of exports?\nA devaluation\nB embargoes\nC quotas\nD tariffs\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: What might encourage international specialisation between countries?\nA free trade\nB inefficiencies in production\nC labour immobility\nD tariffs\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: In 2015, Russia banned the imports of food, such as milk, from the European Union (EU).\n\nWhich outcomes are most likely to happen as a result?\n\n\nmilk market\nin Europe\nprice of milk\nin Russia\nprofits of\nEU farmers\nA excess demand\nfall\nrise\nB excess demand\nrise\nrise\nC excess supply\nfall\nfall\nD excess supply\nrise\nfall\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: In 2010, Vietnam experienced a deficit in the value of its trade in goods (visible) despite exporting\na greater number of goods than it imported.\n\nWhat could explain this?\nA The average price of its goods imported exceeded the average price of its goods exported.\nB The average value of its goods exported exceeded the average value of its goods imported.\nC The country had a deficit on its trade in services.\nD The country\u2019s government imposed tariffs on imports.\n\n\nBLANK PAGE\nBLANK PAGE\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nWhich statement about factors of production is correct?\nA The fruit picked from the tree is called land.\nB The managers of a company are called enterprise.\nC The money used to finance a project is called capital.\nD The owner of a company is called labour.\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nA person can make 10 items to sell on a craft stall in a day.\n\nWhat is the opportunity cost if the person decides to paint a picture instead?\nA 10 craft items\nB the cost of the materials for the craft items\nC the cost of the paint for the picture\nD the value of the picture\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \n15\n2 3\n1 4\n\nWho has the most elastic demand for t-shirts when the price rises from $10 to $15?\nA Elsa\nB George\nC Hamid\nD Shara\n\n\n5 The diagram shows the demand for chocolate.\n\nO quantity demanded\nper week\nprice\nD X\nY \n\nWhat could cause the movement from point X to point Y?\nA a change in tastes\nB a fall in the price of chocolate\nC an increase in income\nD a successful advertising campaign for chocolate\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nA company produces an electric car that can be driven much further than other electric cars\nwithout needing recharging. The car does not emit the dangerous fumes that petrol cars do. The\nbatteries that power the car are very expensive and the company is building a huge factory to\nproduce batteries more cheaply.\n\nWhich concepts can be applied to the above statement?\nA average cost and mergers\nB external costs and mixed economy\nC private costs and economies of scale\nD public sector and market failure\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nA student needs to borrow $60 000 to pay for a five-year university course in medicine.\n\nWhat would motivate the student to borrow to pay for the course?\nA Debts must be repaid within the first five years of work.\nB Further training in hospitals must follow graduation.\nC High earnings are expected in the long-run.\nD Many skills gained on the course are non-transferable.\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nThe Congress of South African Trade Unions (COSATU) is the biggest union federation in South\nAfrica. It represents public sector workers.\n\nIn 2010, it had an increase in membership. In the same year, COSATU\u2019s bargaining strength\ndeclined.\n\nWhat could explain this?\nA There was an increase in government spending on welfare payments.\nB There was an increase in the country\u2019s unemployment rate.\nC There was an increase in the geographical mobility of labour.\nD There was an increase in union funds.\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: Which worker is most likely to risk facing a falling income towards the end of their career?\nA a manager in an engineering firm\nB a manual worker in a building firm\nC a supervisor in a retail firm\nD an office worker in an advertising firm\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: What is the most likely reason why airline pilots earn more than agricultural workers?\nA Agricultural work is difficult.\nB Pilots work regular hours.\nC There is a surplus of agricultural workers.\nD There is no shortage of pilots.\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: To achieve horizontal integration, a firm producing tyres could merge with another firm producing\nA motor cars.\nB rubber.\nC tyre-producing machinery.\nD tyres.\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: A car manufacturer has a highly mechanised assembly line using robots and a few skilled\nworkers. An international exam board employs many thousands of examiners to mark candidates\u2019\nexamination papers.\n\nWhich row describes each of these activities?\n\n\ncar manufacturer\ninternational exam board\nA capital-intensive\ncapital-intensive\nB capital-intensive\nlabour-intensive\nC labour-intensive\ncapital-intensive\nD labour-intensive\nlabour-intensive\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: A monopoly takes over an industry from competitive firms.\n\nWhat is not likely to be true about a monopoly compared with a competitive firm?\nA A monopoly will earn a higher rate of profit.\nB A monopoly will gain a greater share of the market.\nC A monopoly will offer a wider choice to the consumer.\nD A monopoly will operate on a larger scale of production.\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: When is a tax progressive?\nA when some goods have a higher tax than others\nB when the rate of tax increases as income increases\nC when the tax is linked to the rate of inflation\nD when the tax is on incomes rather than on goods or services\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: Why can government spending be described both as a fiscal policy and a supply-side policy?\nA It has a nationwide effect and can control firms\u2019 production possibility curves.\nB It is announced in the budget and can increase the economy\u2019s ability to produce.\nC It is determined by the central bank and can raise the cost of production of firms.\nD It must equal tax revenue and can regulate the amount of the money supply.\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: In trying to achieve one of its aims a government may make it difficult to achieve another aim.\n\nWhat is an example of this conflict?\nA Achieving a more even distribution of income may prevent a rise in the average standard of\nliving.\nB Achieving an increase in economic growth may prevent full employment.\nC Achieving full employment may prevent stable prices.\nD Achieving stable prices may prevent a current account surplus on the balance of payments.\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: A government cuts the rate of income tax.\n\nWhat effect is this likely to have on tax evasion and revenue from indirect taxes?\n\n\ntax evasion\nrevenue from\nindirect taxes\nA decrease\nincrease\nB decrease\nno effect\nC increase\nincrease\nD increase\nno effect\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: A newspaper reported that a country\u2019s economy had grown by 3% during the last year.\n\nWhat must have increased in that year?\nA costs of production\nB gross domestic product\nC unemployment\nD wage levels\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: In the poorest developing countries it is difficult to measure the size of GDP.\n\nWhat is the main cause of this?\nA A high proportion of the paid workforce is in the informal sector.\nB Employment in rural areas is seasonal in nature.\nC The provision of services cannot be given a value.\nD Women are discriminated against in many jobs.\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: The information below refers to an economy for a financial year.\n\ngovernment expenditure\n= $2866 million\ngovernment revenue\n= $1940 million\n\nWhat was the budget balance of the government in that year?\nA $926 million in deficit\nB $4806 million in deficit\nC $926 million in surplus\nD $4806 million in surplus\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: What is likely to show that a country has a rising level of economic development?\nA a reduced inflation rate\nB a reduced national income per head\nC a reduced provision of healthcare (merit good)\nD a reduced unemployment rate\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: A government in a developing country has given extra funds to promote trade in rural areas by\nencouraging the establishment of small shops.\n\nWhat is likely to increase as a result?\nA primary industry in the private sector\nB primary industry in the public sector\nC secondary industry in the public sector\nD tertiary industry in the private sector\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: Which government policy is most likely to increase the volume of exports?\nA devaluation\nB embargoes\nC quotas\nD tariffs\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: Which method would both reduce imports and encourage exports?\nA embargoes on dangerous products\nB quotas on agricultural produce\nC subsidies on locally-produced electronics\nD tariffs on iron and steel products\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: The currency exchange rate of the South African rand for the Botswana pula fell by 5.7%\nbetween August 2014 and August 2015.\n\nWhat would be the immediate effect of this?\nA Botswana\u2019s level of protection would fall.\nB Botswana\u2019s tourists travelling to South Africa would find it less expensive.\nC South Africa\u2019s imports would be cheaper.\nD South Africa\u2019s tourists travelling to Botswana would receive more pula per rand.\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: In 2015, China was the world\u2019s biggest importer of oil. In August 2015, China devalued its\ncurrency.\n\nWhat is likely to have happened?\nA The price of China\u2019s exports fell and world oil prices rose as China\u2019s demand decreased.\nB The price of China\u2019s exports rose and world oil prices fell as China\u2019s demand increased.\nC The price of China\u2019s imports fell and world oil prices rose as China\u2019s demand increased.\nD The price of China\u2019s imports rose and world oil prices fell as China\u2019s demand decreased.\n\n\nBLANK PAGE\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nThe Norwegian government chose to spend the profits from oil on stocks, bonds and property.\nThe possibility of improving domestic infrastructure, therefore, was not taken.\n\nWhich economic concept does this best illustrate?\nA cost of production\nB finite resources\nC opportunity cost\nD production possibility frontier\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nWhat would be classified by an economist as the factor of production known as land?\nA a discovery of oil in the South China sea\nB an oil rig bought by an oil company\nC money held by the oil companies in their bank accounts\nD the productivity of oil workers\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nWhat is the cause of the economic problem facing all countries?\nA climate change and global warming\nB significant quantities of unemployed resources\nC uneven distribution of income and wealth\nD unlimited wants in relation to limited resources\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nWhich activity takes place in the tertiary sector?\nA assembling computers\nB giving legal advice\nC harvesting grain\nD making bread\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nA government approved the construction of a new railway line connecting major cities. It would be\nbuilt by a private company but be funded partly through taxation. It would create many jobs.\nPeople living on the route worried about the harm to their environment.\n\nWhich concepts are directly involved in this statement?\nA excess demand and public corporation\nB government subsidies and perfect competition\nC market system and income distribution\nD private benefit and external cost\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nWhat is a function of a central bank?\nA accepting deposits from the public\nB determining tax rates\nC implementing monetary policy\nD lending to businesses\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nWhat is likely to lead to an increase in the wages of university lecturers?\nA an increase in the fringe benefits provided to university lecturers\nB an increase in the tuition fees paid by university students\nC government policies reducing the length of the training for university lecturers\nD increased demand from students to study at university\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: When is a trade union likely to have more power to increase its members\u2019 wages?\nA when imports are increasing\nB when labour supply is increasing\nC when output is increasing\nD when unemployment is increasing\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: Which characteristic can exist both in monopoly and in perfect competition?\nA freedom of entry\nB many buyers\nC many sellers\nD perfectly elastic demand curve\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: An industry is experiencing diseconomies of scale.\n\nWhat will be happening to long run average cost and total cost?\n\n\nlong run\naverage cost\ntotal cost\nA decreasing\ndecreasing\nB decreasing\nincreasing\nC increasing\ndecreasing\nD increasing\nincreasing\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: A firm that sells its product for $6 a unit has the following total costs.\n\noutput (units)\n0 10\n20\n30\ntotal costs ($)\n40\n100\n120\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: 0\n\nWhich statement is correct?\nA Average cost is lowest when 10 units are produced.\nB The firm does not make any profit when 20 units are sold.\nC The firm has no fixed costs.\nD Total variable costs fall continuously over these outputs.\n\n\n15 Which statement about fixed costs is correct?\nA They exist only in the long run.\nB They include raw material and direct labour costs.\nC They increase at the same rate as output.\nD They must be paid even if there is no output.\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: What would a government reduce as part of an expansionary monetary policy to increase\nemployment?\nA government spending\nB the money supply\nC the rate of interest\nD unemployment benefit\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: What is an aim of government policy?\nA income tax\nB interest rates\nC stable prices\nD unemployment\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: Which situation involving the building industry is most likely to be investigated by a government\nbody set up to control restrictive practices?\nA a builder purchasing a plot of land for development of housing\nB groups of suppliers of building materials agreeing to fix prices\nC several builders bidding for the same contracts\nD several builders using different sources of supply\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: An economy is experiencing two consecutive quarters of negative economic growth.\n\nWhat is this economy experiencing?\nA budget deficit\nB inflation\nC recession\nD trade deficit\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: What is included in the calculation of a consumer prices index (CPI)?\nA the price of a basket of goods and services\nB the price of exports and the price of imports\nC the value of the currency on international markets\nD the wages of consumers\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: There was a fall in investment spending by businesses in the third quarter of 2015.\n\nWhat would be the likely result of this?\nA an increase in economic growth\nB an increase in exports\nC an increase in incomes\nD an increase in unemployment\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: What is found in a typical developed country?\nA fast rate of economic growth\nB high population growth\nC limited use of technology\nD significant tertiary employment\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: Which characteristic will show that a country has significant absolute poverty?\nA A majority of the population will have less than average income.\nB Basic living needs are not being met.\nC Most people do not have mobile phones.\nD There is a high number of people living in rural areas.\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: The government of a developing country allows a multinational mining company to mine minerals\nin order to improve the standard of living of the local people.\n\nWhich action by the multinational company (MNC) will not lead to an improvement in the\nstandard of living of the local people?\nA building roads to assist transport\nB exporting mineral ore\nC providing skills training\nD returning profits overseas\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: A country has decided that it wants to increase free trade with its trading partners.\n\nWhich measure would help it achieve this objective?\nA a higher quota on imported cars\nB a subsidy to domestic car producers\nC an embargo on cars produced in other countries\nD higher tariffs on imported goods\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: In 2012 the UK held the Olympic Games, which attracted a large number of visitors from foreign\ncountries.\n\nWhich item of the UK\u2019s current account balance will have benefited directly from this event?\nA export trade in goods\nB export trade in services\nC import trade in goods\nD import trade in services\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: The Mexican currency (the peso) has fallen in value against the US dollar.\n\nWhat will be the effect of this on the Mexican economy?\nA a decrease in tariffs on imports\nB a decrease in the price of exports\nC a decrease in the price of imports\nD a decrease in the volume of exports\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nIn economics, natural sunlight is classified as a free good.\n\nWhat is the reason for this?\nA Sunlight is a gift of nature.\nB Sunlight is a renewable resource.\nC There is no opportunity cost of using sunlight.\nD Unlimited amounts of sunlight can be consumed.\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nWhat would be classified as the factor of production capital for an airline?\nA the aircraft operated by the airline\nB the money the airline keeps in the bank\nC the pilots the airline uses\nD the shares of the airline quoted on the stock market\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nWhat is a major advantage of a market economic system over a mixed economic system?\nA All production of goods and services is determined by consumer demand.\nB Ownership of resources is divided between private and public sectors.\nC Producers include any external costs they create in the price of the good.\nD There will always be an even distribution of income and wealth.\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nWhat does a commercial bank not provide?\nA cash\nB bonds\nC loans\nD mortgages\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nWhat will be likely to increase the wages of airline pilots?\nA Incomes increase in the world\u2019s major economies.\nB Terrorist attacks decrease tourist travel.\nC The cost of aviation fuel rises.\nD The world economy goes into recession.\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: What is most likely to help a trade union\u2019s claim for wage increases in an industry?\nA a decrease in the price of a close substitute for the product\nB a decrease in the qualifications needed for the job\nC an increase in the number of workers\nD an increase in the profits of the industry\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: What is a characteristic of a perfectly competitive firm?\nA absence of competitors\nB non-price competition\nC one dominant firm\nD price taker\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: What is a possible cause of diseconomies of scale?\nA an increase in extra administration\nB an increase in raw materials costs\nC an increase in taxation on company profits\nD an increase in the national minimum wage\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: A firm that sells its product for $6 a unit has the following total costs.\n\noutput (units)\n0 10\n20\n30\ntotal costs ($)\n40\n100\n120\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: 0\n\nWhich statement is correct?\nA Average cost is lowest when 10 units are produced.\nB The firm does not make any profit when 20 units are sold.\nC The firm has no fixed costs.\nD Total variable costs fall continuously over these outputs.\n\n\n15 Which statement about fixed costs is correct?\nA They exist only in the long run.\nB They include raw material and direct labour costs.\nC They increase at the same rate as output.\nD They must be paid even if there is no output.\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: Which is a supply-side policy?\nA increasing interest rates\nB increasing taxation\nC providing training courses\nD selling government bonds\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: What is an aim of government policy?\nA income tax\nB interest rates\nC stable prices\nD unemployment\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: A government has the following revenue.\n\n\nrevenue\n($ m)\ncorporation profits tax\n20\ninheritance tax\n30\nduty on imports\n40\nincome tax\n50\nsales tax (VAT)\n200\n\nWhat is the total amount of indirect tax revenue?\nA $140 m\nB $200 m\nC $240 m\nD $270 m\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: Which situation involving the building industry is most likely to be investigated by a government\nbody set up to control restrictive practices?\nA a builder purchasing a plot of land for development of housing\nB groups of suppliers of building materials agreeing to fix prices\nC several builders bidding for the same contracts\nD several builders using different sources of supply\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: What determines the weights in the consumer prices index (CPI)?\nA the average income received by the various households\nB the average increase in the prices of the different goods\nC the proportion of income spent by the average household on particular goods\nD the proportion of income that the average household saves\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: There was a fall in investment spending by businesses in the third quarter of 2015.\n\nWhat would be the likely result of this?\nA an increase in economic growth\nB an increase in exports\nC an increase in incomes\nD an increase in unemployment\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: Which feature is found in a developed country rather than a developing country?\nA high levels of rural to urban migration\nB highly organised international financial markets\nC low proportion of workforce in service industries\nD low school-leaving age\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: Over two-thirds of the world\u2019s poorest people live in rural areas. They are mainly involved in\nsubsistence agriculture.\n\nWhat explains why poverty remains at a high level for subsistence farming families?\nA a lack of finance to buy machinery to improve productivity\nB low international prices for food due to overproduction\nC the size of families is too small to work the land\nD women are discouraged from doing agricultural work\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: The government of a developing country allows a multinational mining company to mine minerals\nin order to improve the standard of living of the local people.\n\nWhich action by the multinational company (MNC) will not lead to an improvement in the\nstandard of living of the local people?\nA building roads to assist transport\nB exporting mineral ore\nC providing skills training\nD returning profits overseas\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: A country wishes to follow a policy of trade protection.\n\nWhich action would it take?\nA increase the level of import quotas\nB reduce import tariffs\nC remove exchange controls\nD subsidise export producers\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: In 2012 the UK held the Olympic Games, which attracted a large number of visitors from foreign\ncountries.\n\nWhich item of the UK\u2019s current account balance will have benefited directly from this event?\nA export trade in goods\nB export trade in services\nC import trade in goods\nD import trade in services\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: In 2015, the value of the South African currency (the rand) depreciated against the US dollar.\n\nWhat effect did this have on the US economy?\nA Exports to South Africa became more expensive.\nB The current account deficit of the US decreased.\nC The US experienced higher levels of inflation.\nD Unemployment in the US decreased.\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nThe introduction of robots has meant that many firms now require fewer workers to produce their\ngoods and services.\n\nAccording to this statement, which factor of production is replacing workers?\nA capital\nB enterprise\nC labour\nD land\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nEconomics textbooks identify the existence of scarcity as the basic economic problem.\n\nWhat is it that makes scarcity a problem?\nA It can cause inflation and unemployment.\nB It is impossible to satisfy unlimited wants.\nC It is the first priority of governments.\nD It only affects the richest countries.\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nWhat is a benefit of the free market system?\nA Innovation is encouraged to increase profits.\nC Negative externalities can be controlled.\nB Subsidies can be used to encourage exports.\nD The distribution of goods and services is fair.\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nA private firm is one of a few suppliers of electricity in an economy. It is fined by the government\nfor pollution from its coal-fired power stations which affect the health of those living nearby.\n\nWhat does this situation involve?\nA a government policy of nationalising an electricity supplier\nB a market structure for electricity that is perfect competition\nC a monopoly electricity supplier that ignores government controls\nD external costs that are the result of electricity production\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nWhat is not a function of a central bank?\nA It is the lender of last resort to financial institutions.\nB It is the sole issuer of notes and coins.\nC It lends to individual firms and consumers.\nD It manages the national debt for the government.\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nWhich change will make a manufacturing company replace labour with capital to maintain the\nmost efficient combination of factors of production?\nA The price of machinery has increased.\nB The productivity of labour has increased.\nC The productivity of machinery has increased.\nD The supply of labour has increased.\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: What is the most likely reason a firm might welcome the introduction of a trade union for its\nworkers?\nA Unions advise on the level of company dividends.\nB Unions press for higher minimum wage rates.\nC Unions simplify the process of wage bargaining.\nD Unions wish to operate labour-intensive production methods.\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: What is least likely to lead to an increase in consumer spending on a new car?\nA a decrease in the cost of car repairs\nB a decrease in the price of petrol\nC a decrease in the rate of interest\nD a decrease in train fares\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: What is a characteristic of perfect competition?\nA Firms sell an identical product.\nB New firms cannot enter the market.\nC The market is controlled by one firm.\nD There is a high degree of market concentration.\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: A television manufacturer claims to have the most technically advanced production in the\nindustry.\n\nWhat is this most likely to mean when compared with its rival producers?\nA It has a greater share of the television market.\nB It is a more diversified company.\nC It is less likely to be disrupted by strike action.\nD It needs a more highly skilled workforce.\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: A firm that sells its product for $6 a unit has the following total costs.\n\noutput (units)\n0 10\n20\n30\ntotal costs ($)\n40\n100\n120\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: 0\n\nWhich statement is correct?\nA Average cost is lowest when 10 units are produced.\nB The firm does not make any profit when 20 units are sold.\nC The firm has no fixed costs.\nD Total variable costs fall continuously over these outputs.\n\n\n15 Which statement about fixed costs is correct?\nA They exist only in the long run.\nB They include raw material and direct labour costs.\nC They increase at the same rate as output.\nD They must be paid even if there is no output.\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: In many countries the government provides financial help to firms who wish to produce electricity\nusing wind turbines.\n\nWhich kind of policy measure is this?\nA deregulation\nB maximum price\nC subsidy\nD taxation\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: What is an aim of government policy?\nA income tax\nB interest rates\nC stable prices\nD unemployment\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: A government seeks to redistribute income from the rich to the poor.\n\nWhich combination of policy measures is most likely to achieve this aim?\n\n\nincome tax\nsales tax\nstate benefit\nA decrease\ndecrease\ndecrease\nB decrease\nincrease\nincrease\nC increase\ndecrease\nincrease\nD increase\nincrease\ndecrease\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: Which situation involving the building industry is most likely to be investigated by a government\nbody set up to control restrictive practices?\nA a builder purchasing a plot of land for development of housing\nB groups of suppliers of building materials agreeing to fix prices\nC several builders bidding for the same contracts\nD several builders using different sources of supply\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: What is a likely consequence of economic growth?\nA decreased levels of employment\nB decreased levels of exports\nC decreased levels of output\nD decreased levels of poverty\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: A basket of goods is used to calculate a country\u2019s rate of inflation.\n\nWhat is included in the basket of goods?\nA a representative sample of current household spending\nB all goods bought in the country\nC the spending on an unchanging group of necessities\nD the 50 most popular items of household spending\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: There was a fall in investment spending by businesses in the third quarter of 2015.\n\nWhat would be the likely result of this?\nA an increase in economic growth\nB an increase in exports\nC an increase in incomes\nD an increase in unemployment\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: Provision of services in rural districts of developing countries tends to occur later than those in\nurban areas.\n\nFor which service would this not be correct?\nA medical research units\nB mobile phone networks\nC modern transport systems\nD university teaching departments\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: The government of a developing country allows a multinational mining company to mine minerals\nin order to improve the standard of living of the local people.\n\nWhich action by the multinational company (MNC) will not lead to an improvement in the\nstandard of living of the local people?\nA building roads to assist transport\nB exporting mineral ore\nC providing skills training\nD returning profits overseas\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: What would have the most severe restriction on the volume of international trade in steel?\nA an embargo\nB a licence system\nC a quota\nD a tariff\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: In 2012 the UK held the Olympic Games, which attracted a large number of visitors from foreign\ncountries.\n\nWhich item of the UK\u2019s current account balance will have benefited directly from this event?\nA export trade in goods\nB export trade in services\nC import trade in goods\nD import trade in services\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nWhat is an example of the purchase of a consumer good?\nA A farm owner buys a television.\nB A farm owner buys additional land.\nC A farm owner buys fertiliser for their crops.\nD A farm owner buys some farming equipment.\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nWhat is the function of the factors of production in an economy?\nA to make goods and services to fulfil wants and needs\nB to provide an even distribution of income\nC to provide tax income for the government\nD to reduce the existence of external costs\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nWhich topic is included in microeconomics?\nA economic growth\nB elasticity of demand\nC inflation\nD the balance of payments\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nWhat aspect of demerit goods means they are overproduced?\nA clear product information\nB high external costs\nC high product taxes\nD low customer demand\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nLithium is an essential metal for the production of electric cars. Following a 10% increase in the\nprice of lithium, supplies increase by 15%. This led to a 5% increase in the price of\nelectric cars.\n\nWhat is the price elasticity of supply (PES) for lithium?\nA 0.33\nB 0.66\nC 1.50\nD 2.0\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nThe wage of labour in a firm increases.\n\nWhat is the most likely effect on the production process?\nA Capital replaces labour immediately.\nB Capital replaces labour in the long run.\nC Labour replaces capital immediately.\nD Labour replaces capital in the long run.\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nWhich combination of influences would increase the level of borrowing by a household?\n\n\ninfluence 1\ninfluence 2\nA becoming pensioners\nhigher rate of inflation\nB greater wealth\nlower consumer confidence\nC higher consumer confidence\nlower rate of interest\nD higher rate of interest\ngreater availability of credit\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: People\u2019s income decreases.\n\nHow is the proportion spent on food and leisure likely to change?\n\n\nfood\nleisure\nA decrease\ndecrease\nB decrease\nincrease\nC increase\ndecrease\nD increase\nincrease\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: The following information refers to a firm producing shoes.\n\nAt which level of output does the firm maximise profits?\n\n\ntotal output of\npairs of shoes\ntotal cost\n($)\ntotal revenue\n($)\nA 100\n1000\n1300\nB 200\n1800\n2200\nC 300\n2700\n3000\nD 400\n3200\n3400\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: What is most likely to lead to an improvement in labour productivity in an industry?\nA an increase in capital investment\nB an increase in income tax rates\nC an increase in the demand for the industry\u2019s product\nD an increase in the number of firms in the industry\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: How is a government most likely to prevent the growth of monopolies?\nA by encouraging mergers in the private sector\nB by establishing nationalised industries\nC by promoting the benefits of economies of scale\nD by reducing barriers to entry into an industry\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: What is not included in public expenditure?\nA capital spending by firms\nB interest payments on government borrowing\nC investment in defence by the central government\nD subsidies to bus companies from local government\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: When is the budget described as balanced?\nA when direct taxes and indirect taxes are equal\nB when exports and imports are equal\nC when government spending and government revenue are equal\nD when the demand for money and the supply of money are equal\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: The government wishes to increase economic growth in its economy.\n\nWhat would not be likely to achieve this aim?\nA The central bank encourages bank lending.\nB The central bank lowers interest rates.\nC The government increases sales tax (VAT).\nD The government subsidises new industries.\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: The government redistributes income more evenly.\n\nWhat is most likely to increase?\nA the incentive to work\nB the level of savings\nC the need for welfare payments\nD the rate of inflation\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: What may directly cause economic growth?\nA higher imports\nB higher levels of resources\nC higher taxation\nD higher unemployment\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: What would not be required in the construction of an index of consumer prices?\nA the selection of a base year\nB the selection of a representative range of items\nC the calculation of average wage levels\nD the weighting of each item in the index\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: What distinguishes a more developed country from a less developed country?\nA Inflation rates are higher in the more developed country.\nB Interest rates are higher in the more developed country.\nC Natural resources are higher in the more developed country.\nD Real incomes are higher in the more developed country.\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: An additional 700 000 UK children and pensioners fell into relative poverty between 2013 and\n2017.\n\nWhat might be the reason for this?\nA Direct taxes had increased, and indirect taxes had fallen.\nB Real gross domestic product was rising faster than the population.\nC The death rate was exceeding the birth rate.\nD The real value of government welfare benefits had fallen.\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: Which changes usually result when a country develops and is able to provide free healthcare and\ngood living conditions?\n\n\nbirth rate\ndeath rate\nlabour\nproductivity\nA falls\nfalls\nrises\nB falls\nrises\nfalls\nC rises\nfalls\nfalls\nD rises\nrises\nrises\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: What is a quota in international trade?\nA a government grant to encourage production\nB an administrative and technical barrier\nC a limit on the quantity of imports\nD a tax on imports\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: Many low-income countries rely on exports of raw materials such as coffee or iron ore to earn\nthem foreign currency.\n\nWhat is a disadvantage of this?\nA Countries have a constant demand for raw materials.\nB International trade only benefits the importing countries.\nC It is necessary for low-income countries to belong to a free trade area.\nD Raw materials have fluctuating prices.\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: What is included as part of the current account of the balance of payments?\nA all government income and expenditure\nB money withdrawn from a bank account\nC investments in other countries by manufacturers\nD trade in goods and services\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nIn 2016, 20 billion barrels of oil and 1.6 billion barrels of natural gas were discovered in Texas,\nUS.\n\nWhich factor of production has increased in the US due to this discovery?\nA capital\nB enterprise\nC labour\nD land\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nA student decides to take up a two year apprenticeship for which she will earn $10 000 per year.\nAfter that she expects to earn $25 000 per year. She could take an unskilled job which pays\n$16 000 per year instead of the apprenticeship.\n\nWhat is the opportunity cost in the two years of completing the apprenticeship?\nA $10 000\nB $12 000\nC $25 000\nD $32 000\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nMicroeconomics analyses choices in various situations.\n\nWhich area of economic study does it not include?\nA costs and revenues of a firm\nB individual consumer behaviour\nC policies for economic growth\nD wages for different occupations\n\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nWhat is a cause of market failure?\nA many firms\nB monopoly\nC profit maximisation\nD specialisation\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nThe price of bread rose by 5% and the quantity demanded fell by 4%.\n\nWhat was the price elasticity of demand for bread?\nA \u20130.4\nB \u20130.8\nC \u20131.25\nD \u20132.0\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nSaudi Arabia specialises in oil extraction and refining. This is a capital-intensive industry with\nhighly skilled labour.\n\nWhat might be a disadvantage of this specialisation?\nA Oil companies have increased training costs as each worker needs many different skills.\nB Oil companies may find it difficult to achieve economies of scale.\nC Resource allocation is not efficient because a narrow range of goods is being produced.\nD Workers may face a restricted range of job opportunities.\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nWhat would most likely cause a person to increase their savings?\nA a decision to plan for retirement\nB a fall in income\nC a fall in interest rates\nD a reduction in tax-free saving schemes\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: People\u2019s income decreases.\n\nHow is the proportion spent on food and leisure likely to change?\n\n\nfood\nleisure\nA decrease\ndecrease\nB decrease\nincrease\nC increase\ndecrease\nD increase\nincrease\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: The following information refers to a firm producing shoes.\n\nAt which level of output does the firm maximise profits?\n\n\ntotal output of\npairs of shoes\ntotal cost\n($)\ntotal revenue\n($)\nA 100\n1000\n1300\nB 200\n1800\n2200\nC 300\n2700\n3000\nD 400\n3200\n3400\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: Which statement proves there has been an increase in productivity for a factory making tractors?\nA 10% more workers results in a 10% increase in tractors produced each week.\nB Output per worker increases from 3 tractors to 4 tractors per month.\nC Production increases as more workers are hired.\nD Starting a night shift leads to an increase in production of 10 tractors a day.\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: When do economies of scale take place?\nA in the short run\nB if variable factors become fixed\nC when all factors of production are fixed\nD when all factors of production are variable\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: What is not included in public expenditure?\nA capital spending by firms\nB interest payments on government borrowing\nC investment in defence by the central government\nD subsidies to bus companies from local government\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: When is the budget described as balanced?\nA when direct taxes and indirect taxes are equal\nB when exports and imports are equal\nC when government spending and government revenue are equal\nD when the demand for money and the supply of money are equal\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: A government increased revenue by increasing taxes on firms.\n\nWhich tax did it increase?\nA inheritance tax\nB profits tax\nC sales tax\nD value added tax\n\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: Why are governments responsible for the defence of the country?\nA It is impossible to charge a price for defence.\nB It prevents individual citizens having access to weapons.\nC Only governments can manufacture weapons.\nD Providing defence is very expensive.\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: Information about job vacancies on a government website has led to a decrease in short-term\nunemployment.\n\nWhat is the term for this type of unemployment?\nA cyclical unemployment\nB frictional unemployment\nC structural unemployment\nD technological unemployment\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: What would not be required in the construction of an index of consumer prices?\nA the selection of a base year\nB the selection of a representative range of items\nC the calculation of average wage levels\nD the weighting of each item in the index\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: Due to war, some people are living in absolute poverty.\n\nWhat is the main indicator of absolute poverty for these people?\nA dependence on aid for medical treatment\nB lack of transport to escape abroad\nC living in tents in temporary camps\nD receiving insufficient food for basic nutrition\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: Which changes usually result when a country develops and is able to provide free healthcare and\ngood living conditions?\n\n\nbirth rate\ndeath rate\nlabour\nproductivity\nA falls\nfalls\nrises\nB falls\nrises\nfalls\nC rises\nfalls\nfalls\nD rises\nrises\nrises\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: There has been an appreciation of the value of a country\u2019s currency against other currencies.\n\nWhat effects will this have on prices of imports of raw materials and prices of exports of\nmanufactured goods?\n\n\nprices of imports of\nraw materials\nprices of exports of\nmanufactured goods\nA cheaper\ncheaper\nB cheaper\nmore expensive\nC more expensive\ncheaper\nD more expensive\nmore expensive\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: What is a disadvantage of increased specialisation by a country?\nA It becomes more reliant on imports to meet all its needs.\nB It reduces the potential for international trade.\nC It results in access to a greater variety of goods for consumers.\nD It results in lower costs for home produced goods.\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nA natural resource was discovered in a country. The exploitation of this resource allowed the\ncountry to double its gross domestic product within ten years.\n\nWhy did this not solve the basic economic problem?\nA Exploiting the resource required high expenditure on capital equipment.\nB Exploiting the resource caused significant environmental damage.\nC Gross domestic product was unevenly distributed in the country.\nD Wants still exceeded the resources available to meet those wants.\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nA farmer decides to grow potatoes instead of wheat.\n\nWhat is the opportunity cost of growing the potatoes?\nA the output of wheat\nB the price of seed potatoes\nC the profit from growing potatoes\nD the time spent preparing the potato field\n\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nWhich are both macroeconomic decisions?\n\n\ndecision 1\ndecision 2\nA a school recruits more teachers\na firm sets the prices for its products\nB a central bank reduces money supply\na government spends more on defence\nC a government increases tax rates\na farmer decides which crops to grow\nD a household cuts its energy use\na worker accepts an offer of overtime\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nWhat is the function of the price mechanism in a market economy?\nA allocating resources and guiding choices\nB allowing governments to provide price stability\nC enabling markets to operate fairly\nD preventing competitors from entering a market\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nThe price elasticity of supply of good X is 0.1. The good suddenly becomes very fashionable,\nleading to a large increase in demand.\n\nWhat would be the likely outcome of this change in the short term?\nA a large increase in output\nB a large increase in price\nC a small increase in price\nD a small increase in revenue\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nWhat is a disadvantage to employers of switching to production using division of labour?\nA average cost decreases\nB flexibility of workers is lost\nC repetition of tasks saves time\nD training time decreases\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nWhat is an advantage to a country of having an efficient commercial banking system?\nA It controls the money supply.\nB It discourages spending.\nC It encourages tax evasion.\nD It enables investment.\n\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: People\u2019s income decreases.\n\nHow is the proportion spent on food and leisure likely to change?\n\n\nfood\nleisure\nA decrease\ndecrease\nB decrease\nincrease\nC increase\ndecrease\nD increase\nincrease\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: A firm produces 1000 units and has a total cost of $50 000. The variable cost per unit produced is\n$40.\n\nWhat is the total fixed cost of the firm?\nA $1000\nB $4000\nC $10 000\nD $40 000\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: The following information refers to a firm producing shoes.\n\nAt which level of output does the firm maximise profits?\n\n\ntotal output of\npairs of shoes\ntotal cost\n($)\ntotal revenue\n($)\nA 100\n1000\n1300\nB 200\n1800\n2200\nC 300\n2700\n3000\nD 400\n3200\n3400\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: Firms can grow by increasing the internal scale of their operations.\n\nWhat might be a disadvantage of this to the firm?\nA average cost begins to fall\nB it is difficult to motivate workers\nC labour is replaced by robots\nD markets become global\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: A government owns and runs an airline.\n\nWhich combination of ownership and sector is this?\n\n\nownership\nsector\nA private\nsecondary\nB private\ntertiary\nC public\nsecondary\nD public\ntertiary\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: What is not included in public expenditure?\nA capital spending by firms\nB interest payments on government borrowing\nC investment in defence by the central government\nD subsidies to bus companies from local government\n\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: When is the budget described as balanced?\nA when direct taxes and indirect taxes are equal\nB when exports and imports are equal\nC when government spending and government revenue are equal\nD when the demand for money and the supply of money are equal\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: What is the main aim of supply-side policy?\nA increasing economic growth by raising productivity\nB increasing the balance of payments surplus by restricting free trade\nC reducing the government\u2019s budget deficit by increasing taxation\nD reducing the money supply by increasing the rate of interest\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: A country has full employment.\n\nWhich policy is most likely to lead to a fall in economic growth in the short run but an increase in\neconomic growth in the long run?\nA lowering the retirement age\nB raising the school leaving age\nC restricting the immigration of key workers\nD selling assets owned in other countries\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: A government has a contractionary fiscal policy to reduce inflation. What will the government\nincrease?\nA expenditure on infrastructure\nB income tax rates\nC personal tax allowances\nD unemployment benefits\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: What would not be required in the construction of an index of consumer prices?\nA the selection of a base year\nB the selection of a representative range of items\nC the calculation of average wage levels\nD the weighting of each item in the index\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: Real incomes have risen in a country.\n\nWhich situation would definitely have caused this?\n\n\nprice level\nmoney\nincomes\nA fell\nfell\nB fell\nrose\nC rose\nrose\nD rose\nfell\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: In recent years some low-income countries have achieved higher rates of economic growth than\nhigh-income countries.\n\nWhat is most likely to explain this accelerated economic growth?\nA ease of transfer of modern technology to increase productivity\nB falling agricultural prices\nC higher ratios of labour to capital in manufacturing industries\nD increased trade barriers by high-income countries\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: Which changes usually result when a country develops and is able to provide free healthcare and\ngood living conditions?\n\n\nbirth rate\ndeath rate\nlabour\nproductivity\nA falls\nfalls\nrises\nB falls\nrises\nfalls\nC rises\nfalls\nfalls\nD rises\nrises\nrises\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: What are the effects on price and equilibrium quantity of the imposition of an import tariff on a\ngood?\n\n\nprice\nequilibrium quantity\nA decreases\ndecreases\nB decreases\nincreases\nC increases\ndecreases\nD increases\nincreases\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: Which change will not increase a surplus on the current account of the balance of payments of a\ncountry?\nA a decrease in the value of imports\nB a decrease in primary income outflows\nC an increase in the amount of development aid received\nD an increase in domestic inflation rates\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: An economy with a floating exchange rate experiences an increased deficit on the current\naccount of the balance of payments.\n\nWhat will result from this?\nA an increase in government debt\nB an increase in its foreign currency reserves\nC an increase in the demand for its currency on the foreign exchange market\nD an increase in the supply of its currency on the foreign exchange market\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nWhich statement about the factors of production is correct?\nA Capital is a financial resource and includes savings in banks.\nB Enterprise is limited in supply and includes office workers.\nC Labour is a human resource and includes pensioners and children.\nD Land is a natural resource and includes trees and fish.\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nA builder spends one hour travelling to and from work. He works 40 hours per week for $200. He\nis given a choice to work 50 hours a week for an extra $75.\n\nWhat would be the opportunity cost to the builder of working the extra hours?\nA the ability to increase his purchasing power\nB the additional time travelling to and from work\nC the increased hourly earnings of $7.50\nD the ten hours of leisure time\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nWhat is included in microeconomics?\nA the calculation of national income and expenditure\nB the effects of a change in exchange rates on the trade balance of an economy\nC the effects of an increase in the price of a good or service\nD the factors leading to demand-pull inflation\n\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nWhat is an economist\u2019s definition of a market?\nA a collection of informal retail outlets run by small firms\nB a place where traders gather regularly for short periods\nC a system that enables individuals and firms to buy and sell goods\nD the existence of consumer demand for a good\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nWhat is an example of an external benefit from an individual cycling, rather than driving, to work?\nA higher cost of building cycle lanes\nB improved physical fitness to the individual from cycling\nC lower cost of cycling compared with driving to work\nD reduced congestion for other road users\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nIn response to an increase in price from $5 per kilo to $6 per kilo, a farmer increased supply from\n400 kilos to 500 kilos per week.\n\nWhat is the price elasticity of supply?\nA 0.8\nB 0.9\nC 1.2\nD 1.25\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nIt is expected that consumers will use less paper money.\n\nWhat is the most likely reason for this?\nA Inflation reduces the value of paper money.\nB More ways of making payments will be available.\nC Other forms of money are more durable.\nD Paper money will have less intrinsic value.\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: In low-income countries, fewer girls than boys become skilled design engineers.\n\nWhat might explain this situation?\nA Girls are only interested in low-wage jobs.\nB Girls do not favour heavy manual work.\nC Girls have fewer opportunities to complete higher education.\nD It costs more for girls to be trained as design engineers.\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: A company mining cobalt, invests in machinery to replace some workers. Eventually diseconomies\nof scale occur.\n\nWhat could cause this situation?\nA As more cobalt is mined average costs increase.\nB Fewer workers are needed to produce the required output.\nC Output per hour increases as more machinery is used.\nD Overhead costs are spread as output increases.\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: Why are many hairdressers able to operate as small businesses?\nA high level of competition\nB high scope for economies of scale\nC long period of training required\nD low start-up and running costs\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: Dimitry owns a firm that produces and sells bottles of lemonade. He only sells one size of bottle.\n\nHow would Dimitry calculate the total revenue of the firm?\nA multiply the quantity sold by the cost per bottle\nB multiply the quantity sold by the price per bottle\nC multiply the quantity sold by the profit per bottle\nD multiply the quantity sold by the tax per bottle\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: Which market is likely to be the most competitive?\n\n\nbarriers\nto entry\nnumber\nof sellers\nA high\nfew\nB high\nmany\nC low\nfew\nD low\nmany\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: An economy has a high rate of inflation. In response to this, its government increases income tax.\n\nWhat is the most likely reason for this increase?\nA to discourage the consumption of harmful goods\nB to raise money for government spending\nC to redistribute income\nD to reduce total demand\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: Interest rates are sometimes raised to control inflation.\n\nWhy might this policy be effective?\nA Consumers may save more.\nB Government spending may increase.\nC Investment may be encouraged.\nD The exchange rate may fall.\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: A government\u2019s revenue grew 8% to $3.25 trillion. Its expenditure was reduced to $3.69 trillion.\n\nWhat can be concluded from this?\n\n\nstate of budget\ngovernment\npolicy aim\nA deficit\nincrease deficit\nB deficit\nreduce deficit\nC surplus\nincrease surplus\nD surplus\nreduce surplus\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: A country\u2019s inflation rate, measured by the Consumer Prices Index (CPI), was 3% in year 1.\nThree years later it was 0.8%.\n\nWhat can be concluded from this information?\nA Prices are falling.\nB The rate of price increases is falling.\nC The real rate of interest is negative.\nD There is increased purchasing power for those on fixed incomes.\n\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: What will deflation most likely lead to?\nA a fall in the real value of debts\nB an increase in the exchange rate\nC an increase in the rate of interest\nD an increase in the real purchasing power of money\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: Economic growth can be defined as\nA a reduction in a country\u2019s rate of inflation.\nB an increase in a country\u2019s exports.\nC an increase in a country\u2019s population.\nD an increase in a country\u2019s productive capacity.\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: In a year, two changes occurred in a company.\n\nCompany directors\u2019 salaries increased by 15%.\nOffice workers\u2019 wages increased by 5%.\n\nThe rate of inflation was 3.4%.\n\nWhat happened to real income?\n\n\ncompany directors\u2019\nreal income\noffice workers\u2019\nreal income\nA fell\nfell\nB fell\nrose\nC rose\nfell\nD rose\nrose\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: The richest 60% of the population of a high-income economy received an increase in income.\nThe income of the rest of the population did not change.\n\nWhat happened to absolute and relative poverty?\n\n\nabsolute poverty\nrelative poverty\nA increased\nincreased\nB increased\nremained constant\nC remained constant\nincreased\nD remained constant\nremained constant\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: Gross Domestic Product (GDP) is a better measure of comparative living standards when it is\nadjusted for the effects of\nA exports and inflation.\nB imports and exports.\nC population change and exports.\nD population change and inflation.\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: What is a disadvantage of increasing international specialisation?\nA Consumers pay higher prices for goods and services reducing their welfare.\nB Domestic firms may be uncompetitive leading to structural unemployment.\nC Domestic firms may experience rising costs as they pay more for imports.\nD Resources may be used less efficiently as domestic firms face less competition.\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: Which method of protection always reduces the supply of an imported good to zero?\nA embargo\nB quota\nC subsidy\nD tariff\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: A US car dealer agrees an import price of US$25 000 for a Japanese car at the current rate of\nexchange.\n\nThe US dollar then strengthens by 10% against the Japanese yen.\n\nWhat will be the new import price paid for the Japanese car?\nA US$20 000\nB US$22 500\nC US$25 000\nD US$27 500\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: A country has a deficit on its current account of its balance of payments.\n\nWhat could increase the size of its deficit?\nA increased exports of its services\nB increased international competitiveness of its goods\nC increased numbers of visitors from abroad\nD increased spending on its military bases abroad\n\n\n\nBLANK PAGE\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nWhat is an advantage of competitive markets?\nA Competition causes inequalities of wealth.\nB Competition encourages the efficient use of resources.\nC The economic problem of scarcity is eliminated.\nD The right quantity of merit goods is guaranteed.\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nA multinational company (MNC) wishes to invest in a low-income country to expand its palm oil\nproduction.\n\nWhat is most likely to make this investment possible?\nA high cost of clearing forests to increase land for plantations\nB increased demand for palm oil\nC shortages of labour in the rural economy\nD the removal of subsidies for palm oil production\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nA farmer sells land used for crops to a firm that will use the land for wind turbines to produce\nelectric power.\n\nWhat is the opportunity cost of this decision by the farmer?\nA the cost of installing wind turbines\nB the loss of revenue from crops that grow on the land\nC the profit made from selling the land\nD the reduced cost of producing renewable energy\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nWhat is not included in microeconomics?\nA economies of scale\nB forms of competition\nC individual demand\nD the inflation rate\n\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nWhat determines a consumer\u2019s demand for a product?\n\n\nthe consumer\u2019s\nincome\nthe consumer\u2019s\nwillingness to buy\nthe product\nthe price\nof the product\nA \u0016\n\u0016 \u0016\nB \u0016\n\u0016 \u001a\nC \u001a\n\u0016 \u0016\nD \u0016\n\u001a \u0016\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nWhich problem will be reduced by a government subsidy to a firm?\nA absence of a public good\nB abuse of monopoly power\nC overconsumption of a demerit good\nD underconsumption of a merit good\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nIn response to an increase in price from $5 per kilo to $6 per kilo, a farmer increased supply from\n400 kilos to 500 kilos per week.\n\nWhat is the price elasticity of supply?\nA 0.8\nB 0.9\nC 1.2\nD 1.25\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nWhat might cause consumers in a high-income economy to both save more and spend more?\nA an increase in the rate of interest\nB an increase in wealth\nC expectation that prices will fall in the future\nD inflation rising at a faster rate than wages\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: What would be a disadvantage of specialisation for a worker?\nA a low price of the product that they make\nB boredom due to repetition of the same task\nC higher quality of the good\nD the opportunity to undertake training\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: Which cost of production falls continuously as output increases?\nA average fixed cost\nB average total cost\nC average variable cost\nD total variable cost\n\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: A Swedish furniture maker bought a Romanian firm that owned 83 000 hectares of trees.\n\nWhich type of merger is this most likely to be?\nA diversification\nB horizontal\nC vertical backward\nD vertical forward\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: What is calculated when price is multiplied by the quantity demanded of a product?\nA average revenue\nB profit\nC total cost\nD total revenue\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: A private sector firm is the only supplier of rail services between two cities.\n\nWhat will stop the firm charging very high ticket prices?\nA barriers to entry into rail services\nB competition from public road transport\nC government policy encouraging monopoly power\nD high costs of maintaining rail tracks\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: What is a fiscal policy measure?\nA direct tax\nB exchange rates\nC interest rates\nD regulation\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: A government uses expansionary monetary policy.\n\nWhat does the government decrease?\nA bank lending\nB interest rates\nC the budget deficit\nD the money supply\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: A country is experiencing unemployment. It has a progressive income tax policy and benefits for\nthe poor. The government aims to increase employment and reduce income inequality.\n\nWhich fiscal policy measures are most likely to achieve these aims?\n\n\nincome tax\nbenefits for the poor\nA decrease the highest tax rate\ndecrease\nB increase the highest tax rate\ndecrease\nC decrease the lowest tax rate\nincrease\nD increase the lowest tax rate\nincrease\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: What is likely to happen when a country is experiencing deflation?\nA Consumers delay spending.\nB Governments raise interest rates.\nC The level of imports increases.\nD The real value of money falls.\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: Economic growth can be defined as\nA a reduction in a country\u2019s rate of inflation.\nB an increase in a country\u2019s exports.\nC an increase in a country\u2019s population.\nD an increase in a country\u2019s productive capacity.\n\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: In a year, two changes occurred in a company.\n\nCompany directors\u2019 salaries increased by 15%.\nOffice workers\u2019 wages increased by 5%.\n\nThe rate of inflation was 3.4%.\n\nWhat happened to real income?\n\n\ncompany directors\u2019\nreal income\noffice workers\u2019\nreal income\nA fell\nfell\nB fell\nrose\nC rose\nfell\nD rose\nrose\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: The richest 60% of the population of a high-income economy received an increase in income.\nThe income of the rest of the population did not change.\n\nWhat happened to absolute and relative poverty?\n\n\nabsolute poverty\nrelative poverty\nA increased\nincreased\nB increased\nremained constant\nC remained constant\nincreased\nD remained constant\nremained constant\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: Gross Domestic Product (GDP) is a better measure of comparative living standards when it is\nadjusted for the effects of\nA exports and inflation.\nB imports and exports.\nC population change and exports.\nD population change and inflation.\n\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: What is the most likely benefit for a low-income economy if it removes tariffs on imported goods\nand services?\nA more choice for domestic consumers\nB more employment in declining industries\nC more exports by domestic firms\nD more tax revenue from imports\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: Economies have become increasingly linked through globalisation.\n\nWhat would discourage this?\nA creation of a single world market\nB direct foreign investment by multinational companies\nC expansion of trade in financial services\nD protectionist policies by trading groups\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: What may result from a balance of payments trade surplus?\nA The exchange rate appreciates and causes export prices to fall.\nB The exchange rate appreciates and causes export prices to rise.\nC The exchange rate depreciates and causes export prices to fall.\nD The exchange rate depreciates and causes export prices to rise.\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: A country has a deficit on its current account of its balance of payments.\n\nWhat could increase the size of its deficit?\nA increased exports of its services\nB increased international competitiveness of its goods\nC increased numbers of visitors from abroad\nD increased spending on its military bases abroad\n\n\nBLANK PAGE\n\nBLANK PAGE\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nIncreasing output of one good reduces production of another good.\n\nWhich economic concept does this change represent?\nA average cost\nB diseconomies of scale\nC economies of scale\nD opportunity cost\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nWhat condition in an economy would encourage immigration of labour?\nA high cost of housing\nB preference for domestic over foreign qualifications\nC reduced quotas for foreign workers\nD shortage of skilled workers\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nWho is a microeconomic decision maker?\nA the director of an international trade organisation\nB the entrepreneur of a firm\nC the finance minister of a government\nD the governor of a central bank\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nWhat is an essential feature of a market economy?\nA Central planners determine what, how and for whom to produce.\nB It aims for equality in the distribution of goods and services.\nC The market price reflects both the private and external costs of production.\nD The price mechanism sends signals to consumers and producers to allocate resources.\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nWhat is a definition of market failure?\nA market forces of demand and supply do not allocate resources efficiently\nB not all consumers can afford to buy the goods they would like\nC private benefits of consumption are greater than external benefits\nD public goods are only provided by a government\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nIn response to an increase in price from $5 per kilo to $6 per kilo, a farmer increased supply from\n400 kilos to 500 kilos per week.\n\nWhat is the price elasticity of supply?\nA 0.8\nB 0.9\nC 1.2\nD 1.25\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nAverage incomes rose by 5% but savings did not rise.\n\nWhat might explain this?\nA Consumer confidence in the economy fell.\nB Incomes rose more slowly than the rate of inflation.\nC Interest rates for savings rose.\nD The rate of income tax was reduced.\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: Which firm is in the tertiary sector?\nA bread bakery\nB fruit grower\nC meal delivery\nD road builder\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: What is a benefit to a worker of being a member of a trade union?\nA access to advice\nB guaranteed employment\nC opportunity to work extra hours\nD payment of subscriptions\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: A firm employs 10 workers. Each worker is paid a weekly wage of $200 and produces 50 goods\nper week.\n\nWhat is the average cost of labour per good produced?\nA $0.4\nB $4\nC $20\nD $200\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: How would advertising a good result in a retail firm increasing its market share?\nA It will improve the personal service in its shops.\nB It will increase the firm\u2019s costs.\nC It will reduce demand for competitors\u2019 products.\nD It will result in diversification in the firm.\n\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: What describes the total revenue of a firm?\nA fixed costs plus variable costs\nB income from sales minus total costs\nC quantity of goods sold multiplied by unit price\nD variable costs divided by output\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: What is fiscal policy?\nA government decisions on money supply and interest rates taken to influence total demand\nB government decisions on spending and taxation designed to influence total demand\nC government measures designed to influence total supply in the economy\nD government regulation of the foreign exchange rate to influence imports\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: What is the money supply?\nA the total quantity of foreign currency available within the economy\nB the total quantity of money available within the economy\nC the total quantity of money issued by the central bank\nD the total quantity of money within commercial banks\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: What may cause deflation?\nA advances in technology and increases in labour productivity\nB government using a policy of very low interest rates\nC increases in the costs of production that reduce firms\u2019 profits\nD increases in the rate of inflation as measured by the CPI\n\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: Economic growth can be defined as\nA a reduction in a country\u2019s rate of inflation.\nB an increase in a country\u2019s exports.\nC an increase in a country\u2019s population.\nD an increase in a country\u2019s productive capacity.\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: In a year, two changes occurred in a company.\n\nCompany directors\u2019 salaries increased by 15%.\nOffice workers\u2019 wages increased by 5%.\n\nThe rate of inflation was 3.4%.\n\nWhat happened to real income?\n\n\ncompany directors\u2019\nreal income\noffice workers\u2019\nreal income\nA fell\nfell\nB fell\nrose\nC rose\nfell\nD rose\nrose\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: The richest 60% of the population of a high-income economy received an increase in income.\nThe income of the rest of the population did not change.\n\nWhat happened to absolute and relative poverty?\n\n\nabsolute poverty\nrelative poverty\nA increased\nincreased\nB increased\nremained constant\nC remained constant\nincreased\nD remained constant\nremained constant\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: Gross Domestic Product (GDP) is a better measure of comparative living standards when it is\nadjusted for the effects of\nA exports and inflation.\nB imports and exports.\nC population change and exports.\nD population change and inflation.\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: What is a benefit of a multinational company (MNC) to the host country?\nA A MNC may improve the reputation of its home country as a high-quality producer.\nB Exports by a MNC may result in an improved trade balance for the host country.\nC Production by a MNC may lead to higher levels of pollution in the host country.\nD Profits made by a MNC are sent back to its home country.\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: Globalisation is the process by which domestic firms become involved in international markets.\n\nWhat encourages globalisation?\nA controls on foreign exchange\nB immigration restrictions\nC increasing tariffs\nD widespread use of the internet\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: What does a foreign exchange rate between Malaysia and the US measure?\nA the cost of the Malaysian currency in the US currency\nB the difference in the cost of living between Malaysia and the US\nC the difference in the standard of living between Malaysia and the US\nD GDP of Malaysia divided by the GDP of the US\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: A country has a deficit on its current account of its balance of payments.\n\nWhat could increase the size of its deficit?\nA increased exports of its services\nB increased international competitiveness of its goods\nC increased numbers of visitors from abroad\nD increased spending on its military bases abroad\n\n\n\nBLANK PAGE\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nA government uses different supply-side policy measures to improve economic performance.\n\nWhich policy measure would not satisfy one of the government\u2019s macroeconomic aims?\nA changing the tax system which leads to more tax evasion\nB encouraging foreign investment which improves the balance of payments\nC privatising state industries which increases economic growth\nD retraining redundant workers which lowers unemployment\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nWhat could cause an increase in demand for a factor of production?\nA decrease in the efficiency of the factor of production\nB decrease in the price of an alternative factor of production\nC increase in the demand for the good or service produced\nD increase in the price of the factor of production\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nWhich components, in addition to Gross Domestic Product (GDP) per head, are included in the\nHuman Development Index (HDI)?\nA average earnings and inequalities of incomes\nB balance of trade and balance of payments\nC life expectancy at birth and expected years of schooling\nD size of population and age structure of population\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nThe US government introduces tariffs on steel imported from China. This increases the price of\nimported Chinese steel.\n\nWhose income would be likely to increase as a direct result?\n\n\nChinese steel\nproducers\nUS government\nA yes\nyes\nB yes\nno\nC no\nyes\nD no\nno\n\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nA government retrains unemployed industrial workers to increase employment opportunities. The\npolicy may have adverse effects on other government macroeconomic aims.\n\nWhat illustrates this situation?\nA Better skilled workers may increase productivity and improve economic growth.\nB Increased wage-earning capacity may lead to demand-pull inflation.\nC More employed workers may reduce government expenditure on benefit payments.\nD Near full employment may result in a more stable balance of payments.\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nA firm has a high price elasticity of supply for its product.\n\nWhat does this indicate?\nA It can increase revenue by reducing the price.\nB It can quickly respond to changes in price.\nC It keeps very low volumes of product in stock.\nD It produces a good that has close substitutes.\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: A manufacturer of medical supplies benefits from improved road links to its main markets.\n\nWhat benefit definitely occurs as a result?\nA increased average revenue\nB increased external economies of scale\nC increased internal economies of scale\nD increased market share\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: Which row shows an essential characteristic of competitive markets and monopoly markets?\n\n\ncompetitive markets\nmonopoly markets\nA many buyers\nsingle seller\nB many sellers\nsingle buyer\nC single buyer\nmany buyers\nD single seller\nmany sellers\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: A student has nothing to do on a Friday evening. She withdraws $5 from the $100 she has in a\nsavings account and buys a present to take to a party, to which admission is free.\n\nWhat does this involve?\nA an opportunity cost equal to $95\nB an opportunity cost equal to other goods she could have bought for $5\nC no opportunity cost, as entrance to the party is free\nD no opportunity cost, as she had no better way of using the time\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: The development of artificial intelligence in machines raises the productivity of capital.\n\nWhat will be the effect of this?\nA The costs of production will increase.\nB The demand for capital will increase.\nC The price of capital will fall.\nD The supply of capital will decrease.\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: Which combination is necessary for the construction of a consumer prices index?\n\n\na base year\nprice stability\nweights\nA yes\nyes\nyes\nB yes\nno\nyes\nC yes\nno\nno\nD no\nyes\nyes\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: A government removed the quota on goods imported into the country.\n\nWhat is the most likely result of this?\nA a decrease in demand for domestic production\nB a decrease in domestic unemployment\nC a decrease in exports\nD a decrease in the balance of trade deficit\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: What is an advantage of a country having a market economic system with a large private sector?\nA Firms can become unprofitable if they do not produce what consumers want.\nB Market forces often fail to ensure maximum benefits for society.\nC Some goods may not be provided at all or not in sufficient quantity.\nD There is an unequal distribution of income which can increase over time.\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: What is an example of a fiscal policy measure?\nA increasing the exchange rate\nB reducing the power of trade unions\nC reducing the rate of corporation tax\nD setting a lower interest rate\n\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: Why would an increase in the interest rate potentially lead to lower inflation?\nA Consumers will be more willing to save when interest rates are high.\nB Consumers will be more willing to spend when interest rates are high.\nC Producers will be more willing to borrow from banks when interest rates are high.\nD Producers will be more willing to invest when interest rates are high.\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: Which government action will not add directly to the quantity or quality of human resources?\nA improvement in health facilities\nB investment in education and training\nC provision of better food and nutrition\nD reclamation of land from the sea\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: What is a likely cause of economic growth?\nA decreased employment\nB decreased investment\nC decreased productivity\nD decreased taxation\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: Why would standards of living fall when there is a recession?\nA The government would increase taxes to combat the recession.\nB The purchasing power of households would fall.\nC The value of the domestic currency would increase.\nD There would be a rise in the level of immigration.\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: The governments of low-income countries often allow foreign multinational companies (MNCs) to\nmine minerals in their country.\n\nWhich conflict between benefit and cost might this cause the low-income countries?\n\n\nbenefit\ncost\nA improved balance of trade\ntraining by the MNCs\nB higher employment\nloss of a finite resource\nC increased profits for the MNCs\nefficient production\nD more sustainable development\neconomic growth\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: What is the definition of foreign exchange rate?\nA the difference between emigration and immigration\nB the difference between the values of imports and exports\nC the price of one currency in terms of another\nD the price of one good in terms of another\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: Which activity is correctly linked to the organisation that provides it?\n\n\norganisation\nactivity\nA central bank\nregulate the rate of inflation\nB central bank\nset direct tax rates\nC commercial bank\nmanage the government\u2019s financial accounts\nD commercial bank\nsafeguard the country\u2019s foreign reserves\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: Which topic is not included in microeconomics?\nA consumer demand\nB economies of scale\nC forms of competition\nD inflation\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: What is likely to cause an immediate decrease in the size of the labour force?\nA a fall in the average size of families\nB a fall in the birth rate\nC a reduction in the age of retirement\nD an increase in net immigration\n\n\n\nBLANK PAGE\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nWhat is an example of a free good?\nA defence\nB education\nC health services\nD sunshine\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nA student has nothing to do on a Friday evening. She withdraws $5 from the $100 she has in a\nsavings account and buys a present to take to a party, to which admission is free.\n\nWhat does this involve?\nA an opportunity cost equal to $95\nB an opportunity cost equal to other goods she could have bought for $5\nC no opportunity cost, as entrance to the party is free\nD no opportunity cost, as she had no better way of using the time\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nWhich relationship would be studied by an economist specialising in macroeconomics?\nA the relationship between the inflation rate and the unemployment rate\nB the relationship between the output of a firm and its costs of production\nC the relationship between the price of a product and the quantity demanded by a consumer\nD the relationship between the wage rate of workers and demand for labour in an occupation\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nIn recent years, a government has started to make more use of the free market system. However,\nthey are doing it very slowly to avoid the disadvantages that a free market system might bring.\n\nWhat is a possible disadvantage of the free market system?\nA decreased incentive to work\nB decreased levels of pollution\nC increased efficiency\nD increased inequality of income\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: What could cause profits to be high in a monopoly market?\nA barriers to entry\nB diseconomies of scale\nC elastic demand for the product\nD high number of substitutes for the product\n\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: Which firm is most likely to be classified as a small firm in the tertiary sector?\nA a farm\nB a hairdresser\nC a steelworks\nD a supermarket\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: Germany is considered a capital-intensive economy while Indonesia is considered a\nlabour-intensive economy.\n\nWhat does this mean about the economies of Germany and Indonesia?\nA Capital is relatively cheaper than labour in Germany while labour is relatively cheaper than\ncapital in Indonesia.\nB Germany has many primary sector workers while Indonesia has many tertiary sector\nworkers.\nC Indonesia has a higher growth in its population size than Germany.\nD Relatively more low-cost labour is available in Germany while capital is more efficient than\nlabour in Indonesia.\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: A bank continues to operate loss-making branches.\n\nWhich objective is the bank trying to achieve?\nA growth\nB efficiency\nC profit maximisation\nD social welfare\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: Which activity is correctly linked to the organisation that provides it?\n\n\norganisation\nactivity\nA central bank\nregulate the rate of inflation\nB central bank\nset direct tax rates\nC commercial bank\nmanage the government\u2019s financial accounts\nD commercial bank\nsafeguard the country\u2019s foreign reserves\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: The chart shows a government\u2019s spending in a year.\n\n40 000\n35 000\n30 000\n25 000\n20 000\n15 000\n10 000\n5000\n0 social security\nand welfare\n34 006\nhealth\n18 660\neducation\n15 280\nlaw and\norder\n5050\ndefence\n2390\n$ (millions)\n\n\nWhat was the total government spending on public goods?\nA $2390 million\nB $5050 million\nC $7440 million\nD $33 940 million\n\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: A government wishes to pursue an expansionary monetary policy.\n\nWhat should it do?\nA discourage bank lending\nB give subsidies to firms\nC lower income tax thresholds\nD lower interest rates\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: A government introduces a series of economic measures.\n\nWhat is a supply-side policy measure?\nA building more affordable homes to improve labour mobility\nB controlling consumer spending to reduce inflation\nC lowering interest rates to encourage purchase of expensive goods\nD raising pensions to help retired people pay their fuel bills\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: What is identified as economic growth?\nA a fall in labour productivity\nB an increase in the productive capacity of the economy\nC an increase in the Consumer Prices Index (CPI)\nD the economy enters a period of recession\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: The retail trade in a country has unemployed workers in one region and job vacancies in another\nregion.\n\nWhat could explain this?\nA Costs of employing workers are lower when there is unemployment.\nB It is more expensive to live in the area where the retail jobs are available.\nC Retailing demands the same skills everywhere.\nD The geographical mobility of labour has increased.\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: A country wishes to reduce the level of inflation.\n\nWhich combination of policy measures will be most successful?\n\n\npolicy measure 1\npolicy measure 2\nA decrease exchange rates\nincrease interest rates\nB decrease interest rates\nincrease exchange rates\nC increase government spending\ndecrease interest rates\nD increase interest rates\ndecrease government spending\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: A government wants to reduce both its budget deficit and the amount of poverty in its country.\n\nWhich fiscal policy measure is most likely to achieve both of these aims?\nA decreasing the rate of progressive income tax\nB decreasing government spending on welfare benefits\nC increasing the rate of progressive income tax\nD increasing government spending on welfare benefits\n\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: Which components, in addition to Gross Domestic Product (GDP) per head, are included in the\nHuman Development Index (HDI)?\nA average earnings and inequalities of incomes\nB balance of trade and balance of payments\nC life expectancy at birth and expected years of schooling\nD size of population and age structure of population\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: What is likely to cause an immediate decrease in the size of the labour force?\nA a fall in the average size of families\nB a fall in the birth rate\nC a reduction in the age of retirement\nD an increase in net immigration\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: The price of a currency in a fixed exchange rate system is reduced.\n\nWhat is this called?\nA appreciation\nB depreciation\nC devaluation\nD revaluation\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: A government removed the quota on goods imported into the country.\n\nWhat is the most likely result of this?\nA a decrease in demand for domestic production\nB a decrease in domestic unemployment\nC a decrease in exports\nD a decrease in the balance of trade deficit\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: What is most likely to result from a reduction in the value of a country\u2019s currency if there are no\nother changes in the economy?\nA A trade in goods surplus will fall.\nB Export prices will rise.\nC Import prices will rise.\nD The inflation rate will fall.\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: The governments of low-income countries often allow foreign multinational companies (MNCs) to\nmine minerals in their country.\n\nWhich conflict between benefit and cost might this cause the low-income countries?\n\n\nbenefit\ncost\nA improved balance of trade\ntraining by the MNCs\nB higher employment\nloss of a finite resource\nC increased profits for the MNCs\nefficient production\nD more sustainable development\neconomic growth\n\n\n\nBLANK PAGE\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nWhich factor has the correct factor reward identified?\n\n\nfactor\nfactor reward\nA capital\nprofit\nB enterprise\nwages\nC labour\ninterest\nD land\nrent\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nA student has nothing to do on a Friday evening. She withdraws $5 from the $100 she has in a\nsavings account and buys a present to take to a party, to which admission is free.\n\nWhat does this involve?\nA an opportunity cost equal to $95\nB an opportunity cost equal to other goods she could have bought for $5\nC no opportunity cost, as entrance to the party is free\nD no opportunity cost, as she had no better way of using the time\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nWhich topic is studied in macroeconomics?\nA cost-push inflation\nB market price determination\nC public goods\nD the output of a firm\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nChina is moving towards a more mixed economic system and reducing the role of the public\nsector.\n\nWhich economic policy measure might best achieve this?\nA creating excess capacity in state-owned enterprises\nB encouraging competition among private sector firms\nC protecting infant industries\nD subsidising transport infrastructure\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nWhich statement about price elasticity of demand (PED) is correct?\nA PED measures the percentage change in quantity demanded divided by the percentage\nchange in price.\nB PED measures the change in price divided by the change in the quantity demanded.\nC PED means a change in price will cause an equal change in the quantity demanded.\nD PED means a change in demand will result in a greater percentage change in price.\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: A cinema has 500 seats. It raised its admission price from $2 to $5 and daily revenue increased\nfrom $800 to $1500.\n\nWhat can be concluded from this information?\nA Price elasticity of demand for cinema seats was elastic.\nB Price elasticity of supply of cinema seats was elastic.\nC The cinema operated below full capacity.\nD The cinema\u2019s profits rose by $700.\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: What is an outcome of a competitive market?\nA high prices and low quality\nB low prices and large choice\nC high profits and low quality\nD low profits and little choice\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: What might prevent an individual choosing a particular occupation?\nA little opportunity for career progression\nB low cost of travelling to work\nC no risk to personal health\nD wage rate above national minimum wage\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: What might encourage a consumer to spend less and save more?\nA the expectation that prices will fall\nB the expectation that prices will rise\nC the expectation that unemployment will fall\nD the expectation that real GDP will rise\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: Which activity is correctly linked to the organisation that provides it?\n\n\norganisation\nactivity\nA central bank\nregulate the rate of inflation\nB central bank\nset direct tax rates\nC commercial bank\nmanage the government\u2019s financial accounts\nD commercial bank\nsafeguard the country\u2019s foreign reserves\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: What is not usually a macroeconomic aim?\nA balance of payments stability\nB high government borrowing\nC lowering cyclical unemployment\nD reducing absolute poverty\n\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: A government decides to increase the indirect tax on petrol. Petrol has an inelastic price elasticity\nof demand.\n\nWhat are likely to be the consequences?\n\n\nquantity of\npetrol bought\ngovernment\nrevenue\nA decreases\ndecreases\nB decreases\nincreases\nC increases\ndecreases\nD increases\nincreases\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: In a country, there is an increase in the rate of interest to prevent inflation.\n\nWhich type of macroeconomic policy is this?\nA fiscal policy\nB monetary policy\nC supply-side policy\nD trade policy\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: A government significantly increases its spending on education and training over several years.\n\nWhat will be the likely effect of this policy measure on the rate of inflation in both the short run\nand the long run?\n\n\nshort-run effect\nlong-run effect\nA decreases\ndecreases\nB decreases\nincreases\nC increases\ndecreases\nD increases\nincreases\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: What may cause a recession?\nA an increase in consumer spending\nB an increase in government spending\nC an increase in imports\nD an increase in investment\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: In a country, inflation is 10% and nominal interest rates are 7%.\n\nWhich group is most likely to benefit from this situation?\nA borrowers\nB employers\nC lenders\nD savers\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: Which action is not performed by a government as part of its international role?\nA building offshore wind farms\nB imposing tariffs on imports\nC issuing visas to foreign tourists\nD providing humanitarian aid to refugees\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: Which components, in addition to Gross Domestic Product (GDP) per head, are included in the\nHuman Development Index (HDI)?\nA average earnings and inequalities of incomes\nB balance of trade and balance of payments\nC life expectancy at birth and expected years of schooling\nD size of population and age structure of population\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: What is likely to cause an immediate decrease in the size of the labour force?\nA a fall in the average size of families\nB a fall in the birth rate\nC a reduction in the age of retirement\nD an increase in net immigration\n\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: When are countries most likely to specialise and trade with each other?\nA when the cost of transport between them is high\nB when there are large differences in their resource allocations\nC when they have access to the same technology\nD when they have high tariffs and other protective measures\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: A government removed the quota on goods imported into the country.\n\nWhat is the most likely result of this?\nA a decrease in demand for domestic production\nB a decrease in domestic unemployment\nC a decrease in exports\nD a decrease in the balance of trade deficit\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: A country has a surplus on the current account of its balance of payments.\n\nWhat would be most likely to cause the country to move into deficit?\nA devaluation of its fixed exchange rate\nB government subsidies to its exporters\nC improved technology in other countries\nD productivity increases in its export industries\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: The governments of low-income countries often allow foreign multinational companies (MNCs) to\nmine minerals in their country.\n\nWhich conflict between benefit and cost might this cause the low-income countries?\n\n\nbenefit\ncost\nA improved balance of trade\ntraining by the MNCs\nB higher employment\nloss of a finite resource\nC increased profits for the MNCs\nefficient production\nD more sustainable development\neconomic growth\n\n\n\nBLANK PAGE\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nhigh employment levels\nA high investment levels\nB unlimited resources\nC unlimited wants\nD What does a point on a production possibility curve for an economy represent?\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \neconomic growth is falling\nA inefficient use of resources available\nB maximum output possible with current technology\nC total demand for goods and services\nD What is most likely to increase enterprise as a factor of production in an economy?\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \na decrease in government spending on education\nA a decrease in regulation on firms\nB an increase in emigration\nC an increase in taxation on firms\nD Which economic activity would be classified as macroeconomics?\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nhouseholds spend less on holidays abroad\nA income tax is increased by the government\nB wages rise for construction workers\nC world coffee price rises due to poor weather\nD The diagram shows the effect of a decrease in price on the demand for a product.\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nprice\nP1\nQ1\nQ2\nP2\nO quantity\ndemanded\nD D\nWhat does the arrow on the diagram illustrate?\ncontraction in demand\nA decrease in demand\nB extension in demand\nC increase in demand\nD What is the correct formula to calculate price elasticity of supply?\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nthe percentage change in price divided by the change in quantity supplied\nA the percentage change in price divided by the percentage change in quantity supplied\nB the percentage change in quantity supplied divided by the change in price\nC the percentage change in quantity supplied divided by the percentage change in price\nD What is the most likely cause of a product having a price elasticity of demand greater than one?\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nThe product has a close substitute.\nA The product is a habit-forming good.\nB The product is a necessity.\nC The product requires only a small proportion of consumer income.\nD For some illnesses, wearing a face mask has a benefit as it could prevent people from getting\ninfected. Not all people are willing to wear face masks.\nBased on the statement above, why would there be an inefficient allocation of face masks in the\nfree market?\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nConsumers in the free market only consider private costs and benefits.\nA Face masks are non-rival and non-excludable.\nB There is abuse of monopoly power by the producer of face masks.\nC There is perfect information in the free market.\nD What would bring about a movement upwards along the supply curve for rice?\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \na decrease in the productivity of farmworkers\nA a decrease in the profitability of rice production\nB an increase in consumers\u2019 incomes\nC an increase in farmworkers\u2019 wages\nD A government decides to reduce air pollution in city centres by giving financial assistance to bus\ncompanies, reducing their costs of production and prices for passengers.\nWhich type of policy measure is this?\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \na maximum price\nA a minimum price\nB a subsidy\nC regulation\nD What would be least likely to act as a store of value during a period of rapid inflation?\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \ncash\nA gold\nB property\nC shares\nD A country\u2019s central bank raised the rate of interest from 1% to 4% per year.\nHow would this change have affected the amount saved and the cost of borrowing by individuals?\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \ncost of\nborrowing\namount\nsaved\ndecreased\ndecreased\nA increased\ndecreased\nB decreased\nincreased\nC increased\nincreased\nD Which factor would not increase the bargaining strength of a trade union to raise wages?\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \na rapidly growing economy\nA high union membership in the industry\nB legislation limiting strike action\nC workers are in short supply\nD Which conditions are most likely to attract small firms to enter a market?\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nfixed costs of\nentering the\nindustry\nthe market for\nthe product\nhigh\nlocal\nA low\nlocal\nB high\nnational\nC low\nnational\nD The diagram shows a firm\u2019s total cost (TC) curve.\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \n0 10\n50\n10\nTC\ncost\n$ units of output\nWhat is the average variable cost if the firm produces 10 units of output?\n$50\nD $40\nC $5\nB $4\nA The table shows the units of factors of production that a firm needs to employ for two different levels\nof output.\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \noutput\ncapital\nlabour\nland\n100\n4 2\n5 150\n8 4\n10\nWhat is the firm experiencing?\nconstant returns to scale\nA diseconomies of scale\nB external diseconomies of scale\nC external economies of scale\nD What is an example of a government macroeconomic aim?\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \na minimum of 10 years of schooling\nA a sales tax of 10% on consumer goods\nB a target rate of 2% inflation\nC increasing pay for nurses\nD Government policy measures can affect economic activity in a country.\nWhich pair of monetary policy measures would be likely to increase employment?\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \ndepreciate foreign exchange rates and increase education spending\nA increase money supply and reduce interest rates\nB provide subsidies and grants and lower sales tax\nC reduce income tax and improve infrastructure\nD What would be most likely to encourage saving?\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \na rise in the exchange rate\nA a rise in the goods and services tax rate\nB a rise in the income tax rate\nC a rise in the interest rate\nD The government of a country operating at full employment increases its spending on education and\ntraining.\nHow does this affect the likelihood of achieving low inflation in the short run and the long run?\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nlong run\nshort run\nless likely\nless likely\nA more likely\nless likely\nB less likely\nmore likely\nC more likely\nmore likely\nD A government has introduced a tax on a necessity. Producers have passed on a large proportion\nof this tax to consumers in the form of higher prices.\nWhich row is correct?\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nprice elasticity\nof demand\ntype of tax\nprice elastic\ndirect\nA price inelastic\ndirect\nB price elastic\nindirect\nC price inelastic\nindirect\nD What is most likely to lead to an increase in structural unemployment in a country?\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nThe country is experiencing a period of negative economic growth.\nA The country is experiencing a period of positive economic growth.\nB The country is moving from producing primary sector goods to secondary sector goods.\nC The country is moving towards more flexible labour markets.\nD Which citizens are most likely to benefit in a period of rapid inflation?\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \ncitizens who are receiving fixed state benefits\nA citizens who earn fixed incomes\nB citizens who have lent money at a fixed rate of interest\nC citizens who have borrowed money at a fixed rate of interest\nD Which statement is correct about the Human Development Index (HDI) and real GDP?\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nHDI includes exports and imports while real GDP does not.\nA HDI includes life expectancy and years of schooling while real GDP does not.\nB HDI includes the level of output while real GDP does not.\nC HDI includes the level of unemployment in the population while real GDP does not.\nD Other things being equal, what will cause a population both to increase and to age?\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \na fall in the birth rate\nA a fall in the death rate\nB a rise in both the birth rate and the death rate\nC a rise in the death rate and a fall in the birth rate\nD Which change would be unlikely to be found in a country as it develops?\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nan increase in average incomes and a decrease in unemployment\nA an increase in manufacturing production and an increase in shipping services\nB an increase in subsistence farming and a decrease in financial services\nC an increase in tourism and an increase in the export of agricultural products\nD It is cheaper for developed economies to buy some cereals from developing economies than to\nproduce them domestically.\nWhat might reduce international trade in cereals?\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nCereals become less popular with the population of developing economies.\nA Developed economies place an embargo on cereal imports to prevent disease.\nB Governments tax cereal production in developed economies.\nC Producers of cereals in developing economies are subsidised.\nD A country imposes a quota on imported cars.\nWhat is the most likely outcome of this action?\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \na decrease in the domestic output of cars\nA a decrease in the domestic price of cars\nB an increase in the tax revenue from car imports\nC an increase in the total revenue of domestic car producers\nD An Argentine product initially sells in the US for $50 when the exchange rate between the two\ncountries is 5 pesos to 1 dollar.\nThe exchange rate changes to 10 pesos to 1 dollar and the price of the product remains unchanged\nin Argentina.\nWhat will be the new price of the product in the US?\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \n$500\nD $100\nC $25\nB $5\nA Which policy measure is most likely to reduce the current account deficit of the balance of payments\nof an economy?\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \ndecrease the level of subsidies to domestic producers\nA increase infrastructure spending to increase domestic productivity\nB increase interest rates\nC remove import tariffs\nD BLANK PAGE\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nhigh levels of taxation\nA low levels of investment\nB unequal distribution of income\nC unlimited consumer wants\nD A country\u2019s production possibility curve (PPC) moves from PPC1 to PPC2.\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nO consumer\ngoods\ncapital goods\nPPC1\nPPC2\nWhat could cause this movement in the PPC?\nlower\nunemployment\nhigher\ninvestment\nbetter\neducation\ntrue\nfalse\nfalse\nA false\ntrue\nfalse\nB true\nfalse\ntrue\nC false\ntrue\ntrue\nD A government spends $100m on subsidising wind farm construction instead of spending it on an\nincrease in healthcare.\nWhich economic concept does this spending decision illustrate?\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nexternal cost\nA free goods\nB market disequilibrium\nC opportunity cost\nD What is an example of a macroeconomic indicator?\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nagricultural prices\nA average earnings in the secondary sector\nB real Gross Domestic Product (real GDP)\nC total costs of German pharmaceutical firms\nD Good X is demanded in two areas, Y and Z. The table shows the amount of X demanded in these\nareas at different prices.\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nquantity demanded\nper month\nprice of\ngood X\n(US$)\narea Z\narea Y\n200\n1000\n5 150\n800\n10\n100\n600\n15\n50\n400\n20\n0 200\n25\nWhat can be concluded from the table?\nConsumers in area Y are more willing and able than consumers in area Z to buy good X.\nA Consumers in area Y are richer than consumers in area Z.\nB Consumers in area Y want the good more than consumers in area Z.\nC There are more consumers living in area Y than in area Z.\nD Which price elasticity of demand (PED) would cause an increase in total revenue if the price of the\ngood increased?\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nperfectly elastic\nA relatively elastic\nB relatively inelastic\nC unitary elastic\nD The diagram shows the supply curve for coffee.\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nP2\nP1\nQ1\nQ2\nO price\nquantity\nsupply\nThe price of coffee increases from P1 to P2.\nHow would this benefit firms in the coffee industry?\nA higher price gives firms the ability to increase profits.\nA A higher price gives firms the incentive to reduce total fixed costs.\nB A higher price will encourage consumers to buy more coffee increasing total revenue.\nC A higher price will encourage less firms to enter the market to supply coffee.\nD What might be an external benefit of an increase in the number of university graduates in an\neconomy?\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nan increase in revenue for the universities from fee-paying students\nA an increase in tax revenue from a more productive labour force\nB an increase in graduate employment as a percentage of the working population\nC an increase in wages for graduates\nD The price of a good increases.\nWhat could cause this?\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nThe cost of raw materials falls.\nA The incomes of consumers rise.\nB The price of a complement rises.\nC The price of a substitute falls.\nD Imposing a maximum price for a good is an example of which type of government policy?\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nfiscal\nA monetary\nB regulation\nC supply-side\nD Savers suffer as inflation rises to 4.4%.\nWhich function of money is most involved in this statement?\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nmeans of deferred payments\nA medium of exchange\nB store of value\nC unit of account\nD One of the functions of money is to act as a measure of value.\nWhat does this mean?\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nMoney allows people to borrow and lend.\nA Money allows people to save their surplus income.\nB Money is used to buy goods and services.\nC Money is used to compare the worth of different goods and services.\nD Which trade union activity will be beneficial for firms?\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nballoting for industrial action to prevent redundancies\nA campaigning to raise wages of trade union members\nB instructing workers to strike over a safety dispute\nC providing training which raises productivity of workers\nD What is not a variable cost of production?\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \ncost of fuel\nA cost of raw materials\nB extra pay for working additional hours\nC rent of offices\nD What is a definition of a firm\u2019s revenue?\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nmoney received from sales\nA sales volume\nB surplus over costs\nC tax payments\nD What could cause internal diseconomies of scale for a firm?\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \na fall in demand for the products produced by the firm\nA a merger with another firm that results in slower decision-making\nB spending more on research and development to create new products\nC the lack of skilled labour in the geographical area where the firm is based\nD A government decides to leave direct taxes unchanged but to increase indirect taxes.\nWhat is this policy intended to achieve?\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nto increase the value of the exchange rate\nA to redistribute income from higher to lower income groups\nB to reduce a budget deficit\nC to reduce the rate of inflation\nD What is the most likely reason to increase government subsidies?\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nto decrease consumption of a merit good\nA to increase consumption of a merit good\nB to decrease consumption of a demerit good\nC to increase consumption of a demerit good\nD Which people are most likely to gain at a time of inflation?\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \ncompanies who sell abroad\nA foreign tourists visiting the country\nB those living on their savings\nC those who are repaying borrowed money\nD The government of country Z announces an increase in spending on work-place training.\nWhat is the effect of this supply-side policy likely to be?\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \na decrease in country Z\u2019s employment rate\nA a decrease in country Z\u2019s exchange rate\nB an increase in country Z\u2019s economic growth rate\nC an increase in country Z\u2019s interest rate\nD The table shows real GDP in US$ billion for a country over a three-year period.\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nreal GDP\nUS$ billion\nyear\n205\n215\n219\n1 2\n3 What does the GDP data indicate for the country between year 1 and year 3?\na reduction in the rate of inflation\nA an increase in the rate of economic growth\nB the existence of economic growth\nC the existence of economic growth per capita\nD What is a likely consequence of a falling level of unemployment?\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \ndownward pressure on wage rates\nA increase in welfare benefit payments\nB rise in absolute poverty\nC rise in income tax revenue\nD The diagrams show Italy\u2019s unemployment rate and GDP per head.\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nItaly\u2019s unemployment rate\n13\n11\n9 7\n5 2000\n2005\n2010\n2015\nyear\nItaly\u2019s GDP per head\n39 000\n38 000\n37 000\n36 000\n35 000\n34 000\n33 000\n2000\n2005\n2010\n2015\nyear\n% $\nWhen do Italy\u2019s unemployment rate and GDP per head rise at the same time?\n2000\u20132001\nA 2007\u20132008\nB 2009\u20132010\nC 2014\u20132015\nD During a recession, many people in a city become unemployed and their incomes fall. Some people\ncan no longer pay the rent on their houses or buy the food they need.\nWhat is the effect of the recession in the city?\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nrelative poverty\nabsolute poverty\nincreases\nincreases\nA unchanged\nincreases\nB increases\nunchanged\nC unchanged\nunchanged\nD The Peruvian government set itself the target of reducing the number of its population in poverty.\nWhat change does not indicate that the Peruvian government had made progress towards this\ntarget?\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \na rise in employment\nA a rise in infant mortality\nB a rise in life expectancy\nC a rise in the level of adult literacy\nD What is not a reason for the decline in manufacturing industries in developed economies in recent\nyears?\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \ngrowth of newly industrialised competitor countries\nA invention of automated production methods\nB rising costs of factor inputs in the steel industry\nC considerable skill shortages as school-leavers prefer to work in the service sector\nD The table shows a country\u2019s exports and imports.\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \n$m\n200\n190\n35\n38\nexports of goods\nimports of goods\nexports of services\nimports of services\nWhat was the country\u2019s balance of trade in goods and services?\na deficit of $7million\nA a deficit of $13million\nB a surplus of $7million\nC a surplus of $13million\nD Country X exports steel to country Y at a price below its cost of production. This has led to a fall in\ndemand for steel produced in country Y.\nWhat is a method of trade protection that country Y could use to reduce the imports of steel from\ncountry X?\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \napply anti-dumping tariffs\nA increase interest rates\nB revalue the currency\nC subsidise the export of steel\nD What would increase the demand for a country\u2019s currency on the foreign exchange market?\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \na decrease in its inward investment\nA a decrease in its rate of interest\nB an increase in its exports\nC an increase in its imports\nD Country X has a persistent deficit on the current account of the balance payments.\nWhich policy measure is most likely to improve this situation?\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nlowering import quotas\nA lowering income tax\nB lowering import tariffs\nC lowering export subsidies\nD BLANK PAGE\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nIncome in Switzerland is unevenly distributed.\nA Inflation in Switzerland is high.\nB Swiss citizens expect high living standards.\nC Swiss citizens have to make choices in consumption.\nD The production possibility curve of a country has shifted from PPC1 to PPC2.\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nO capital\ngoods\nconsumer\ngoods\nPPC1\nPPC2\nWhat could have caused this shift?\na decrease in the rate of unemployment\nA a fall in the birth rate\nB improved education\nC outdated technology not being replaced\nD What is most likely to increase the geographical mobility of labour?\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nan increase in the amount of credit available to firms\nA an increase in the quantity of low-cost housing\nB an increase in spending by firms on research and development\nC an increase in spending by government on apprenticeships and training\nD What is not a microeconomic decision?\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nA firm decides to increase the price of its product.\nA A government decides to increase interest rates.\nB A household decides to reduce its demand for fuel.\nC A trade union decides to go on strike.\nD What is a feature of a market in equilibrium?\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \ndemand exceeds supply\nA no profits are earned\nB the market will clear\nC there will be a surplus of products\nD The diagram shows the supply curve for a good.\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nX Y\nS price $\nO quantity\nWhat is the name and cause of the movement from X to Y?\na contraction of supply caused by a decrease in demand\nA a contraction of supply caused by an increase in demand\nB an extension of supply caused by a decrease in demand\nC an extension of supply caused by an increase in demand\nD In the diagram, which supply curve has the perfectly inelastic supply?\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nprice $\nO quantity\nA B\nC D\nThe diagram shows the market for petrol (gasoline). SP is the supply of petrol based on the private\ncost of petrol production and SS is the supply of petrol based on the social cost of production.\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nSS\nP2\nQ2\nQ3\nQ1\nP1\nSP\nD O\nprice of\npetrol\nquantity of petrol\nWhich distance shows the market failure caused by the production of petrol?\nQ3Q1\nD Q2Q1\nC OQ2\nB OQ1\nA In a given year, the world output of coal was 3.94 billion metric tonnes at an average yearly price\nof $252 per metric tonne.\nSeveral years later, world output was 3.66 billion metric tonnes at an average yearly price of\n$120 per metric tonne.\nWhat might have caused such a fall in the price of coal?\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nalmost half the world\u2019s coal reserves were in just two countries\nA the exhaustion of coal seams throughout the world\nB the switch to renewable sources of energy\nC the use of coal as a raw material as well as a fuel\nD A government believes that people eat too much sugar but not enough fruit.\nWhich combination of policies would the government introduce?\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nfruit\nsugar\nincrease its tax\nincrease its tax\nA subsidise its production\nincrease its tax\nB increase its tax\nsubsidise its production\nC subsidise its production\nsubsidise its production\nD Which row shows a characteristic of money and a function of money?\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nfunction\ncharacteristic\nmedium of exchange\nacceptability\nA measure of value\ncash\nB portability\ndivisibility\nC bank deposit\nstore of value\nD When will a central bank act as lender of last resort to a commercial bank?\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nwhen a commercial bank faces a liquidity crisis\nA when a commercial bank fails to make a profit\nB when a commercial bank needs to raise share capital\nC when a commercial bank reduces its lending rates\nD What is likely to increase the bargaining power of a trade union?\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nwhen the economy is experiencing rising cyclical unemployment\nA when the labour market moves from long-term to short-term contracts of employment\nB when the price elasticity of demand for the product is price-elastic\nC when the trade union supplies all the labour required by the employer\nD What is a likely reason why firms do not grow in size?\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nExternal diseconomies of scale occur at high levels of output.\nA Internal economies of scale occur at high levels of output.\nB Internal economies of scale occur at low levels of output.\nC Internal diseconomies of scale occur at low levels of output.\nD The table shows the activities of four firms.\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nfirm 4\nfirm 3\nfirm 2\nfirm 1\nshoe\nretailer\nshoe\nmanufacture\nwebsite\ndesign\nshoe\nmanufacture\nWhich combination of firms would be an example of horizontal integration?\n3 and 4\nD 2 and 4\nC 1 and 3\nB 1 and 2\nA What is a reason why firms making similar products sometimes locate near each other?\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nCompetition is decreased.\nA There are external economies of scale.\nB There are internal economies of scale.\nC Transport costs may be eliminated.\nD A government wishes to increase its spending on public goods.\nWhich sector should have a spending increase to achieve this?\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \neducation\nA healthcare\nB national defence\nC railways\nD Which government measure would lead directly to more exports of goods?\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \na devaluation of the currency\nA a restriction of bank credit creation\nB an increase in the rate of interest\nC the issue of more bank notes and coins\nD A government wishes to stimulate economic recovery.\nWhich action will assist this?\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \ndecreasing government investment\nA decreasing income tax\nB increasing indirect taxation\nC increasing interest rates\nD What is the most likely effect on an economy of a successful supply-side policy?\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nan increase in the general price level\nA an increase in the interest rate\nB an increase in the money supply\nC an increase in the potential GDP\nD A country is experiencing high economic growth caused by an increase in consumer spending.\nWhat are the most likely effects on inflation and unemployment?\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \ninflation falls and unemployment falls\nA inflation falls and unemployment rises\nB inflation rises and unemployment falls\nC inflation rises and unemployment rises\nD Which pair is most likely to be provided by the private sector in a mixed economy?\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \ncourts and prisons\nA hospitals and tax collection\nB insurance and banks\nC weapon manufacture and defence\nD An economy is experiencing a sustained fall in the general price level.\nWhich term is used to describe this?\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \ndeflation\nA depreciation\nB market disequilibrium\nC recession\nD What is most likely to cause an increase in relative poverty?\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nan increase in state benefits\nA an increase in the national minimum wage\nB pension increases below the rate of inflation\nC people working beyond retirement age\nD What might explain the high population growth in some developing countries?\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nhigh birth rates and falling death rates\nA low immigration and high emigration\nB falling birth rates and rising death rates\nC falling life expectancy\nD Which combination of factors might cause a country to be classified as developing rather than\ndeveloped?\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \na government budget deficit and a low death rate\nA a high birth rate and a low death rate\nB a large population and a current account deficit\nC a poor education system and a low standard of living\nD What is certain to encourage a higher level of international trade?\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nembargo\nA exchange control\nB quota\nC tariff\nD A developing country\u2019s two major sources of income from international trade are fishing and tourism.\nIf the country\u2019s exchange rate depreciated, what is likely to happen?\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nImported goods would become cheaper for local people.\nA The country would definitely become poorer.\nB The price of fish sold as exports would become cheaper.\nC Tourists to the country would be discouraged by higher prices.\nD What is the correct formula for calculating the current account of the balance of payments?\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nbalance of trade in goods + balance of trade in services + primary income balance +\nsecondary income balance\nA government revenue from abroad \u2013 domestic government spending\nB C\ntotal exports of services + total imports of goods\nD BLANK PAGE\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nWhich of the following is an advantage of the market economic system?\nA It aims for equality of income.\nB It ensures the provision of defence and law and order.\nC It gives an incentive to produce.\nD It reduces pollution and congestion.\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nA student defined opportunity cost as \u2018the alternative given up when a course of action is\nfollowed\u2019.\nWhy is this definition inadequate?\nA The \u2018next best\u2019 alternative is not stressed.\nB The type of economic system is not identified.\nC There is no mention of money values.\nD There is no reference to finite resources and unlimited wants.\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nWhy did planned economies often experience long queues for consumer goods?\nA The factors of production were able to move freely.\nB The distribution of goods was inefficient.\nC The output decisions were taken to maximise profits.\nD The needs of consumers determined production.\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nMr Lee bought shares in Intel, a computer company producing throughout the world.\nSandip Patel owns and runs a grocery store.\nWhich of the following is not represented by the above businesses?\nA co-operative\nB multi-national company\nC public company\nD sole proprietor\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nIn what circumstances are trade unions more likely to be effective in wage negotiations for their\nmembers?\nA an economic boom\nB a recession\nC a period of declining productivity\nD a period of rising unemployment\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nWhat function do central banks and commercial banks have in common?\nA acting as a banker's bank\nB controlling monetary policy\nC dealing with foreign exchange\nD supervising the banking system\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nA government taxes the production of cars.\nWhat is likely to decrease?\nA the cost of supplying cars\nB the price of cars\nC the revenue for the government\nD the supply of cars at every price\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nWhich government policy is most likely to encourage an experienced teacher to remain in the\nteaching profession?\nA increasing alternative career opportunities\nB increasing class sizes in schools\nC increasing teachers\u2019 working hours\nD increasing the levels of teachers\u2019 salaries\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nIn 2002 a car manufacturer closed one of its large factories and released its stocks of cars onto\nthe market.\nWhat was likely to happen to the price of the manufacturer\u2019s cars and the wages of car workers\nas a result?\nprice of cars\nwages of car workers\nA fall\nfall\nB fall\nrise\nC rise\nfall\nD rise\nrise\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \n14\n20\n25\n17\n30\n30\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \n40\n35\n27\nWhat level of output gives maximum profit?\nA 10 units\nB 20 units\nC 30 units\nD 40 units\n20\nThe diagram shows the average earnings per hour of postal workers between 1999 and 2001.\n1999\n2001\n2000\nyear\naverage earnings\npostal workers\n($ per hour)\n9 10\n8 0\nWhich of the following could explain the above diagram?\nA a reduction in trade union membership\nB the introduction of more efficient work practices\nC the employment of more part-time workers\nD an increase in the number of hours worked\n21\nThe table shows the costs incurred by a firm producing computers.\noutput (000s)\ntotal costs ($000)\n0 20\n1 1200\n2 1350\n3 1450\nWhat are the fixed costs if 3000 computers are produced?\nA $20 000\nB $1 430 000\nC $1 450 000\nD $4 020 000\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nA recent newspaper report stated that there was a proposal for two companies to merge to\nachieve greater efficiency. As a result a quarter of the workforce and some offices would no\nlonger be required.\nWhat does this statement suggest would happen if the two companies were merged?\nA average costs would rise\nB diseconomies of scale would occur\nC fixed and variable costs would decrease\nD profits would fall\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nWhen it produces 200 units, a firm's total variable cost is $600 and its total fixed cost is $2000.\nWhat is the average cost at this output?\nA $3\nB $10\nC $13\nD $2600\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nWhich measure of a firm\u2019s size would a government use to identify a monopoly?\nA the amount of profits earned by the firm in one year\nB the firm\u2019s percentage share of the market for its goods\nC the number of factories operated by the firm\nD the value of the firm\u2019s capital\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nA government decided to increase its spending on building schools and hospitals.\nWhich aim of government policy is most likely to be achieved by this?\nA balance of payments surplus\nB economic growth\nC price stability\nD stronger exchange rate\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nWhat is most likely to cause the government to have a budget surplus?\nA an increase in exports\nB an increase in unemployment\nC a decrease in government spending\nD a decrease in private sector investment\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nWhich of the following government policies would lead to a more even distribution of income?\nA allowing a balance of payments deficit\nB a change in the rate of exchange\nC control of lending by commercial banks\nD expenditure on unemployment benefits\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nWhich of the following is an aim of government policy?\nA income tax\nB interest rates\nC stable prices\nD unemployment\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nA person pays $500 tax when earnings are $5000.\nWhich of the following tax payments would indicate that the country has a regressive tax system\nif his income rose to $12 000?\nA $1000\nB $1200\nC $1500\nD $2400\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nWhich of the following is a reason for collecting national income statistics?\nA to calculate population changes\nB to compare standards of living\nC to fix exchange rates\nD to keep inflation low\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nIn order to reduce unemployment, a government moves one of its departments to a different part\nof the country, even though this is expensive.\nWhich type of unemployment is most likely to be reduced?\nA cyclical\nB frictional\nC regional\nD seasonal\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nA newspaper reported that a country's economy had grown by 3% during the last year.\nWhat must have increased in that year?\nA costs of production\nB gross domestic product\nC unemployment\nD wage levels\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nWhich of the following countries is likely to have the lowest standard of living?\ncountry\nA B\nC D\nbirth rate\n25\n43\n25\n36\ndeath rate\n10\n31\n5 14\nlife expectancy\n57\n40\n72\n48\ninfant mortality\n24\n42\n22\n56\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nWhat is the most likely cause of a fall in the population growth of a developing country?\nA a decrease in the birth rate\nB a decrease in emigration\nC a decrease in immigration\nD a decrease in the standard of living\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nWhich of the following would an economist use to measure living standards?\nA the average size of families\nB the gross domestic product per head\nC the number of workers in agriculture\nD the size of cities\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nWhat is always a feature of a mixed economy?\nA All capital goods are produced in the public sector.\nB Resources are used in the public and the private sector.\nC The allocation of all resources is determined by the price mechanism.\nD The public sector is larger than the private sector.\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nA woman playing a quiz game starts with no money, but correctly answers the question that is\nworth $4000. The next question is worth $10 000 but if she answers incorrectly she will leave the\ngame with no money.\n\nWhat is her opportunity cost of choosing to answer the $10 000 question if her answer is\nincorrect?\nA nothing\nB $4000\nC $6000\nD $10 000\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nWhich of the following is an example of the factor of production \u2018capital\u2019?\nA a truck\nB a truck driver\nC a truck driver\u2019s savings\nD a truck driver\u2019s wage\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nWhy do bank notes function as money?\nA They are durable.\nB They are generally acceptable.\nC They count as legal tender.\nD They have intrinsic value.\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nWhat is usually a function of a trade union?\nA It advertises the products that the members make.\nB It appoints company employees.\nC It negotiates with employers for increased wages.\nD It negotiates with suppliers for reduced costs of materials.\n\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nShares in the Japanese part of the American fast-food giant McDonald's hit an all-time low in\nAugust 2002. Sales at McDonald's 3800 restaurants in Japan fell dramatically despite the\nassurance that the company used only imported beef, which was free from a disease affecting\nJapanese cows.\n\nFrom the above statement what is true about McDonald's?\nA It is a multi-national because it has 3800 restaurants.\nB It is a multi-national because it imports raw materials.\nC It is a public company because it issues shares on the stock exchange.\nD It is a public company because it operates in America and Japan.\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \n\u2018International companies have made substantial investments in computer production in India.\nIndia is now a major centre of the world computer industry. Profit margins are high since labour\ncosts are a tenth of those in the USA.\u2019\n\nWhat does this suggest is the reason for companies locating in India rather than in the USA?\nA access to cheap land\nB availability of capital investment\nC availability of investment funds\nD competitive wage rates\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nTo whom does the central bank usually make loans?\nA individuals\nB limited companies\nC the government\nD trade unions\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nWhen will a trade union be most effective in pursuing its members' interests?\nA The economy is in recession with rising unemployment.\nB The employers have few orders for the product.\nC The government passes a law to increase competition in the labour market.\nD The members' wages make up a small part of total costs.\n\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: The world price of cocoa has been falling while the prices of products made from cocoa have\nbeen rising.\n\nWhich combination might explain this?\n\n\nmarket for cocoa\nadvertising expenditure\non products made from cocoa\nA excess demand\ndecrease\nB excess supply\ndecrease\nC excess demand\nincrease\nD excess supply\nincrease\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: Which combination is most likely to result in lower rates of pay?\n\n\nsupply of workers\nproductivity of workers\nA falls\nfalls\nB falls\nrises\nC rises\nfalls\nD rises\nrises\n\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: Point X shows the original equilibrium in the market for nurses in a country.\n\nThere is a fall in the number of people who wish to be trained as nurses.\n\nWhat is the new equilibrium point?\n\nO number of nurses employed\nwage rate\nA B\nC D\nX D1\nD2\n\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: What is likely to be the effect of a fall in interest rates on a consumer's borrowing and saving?\n\n\nborrowing\nsaving\nA falls\nfalls\nB falls\nrises\nC rises\nfalls\nD rises\nrises\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: What is most likely to cause the percentage of income saved in an economy to rise?\nA a rise in consumer confidence\nB a rise in direct taxation\nC a rise in unemployment\nD a rise in wage rates\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: What is not a factor of production?\nA a $10 note\nB a farm\nC a printing machine\nD a teacher\n\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: Which cost incurred by a firm manufacturing shirts is a variable cost?\nA buildings insurance\nB interest on bank loans\nC raw materials\nD rent on property\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: What is most likely to happen as unemployment falls?\nA Economic growth falls.\nB Inflation falls.\nC Spending on welfare benefits rises.\nD Tax revenue rises.\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: The US trades with Uruguay. In 2002 the US approved a loan of US$ 1.5 billion to Uruguay to\nhelp boost Uruguay's economy.\n\nWhat would be the most likely effect of this loan?\nA It would encourage Uruguay to import from the US.\nB It would make Uruguay less competitive.\nC It would result in imported inflation.\nD It would stop US citizens investing in Uruguay.\n\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: In September 2002 a government minister warned that tax changes were necessary to\nredistribute wealth from rich to poor.\n\nWhich policy would be likely to achieve that aim?\n\n\nregressive taxes\nprogressive taxes\nA decrease\nincrease\nB increase\ndecrease\nC increase\nunchanged\nD unchanged\ndecrease\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \u2018The pound sterling made a dramatic recovery in the world's currency markets yesterday.\u2019\n\nTo what does this statement refer?\nA exchange rate\nB growth rate\nC interest rate\nD tax rate\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: Which aim of government policy is most likely to be achieved by a decrease in government\nspending?\nA economic growth\nB equality of income\nC full employment\nD price stability\n\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: A survey of employment in a particular economy shows that the primary sector was diminishing in\nimportance and more people were being employed in the tertiary sector.\n\nWhat does this mean?\nA Fewer people were employed by central government.\nB Fewer people were employed in manufacturing industries.\nC More people were employed in the service industries.\nD More people were employed in agriculture.\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: A newspaper reports that there has been economic growth in an economy.\n\nWhat does this mean to an economist?\nA Population has increased.\nB Production has increased.\nC Saving has increased.\nD Taxation has increased.\n\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: Which of the following is the most obvious sign of inflation?\nA an increase in imports\nB a rise in the national debt\nC a rise in the rate of interest\nD a rise in retail prices\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: The following extract appeared in an international newspaper.\n\nChina\u2019s unemployed peasants flock to cities\n\nHundreds of thousands of peasants, fleeing rural\npoverty and drudgery, have flocked into China\u2019s cities\nseeking work.\n\nWhat would be the most likely result for the Chinese economy?\nA a reduction in productivity\nB a rise in unemployment in the city areas\nC a rise in the amount of unemployment in rural areas\nD a rise in the proportion of skilled labour in cities\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: The population of some developed countries is expected to fall in the next 25 years and the\naverage age of the population is expected to rise.\n\nWhich of the following is likely to cause this?\n\n\nbirth rate\ndeath rate\nA fall\nfall\nB fall\nrise\nC rise\nfall\nD rise\nrise\n\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: What is usually found in a developed country?\nA a high GDP per head with a low level of employment\nB a high level of labour skills with a low level of car ownership\nC a high rate of adult literacy with a low level of poverty\nD a high rate of population growth with a low level of labour productivity\n\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: The Egyptian government reduced tariffs on imported Japanese trucks.\n\nWhat is most likely to benefit in Egypt from this reduction?\nA government revenue\nB the balance of payments\nC truck operators\nD truck producers\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: A tax on which of the following would most reduce external costs?\nA bicycles\nB bus fares\nC cars\nD ferry services\n\nBLANK PAGE\n\n\nBLANK PAGE\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nWhat is always a feature of a mixed economy?\nA All capital goods are produced in the public sector.\nB Resources are used in the public and the private sector.\nC The allocation of all resources is determined by the price mechanism.\nD The public sector is larger than the private sector.\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nA woman playing a quiz game starts with no money, but correctly answers the question that is\nworth $4000. The next question is worth $10 000 but if she answers incorrectly she will leave the\ngame with no money.\n\nWhat is her opportunity cost of choosing to answer the $10 000 question if her answer is\nincorrect?\nA nothing\nB $4000\nC $6000\nD $10 000\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nWhat will increase the level of specialisation in an economy?\nA A computer manufacturer takes over an advertising company.\nB A retail store issues its own credit card.\nC A travel agent provides transport to the airport.\nD A vehicle assembler reduces its range of vehicles.\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nWhy do bank notes function as money?\nA They are durable.\nB They are generally acceptable.\nC They count as legal tender.\nD They have intrinsic value.\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nWhat is usually a function of a trade union?\nA It advertises the products that the members make.\nB It appoints company employees.\nC It negotiates with employers for increased wages.\nD It negotiates with suppliers for reduced costs of materials.\n\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nShares in the Japanese part of the American fast-food giant McDonald's hit an all-time low in\nAugust 2002. Sales at McDonald's 3800 restaurants in Japan fell dramatically despite the\nassurance that the company used only imported beef, which was free from a disease affecting\nJapanese cows.\n\nFrom the above statement what is true about McDonald's?\nA It is a multi-national because it has 3800 restaurants.\nB It is a multi-national because it imports raw materials.\nC It is a public company because it issues shares on the stock exchange.\nD It is a public company because it operates in America and Japan.\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \n\u2018International companies have made substantial investments in computer production in India.\nIndia is now a major centre of the world computer industry. Profit margins are high since labour\ncosts are a tenth of those in the USA.\u2019\n\nWhat does this suggest is the reason for companies locating in India rather than in the USA?\nA access to cheap land\nB availability of capital investment\nC availability of investment funds\nD competitive wage rates\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nTo whom does the central bank usually make loans?\nA individuals\nB limited companies\nC the government\nD trade unions\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nWhen will a trade union be most effective in pursuing its members' interests?\nA The economy is in recession with rising unemployment.\nB The employers have few orders for the product.\nC The government passes a law to increase competition in the labour market.\nD The members' wages make up a small part of total costs.\n\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: If \u2018Sunshine Oranges\u2019 were successfully advertised with the statement \u2018They help you live longer\u2019,\nwhich would be likely to occur?\n\n\nprice elasticity\nof demand\ntotal revenue\nA fall\nfall\nB fall\nrise\nC rise\nfall\nD rise\nrise\n\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: Which will encourage domestic producers to grow more maize?\nA granting subsidies to maize producers\nB increasing the sales tax on maize\nC removing guaranteed minimum prices for maize\nD removing quotas on imported maize\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: The world price of cocoa has been falling while the prices of products made from cocoa have\nbeen rising.\n\nWhich combination might explain this?\n\n\nmarket for cocoa\nadvertising expenditure\non products made from cocoa\nA excess demand\ndecrease\nB excess supply\ndecrease\nC excess demand\nincrease\nD excess supply\nincrease\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: Which combination is most likely to result in lower rates of pay?\n\n\nsupply of workers\nproductivity of workers\nA falls\nfalls\nB falls\nrises\nC rises\nfalls\nD rises\nrises\n\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: Point X shows the original equilibrium in the market for nurses in a country.\n\nThere is a fall in the number of people who wish to be trained as nurses.\n\nWhat is the new equilibrium point?\n\nO number of nurses employed\nwage rate\nA B\nC D\nX \n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: What is likely to be the effect of a fall in interest rates on a consumer's borrowing and saving?\n\n\nborrowing\nsaving\nA falls\nfalls\nB falls\nrises\nC rises\nfalls\nD rises\nrises\n\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: 00\n2001\nkey\nprimary\nsecondary\n\n\nWhat happened in this period?\nA Average earnings in the primary sector grew faster than those in the secondary sector.\nB Earnings in the secondary sector were a larger proportion of total cost than those in the\nprimary sector.\nC Total earnings in the secondary sector were higher than those in the primary sector.\nD Workers in both sectors benefited from a continuous rise in average earnings.\n\n\n20 A large clothing manufacturer expanded by acquiring retail clothing outlets.\n\nOf what is this an example?\nA diversification\nB external economies of scale\nC horizontal integration\nD vertical integration\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: Which cost incurred by a firm manufacturing shirts is a variable cost?\nA buildings insurance\nB interest on bank loans\nC raw materials\nD rent on property\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: Fifty people are employed in a business to produce 10 000 units per week.\n\nThe weekly costs are:\n\n\n$ hire of machinery\n230\npower\n200\nraw materials\n1000\nwages per employee\n40\n\nWhat are the variable costs for the week?\nA $1200\nB $1430\nC $1470\nD $3200\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: What is most likely to happen as unemployment falls?\nA Economic growth falls.\nB Inflation falls.\nC Spending on welfare benefits rises.\nD Tax revenue rises.\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: The US trades with Uruguay. In 2002 the US approved a loan of US$ 1.5 billion to Uruguay to\nhelp boost Uruguay's economy.\n\nWhat would be the most likely effect of this loan?\nA It would encourage Uruguay to import from the US.\nB It would make Uruguay less competitive.\nC It would result in imported inflation.\nD It would stop US citizens investing in Uruguay.\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: In September 2002 a government minister warned that tax changes were necessary to\nredistribute wealth from rich to poor.\n\nWhich policy would be likely to achieve that aim?\n\n\nregressive taxes\nprogressive taxes\nA decrease\nunchanged\nB increase\ndecrease\nC increase\nunchanged\nD unchanged\ndecrease\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \u2018The pound sterling made a dramatic recovery in the world's currency markets yesterday.\u2019\n\nTo what does this statement refer?\nA exchange rate\nB growth rate\nC interest rate\nD tax rate\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: Which aim of government policy is most likely to be achieved by a decrease in government\nspending?\nA economic growth\nB equality of income\nC full employment\nD price stability\n\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: A survey of employment in a particular economy shows that the primary sector was diminishing in\nimportance and more people were being employed in the tertiary sector.\n\nWhat does this mean?\nA Fewer people were employed by central government.\nB Fewer people were employed in manufacturing industries.\nC More people were employed in the service industries.\nD More people were employed in agriculture.\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: A newspaper reports that there has been economic growth in an economy.\n\nWhat does this mean to an economist?\nA Population has increased.\nB Production has increased.\nC Saving has increased.\nD Taxation has increased.\n\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: A country is experiencing inflation.\n\nWhat must be increasing?\nA wage levels\nB the output of goods and services\nC the amount of money spent on goods and services\nD the amount of money needed to purchase a given quantity of goods and services\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: The following extract appeared in an international newspaper.\n\n\n\n\n\n\n\n\nWhat would be the most likely result for the Chinese economy?\nA a reduction in productivity\nB a rise in unemployment in the city areas\nC a rise in the amount of unemployment in rural areas\nD a rise in the proportion of skilled labour in cities\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: There is a decrease in a country\u2019s birth rate.\n\nWhat can lead to an increase in the country\u2019s population at the same time?\nA Zero net migration and a fall in the fertility rate.\nB Zero net migration and a fall in infant mortality.\nC Positive net migration and a fall in the death rate.\nD Positive net migration and a fall in the fertility rate.\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: What is usually found in a developed country?\nA a high GDP per head with a low level of employment\nB a high level of labour skills with a low level of car ownership\nC a high rate of adult literacy with a low level of poverty\nD a high rate of population growth with a low level of labour productivity\n\n\nChina\u2019s unemployed peasants flock to cities\n\nHundreds of thousands of peasants, fleeing\nrural poverty and drudgery, have flocked into\nChina\u2019s cities seeking work.\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nA government decides to spend more on defence and therefore cannot spend as much on\nimproving the country\u2019s infrastructure.\n\nWhat economic idea is illustrated by this decision?\nA budget surplus\nB monetary policy\nC opportunity cost\nD specialisation\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nCountries that have changed from command to market economies will expect to find an increase\nin\nA choice.\nB price control.\nC rationing.\nD subsidies.\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \n\u2018The tertiary sector of the economy is increasing in importance\u2019.\n\nThis statement is most likely to mean that a higher proportion of the labour force is\nA being educated.\nB employed in manufacturing.\nC employed in the production of services.\nD unemployed but looking for work.\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nA hospital cannot treat all the people that need treatment.\n\nThis is an example of\nA excess supply.\nB limited wants.\nC scarcity.\nD unlimited resources.\n\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nThe following report appeared in a newspaper.\n\n\u2018The Chinese government is to allow the cigarette producer, BAT, to set up new factories in\nChina.\u2019\n\nWhat type of organisation is BAT likely to be?\nA a multi-national company\nB a partnership\nC a private company\nD a public corporation\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nWhy might a country\u2019s central bank raise its interest rate?\nA to encourage saving\nB to increase the money supply\nC to raise funds for the government\nD to reduce the level of employment\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nUK flights were severely disrupted in August 2004 after a pay dispute involving trade union\nmembers.\n\nWhich change would the union not have used to support their pay claim?\nA a downturn in the booking of flights\nB a fall in the real wages of airline staff\nC an increase in the airlines\u2019 profits\nD a rise in inflation\n\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nThe demand for and supply of a good both change. As a result the price of the good rises but the\nquantity traded remains the same.\n\nWhat must have happened to demand and supply?\n\n\ndemand\nsupply\nA fallen\nfallen\nB fallen\nrisen\nC risen\nfallen\nD risen\nrisen\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: In January 2005 house prices in the UK fell.\n\nWhat might have caused this?\nA Average incomes rose.\nB Interest rates fell.\nC The number of buyers rose.\nD The number of houses for sale rose.\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: What is likely to reduce the price of Air Namibia\u2019s flights?\nA increased competition from new airline companies\nB increased demand for flights\nC increased oil prices\nD increased wages for airline staff\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: Which feature of working in an occupation might tend to keep the basic wage rate down?\nA handling dangerous materials\nB receiving commission payments\nC undertaking training\nD working unsocial hours\n\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: An athlete needs an income and also needs time for training and competitions.\n\nWhich occupation is most appropriate for the athlete?\nA department store manager who is paid a salary\nB livestock farmer working for profit\nC assembly-line worker who is paid a wage\nD self-employed photographer\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: Which change would be most likely to cause the earnings of hotel managers in Mauritius to rise\nmore than the earnings of sugar cane workers there?\nA a decrease in the supply of sugar cane workers in Mauritius\nB a decrease in the price of hotel rooms in Mauritius\nC an increase in the productivity of hotel managers in Mauritius\nD an increase in the price of sugar cane from Mauritius\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: On average, male employees are paid more than female employees.\n\nWhat could be a reason for this?\nA A higher percentage of female employees belong to trade unions.\nB A higher percentage of females work in unskilled occupations.\nC Females have a longer working life.\nD There are fewer female employees.\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: What is most likely to increase a firm\u2019s profits?\nA government controls on its prices\nB grants for the purchase of new machines\nC an increase in the wages paid to its workers\nD rising costs of its raw materials\n\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \n20\n9 22\n17\n8 24\n14\n7 26\n11\n\n\nAt the equilibrium price, what will be the total expenditure on coffee?\nA $10\nB $20\nC $200\nD $400\n\n\n20 What is the most likely reason for a company to employ more workers?\nA increased demand for its product\nB increased taxes on the product\nC investment in labour-saving machinery\nD wage rises in the company\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: How is the average cost of a product calculated?\nA by adding total variable and total fixed costs\nB by dividing total cost by output\nC by multiplying total variable cost by output\nD by subtracting fixed cost from total cost\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: Which of a firm\u2019s costs do not change as production changes?\nA average cost\nB fixed cost\nC total cost\nD variable cost\n\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: When is a government said to balance its budget?\nA when all goods and services are taxed equally\nB when economic growth is the same in all regions of the economy\nC when total exports equal total imports\nD when its total income equals its total expenditure\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: What is a long-term advantage of economic growth?\nA Employment falls.\nB Incomes rise.\nC Prices rise.\nD Savings fall.\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: The governments of many countries raise revenue from a tax on a wide range of essential goods\nand services.\n\nWhat is the nature of this tax?\nA It is direct and proportional.\nB It is direct and regressive.\nC It is indirect and proportional.\nD It is indirect and regressive.\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: A country has a proportional system of taxation.\n\n\nA person pays $500 tax when earnings are $5000.\n\nHow much tax will be paid if earnings rise to $12 000?\nA $120\nB $500\nC $1200\nD $7500\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: Which of the following is not included in public expenditure?\nA capital spending by companies\nB interest payments on government borrowing\nC investment in defence by the central government\nD subsidies to bus companies from local government\n\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: What would not be recorded in the current account of Argentina\u2019s balance of payments?\nA An Argentine company builds a factory in Kenya.\nB An Argentine insurance company insures an American ship.\nC Argentine beef is sold to South Africa.\nD A large group of Italians visit Argentina.\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: A country has a surplus on its trade in goods and services of $20 m and a deficit on its current\naccount of $10 m.\n\nWhat position on its current income balance and current transfer balance is consistent with this?\n\n\ncurrent income balance\n($m)\ncurrent transfer balance\n($m)\nA +20\n+10\nB +10\n\u201330\nC \u201310\n\u201320\nD \u201320\n+10\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: The UK pound depreciates against the US dollar from \u00a31 = $1.80 to \u00a31 = $1.50.\nWhat does this mean?\nA UK imports from the US will cost less.\nB US imports from the UK will cost more.\nC UK pounds will be dearer in terms of US dollars.\nD US dollars will be dearer in terms of UK pounds.\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: A person receives annual interest of 4 % on their saving. Inflation is 5 % per annum.\n\nWhat is the change in the real value of their saving?\nA It falls 1 %.\nB It rises 4 %.\nC It falls 5 %.\nD It rises 9 %.\n\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: The French government bought 30 % of a private French industrial group which was facing\neconomic difficulties.\n\nWhat might be a possible result of this?\nA a budget deficit\nB an increase in the role of the consumer\nC an increase in the role of the market system\nD a reduction in central planning\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: In a country the birth rate increased but the population decreased.\n\nWhat could have happened to other factors to cause this?\nA no change in migration but the death rate fell\nB a fall in infant mortality but no change in the death rate\nC no change in migration but the death rate rose\nD a rise in net immigration but no change in the death rate\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: Which of the following is usually found in a developed economy?\n\n\nlow\nhigh\nA birth rate\ngross domestic product per head\nB death rate\ninfant mortality rate\nC gross domestic product per head\nbirth rate\nD infant mortality rate\ndeath rate\n\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: How is the death rate defined?\nA the excess of deaths over births in any one year\nB the number of deaths of infants per thousand births\nC the number of deaths per year\nD the number of deaths per year per thousand of the population\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: What is a benefit of tariffs?\nA increased choice\nB increased government revenue\nC more competition\nD more trade\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: Many people in Zimbabwe want to buy foreign cars, which would be shipped by foreign\ncompanies.\n\nWhat happens if the Zimbabwe government removes the quota on the import of motor cars?\n\n\nbalance on trade in\ngoods\nbalance on trade in\nservices\nA improves\nno change\nB improves\nworsens\nC worsens\nno change\nD worsens\nworsens\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: A government must decide whether to build a new road. The road would bring work to a town, but\nwould destroy part of a forest.\n\nWho is most likely to oppose this?\nA conservationists\nB road builders\nC suppliers of road materials\nD the town\u2019s unemployed\n\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nA government decides to spend more on defence and, therefore, cannot spend as much on\nimproving the country\u2019s infrastructure.\n\nWhat economic idea is illustrated by this decision?\nA budget surplus\nB monetary policy\nC opportunity cost\nD specialisation\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nCountries that have changed from command to market economies will expect to find an increase\nin\nA choice.\nB price control.\nC rationing.\nD subsidies.\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nWhat makes an industry capital-intensive?\nA It employs many unskilled workers.\nB It manufactures expensive products.\nC It occupies sites on cheap land.\nD It uses a large amount of equipment and a small labour force.\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nWhat is an example of the factor of production enterprise?\nA a shop assistant\nB a shop\u2019s profits\nC a shop owner\nD a shopping centre\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nWhat makes Barclays Bank a public limited company?\n\nA It experiences economies of scale.\nB It has more than two directors.\nC It is quoted on the London Stock Exchange.\nD It operates in more than one country.\n\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nWhy might a country\u2019s central bank raise its interest rate?\nA to encourage saving\nB to increase the money supply\nC to raise funds for the government\nD to reduce the level of employment\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nA trade union is negotiating a wage rise for its members.\n\nWhat will increase the chance of the wage rise being granted?\nA The company\u2019s product has many substitutes.\nB The economy is entering a period of recession.\nC The government has made strike action illegal.\nD Wages are a small part of the company\u2019s costs.\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nThe demand for and supply of a good both change. As a result the price of the good rises but the\nquantity traded remains the same.\n\nWhat must have happened to demand and supply?\n\n\ndemand\nsupply\nA fallen\nfallen\nB fallen\nrisen\nC risen\nfallen\nD risen\nrisen\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: In a market there is a shortage of a good.\n\nWhat change would cause the market to come to an equilibrium?\nA an increase in demand\nB a decrease in supply\nC a fall in price\nD a rise in price\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: A firm changes the price of its product and finds that its revenue increases.\n\nWhat combination of price change and price elasticity of demand would have caused this?\n\n\nprice\nprice elasticity\nA falls\nbetween 0 and 1\nB falls\nequal to 1\nC rises\nbetween 0 and 1\nD rises\ngreater than 1\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: A government wishes to impose a tax on a good to raise revenue.\n\nIt would be most likely to achieve this aim if the price elasticity of demand for the good were\nA high.\nB infinite.\nC low.\nD unitary.\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: Which feature of working in an occupation might tend to keep the basic wage rate down?\nA handling dangerous materials\nB receiving commission payments\nC undertaking training\nD working unsocial hours\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: An athlete needs an income and also needs time for training and competitions.\n\nWhich occupation is most appropriate for the athlete?\nA department store manager who is paid a salary\nB livestock farmer working for profit\nC assembly-line worker who is paid a wage\nD self-employed photographer\n\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: Which change would be most likely to cause the earnings of hotel managers in Mauritius to rise\nmore than the earnings of sugar cane workers there?\nA a decrease in the supply of sugar cane workers in Mauritius\nB a decrease in the price of hotel rooms in Mauritius\nC an increase in the productivity of hotel managers in Mauritius\nD an increase in the price of sugar cane from Mauritius\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: What is most likely to increase a firm\u2019s profits?\nA government controls on its prices\nB grants for the purchase of new machines\nC an increase in the wages paid to its workers\nD rising costs of its raw materials\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \n20\n9 22\n17\n8 24\n14\n7 26\n11\n\n\nAt the equilibrium price, what will be the total expenditure on coffee?\nA $10\nB $20\nC $200\nD $400\n\n20 Which statement about fixed costs is correct?\nA They exist only in the long run.\nB They include raw material and direct labour costs.\nC They increase at the same rate as output.\nD They must be paid even if there is no output.\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: What is an example of backward vertical integration?\nA An aircraft manufacturer takes over an airline.\nB A bank takes over another bank.\nC A plastics manufacturer takes over a drinks firm.\nD A tyre manufacturer takes over a rubber plantation.\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: Which is a diseconomy of scale?\nA Bulk buying reduces costs.\nB Communications deteriorate.\nC Employees are more motivated.\nD Technological improvements take place.\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: What is a long-term advantage of economic growth?\nA Employment falls.\nB Incomes rise.\nC Prices rise.\nD Savings fall.\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: The governments of many countries raise revenue from a tax on a wide range of essential goods\nand services.\n\nWhat is the nature of this tax?\nA It is direct and proportional.\nB It is direct and regressive.\nC It is indirect and proportional.\nD It is indirect and regressive.\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: Why might a new indirect tax be undesirable?\nA It encourages firms to export.\nB It creates a more regressive tax system.\nC It produces a narrower basis of taxation.\nD It creates a more progressive tax system.\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: What would not be recorded in the current account of Argentina\u2019s balance of payments?\nA An Argentine company builds a factory in Kenya.\nB An Argentine insurance company insures an American ship.\nC Argentine beef is sold to South Africa.\nD A large group of Italians visit Argentina.\n\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: A country has a surplus on its trade in goods and services of $20 m and a deficit on its current\naccount of $10 m.\n\nWhat position on its current income balance and current transfer balance is consistent with this?\n\n\ncurrent income balance\n($m)\ncurrent transfer balance\n($m)\nA +20\n+10\nB +10\n\u201330\nC \u201310\n\u201320\nD \u201320\n+10\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: The UK pound depreciates against the US dollar from \u00a31 = $1.80 to \u00a31 = $1.50.\nWhat does this mean?\nA UK imports from the US will cost less.\nB US imports from the UK will cost more.\nC UK pounds will be dearer in terms of US dollars.\nD US dollars will be dearer in terms of UK pounds.\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: A person receives annual interest of 4 % on their saving. Inflation is 5 % per annum.\n\nWhat is the change in the real value of their saving?\nA It falls 1 %.\nB It rises 4 %.\nC It falls 5 %.\nD It rises 9 %.\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: What else is likely to rise when the rate of unemployment in a country rises?\nA business confidence\nB consumer spending\nC government revenue\nD government spending\n\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: In a country the birth rate increased but the population decreased.\n\nWhat could have happened to other factors to cause this?\nA no change in migration but the death rate fell\nB a fall in infant mortality but no change in the death rate\nC no change in migration but the death rate rose\nD a rise in net immigration but no change in the death rate\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: Which of the following is usually found in a developed economy?\n\n\nlow\nhigh\nA birth rate\nadult literacy rate\nB access to safe water\ninfant mortality rate\nC gross domestic product per head\naccess to safe water\nD infant mortality rate\ndeath rate\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: Which situation must produce an ageing population?\nA a falling birth rate and a falling death rate\nB a rising birth rate and a rising death rate\nC a rising fertility rate and a falling death rate\nD a rising marriage rate and a rising death rate\n\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: A developing country finds it difficult to export goods to a developed country.\n\nWhat could explain this?\nA The developing country\u2019s exchange rate has depreciated.\nB There are no tariffs on goods bought from the developing country.\nC There are quotas on goods bought from this developing country.\nD There is cheap labour in the developing country.\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: Many people in Zimbabwe want to buy foreign cars, which would be shipped by foreign\ncompanies.\n\nWhat happens if the Zimbabwe government removes the quota on the import of motor cars?\n\n\nbalance on trade in\ngoods\nbalance on trade in\nservices\nA improves\nno change\nB improves\nworsens\nC worsens\nno change\nD worsens\nworsens\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: A country\u2019s farmers specialise in a single cash crop for export.\n\nWhat might have encouraged this policy?\nA a fall in commodity prices\nB comparative advantage\nC diminishing returns\nD diseconomies of scale\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: Which action by the operators of an airport directly reduces external costs?\nA the abolition of night flights\nB the building of a new runway\nC the payment of a productivity bonus\nD the reduction of charges for landing aircraft\n\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nWhat is found in a command economy but not a market economy?\nA banks\nB division of labour\nC price controls\nD profit motive\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nCommercial companies are reclaiming marsh land to construct golf courses.\n\nWhat is the opportunity cost to society?\nA the expense of installing drainage\nB the natural environment that is lost\nC the profits of the companies\nD the value of the land cleared\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nThere are more people in developing countries who cannot read or write than in developed\ncountries.\n\nWhat can be concluded from this?\nA Developed countries will use more labour than capital as it is skilled.\nB In developing countries, factors of production are not used to their maximum potential.\nC Less money needs to be spent on education in developed countries than in developing\ncountries.\nD Production in developing countries is likely to rely more on capital than labour.\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nIn wartime conditions, cigarettes have been used as money.\n\nWhat disadvantage do cigarettes have for trading compared with notes and coins?\nA They cannot act as a medium of exchange.\nB They have no intrinsic value.\nC They lack durability.\nD They make a double coincidence of wants necessary.\n\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nA farmer employs one man to plough a large field.\n\nAs well as labour, which factors of production are involved in this activity?\nA land and capital only\nB land and enterprise only\nC capital and enterprise only\nD land, capital and enterprise\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nIn most countries which organisation controls the banking system?\nA central bank\nB commercial bank\nC investment bank\nD World Bank\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nIn 2001 some countries, including India and Pakistan, criticised the European Union for\ncontinuing to protect European farmers with a subsidy while expecting poorer African countries\nnot to restrict trade.\n\nWhat are not involved in this situation?\nA developing and developed economies\nB free trade and protection\nC market prices and official intervention\nD multi-nationals and public corporations\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nWhich type of business organisation has its shares quoted on a stock exchange?\nA private company\nB public company\nC co-operative\nD public corporation\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nWhat is the main purpose of a trade union?\nA to achieve profit maximisation\nB to encourage free trade\nC to promote private ownership of industry\nD to protect the interests of its members\n\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: Sometimes travel companies advertise holidays at prices below cost.\n\nWhat might be a reason for this?\nA an excess demand for holidays\nB an excess supply of holidays\nC a price inelastic demand for holidays\nD insufficient competition in the holiday market\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: A country imports oil which is used in the production and distribution of goods. The country has\nalso experienced a rise in incomes which has resulted in a large increase in the demand for\ngoods, some of which it imports.\n\nWhat is likely to happen to the country\u2019s balance of trade in goods and to the price of oil?\n\n\nbalance of trade in\ngoods\nprice of oil\nA worsens\nfalls\nB improves\nfalls\nC worsens\nrises\nD improves\nrises\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: X is the equilibrium point for a company that sells advertising space. During the year, the demand\nfor advertising decreased and the company\u2019s labour cost increased.\n\nWhat would be the new equilibrium?\n\nO quantity of advertising space\nprice of\nadvertising\nspace\nX A\nB C\nD \n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: In developed economies, as a person\u2019s real income rises, a lower proportion of that income is\nusually spent on\nA food.\nB holidays.\nC leisure activities.\nD personal transport.\n\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: What would cause disposable incomes to become less equal?\nA increased employment\nB increased welfare benefits\nC more progressive taxes\nD more regressive taxes\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: Which occupation would suit a person who wanted to work in the public sector?\nA a journalist for an independent newspaper\nB a nurse in a government hospital\nC a sales manager for a multi-national food business\nD a teacher in a private fee-paying school\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: Male workers on average get paid more than female workers.\n\nWhat might explain this?\nA Male workers have better qualifications.\nB Female workers are more likely to be in trade unions.\nC Male workers live nearer to their place of work.\nD Female workers are less likely to take time off work.\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: A firm manufactures toys.\n\nWhich cost will vary least as output and sales increase?\nA distribution to retailers\nB insurance payments on the factory\nC wages of production workers\nD raw materials\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: In 2005, world oil prices increased significantly.\n\nWhat effect would an increase in oil prices have on a firm that transports products for other firms?\nA average fixed costs would increase\nB profits would increase\nC total fixed costs would increase\nD variable costs would increase\n\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: Which statement is correct?\nA Average revenue is total revenue divided by output.\nB Fixed cost is total cost plus variable cost.\nC Total cost is variable cost multiplied by fixed cost.\nD Total revenue is fixed revenue minus variable revenue.\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: What is a firm seeking profit maximisation trying to achieve?\nA the fastest rate of profit growth\nB the highest level of profit per unit produced\nC the highest level of total profit\nD the lowest level of total cost\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: Which policy would best enable a government to encourage greater specialisation in the use of\nits country\u2019s resources?\nA encouraging diversification in industry\nB protecting small businesses\nC reducing tariffs on imports\nD subsidising job creation in rural areas\n\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: What could a government in a developed economy do to increase demand?\nA create a budget surplus\nB increase taxes\nC reduce government spending\nD reduce interest rates\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: What is not an aim of government economic policy?\nA economic growth\nB full employment\nC interest rates\nD stable prices\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: Which situation would definitely cause a fall in real incomes?\n\n\nprice level\nmoney income level\nA falls\nrises\nB falls\nunchanged\nC rises\nrises\nD rises\nunchanged\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: What would not be required in the construction of an index of consumer prices (retail price\nindex)?\nA the selection of a base year\nB the selection of a representative range of items\nC the calculation of average wage levels\nD the weighting of each item in the index\n\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: What is likely to lead to a decrease in structural unemployment?\nA reducing the interest rate\nB increasing the rate of unemployment benefit\nC reducing the rate of income tax\nD increasing labour mobility\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: What might explain the high population growth in some developing countries?\nA high birth rates and falling death rates\nB high immigration and low emigration\nC falling birth rates and rising death rates\nD falling life expectancy\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: Turkey\u2019s agricultural sector employs 48 % of the country\u2019s workforce compared with 17 % in the\nUS and 3.9 % in France.\n\nWhat could be concluded from this?\nA France is likely to import more agricultural produce than the US.\nB The workers in France are not as productive as those in Turkey.\nC Total agricultural production is likely to be higher in Turkey than in the US.\nD Turkey is likely to be less developed than France.\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: Changes in the standard of living of a country are best measured by changes in\nA national income.\nB national income per head.\nC real national income.\nD real national income per head.\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: As a country develops, what is most likely to happen?\nA A greater proportion of the workforce will be employed in the service sector.\nB The average age will decrease.\nC The birth rate will increase.\nD There will be reduced occupational mobility of labour.\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: Firms often advertise saying that they specialise in providing a certain product or service.\n\nWhat is an advantage of such specialisation?\nA Employees become experts in that area.\nB Employees can easily switch to other jobs.\nC Firms can quickly adapt production if their service is no longer required.\nD Production is dependent on other firms supplying components.\n\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: What directly sets a fixed limit on the quantity of goods which can be imported?\nA administrative regulations\nB foreign exchange controls\nC quotas\nD tariffs\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: A water pump has been invented which is operated when people play on a roundabout in the\nvillage. The roundabout provides the power to pump water from the well.\n\nOf what is this an example?\nA conserving labour and conserving natural resources\nB conserving labour and using natural resources\nC using labour and conserving natural resources\nD using labour and using natural resources\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: The governments of developing countries often allow multi-nationals to mine minerals in their\nterritory.\n\nWhich conflict between possible benefit and cost does this present to the developing country?\n\n\nbenefit\ncost\nA improved balance of trade\nincreased training by the companies\nB higher employment\nloss of finite resource\nC increased profits for the companies\nmore efficient production\nD more sustainable development\nfaster economic growth\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: The introduction of a tariff on imported goods is likely to\nA ensure that the domestic industry becomes more efficient.\nB increase the demand for domestically produced goods.\nC reduce the price of domestically produced goods.\nD reduce the price of imported goods into a country.\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nWhat is found in a market economy but not a command economy?\nA division of labour\nB economies of scale\nC money as a store of value\nD the profit motive\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nThere are more people in developing countries who cannot read or write than in developed\ncountries.\n\nWhat can be concluded from this?\nA Developed countries will use more labour than capital as it is skilled.\nB In developing countries, factors of production are not used to their maximum potential.\nC Less money needs to be spent on education in developed countries than in developing\ncountries.\nD Production in developing countries is likely to rely more on capital than labour.\n\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nIn wartime conditions, cigarettes have been used as money.\n\nWhat disadvantage do cigarettes have for trading compared with notes and coins?\nA They cannot act as a medium of exchange.\nB They have no intrinsic value.\nC They lack durability.\nD They make a double coincidence of wants necessary.\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nWhich economic question is least likely to arise as a result of scarcity?\nA For whom shall we produce?\nB How shall we produce?\nC What shall we produce?\nD When shall we produce?\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nIn most countries which organisation controls the banking system?\nA central bank\nB commercial bank\nC investment bank\nD World Bank\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nWhat advantage is gained by a company that becomes a multi-national?\nA It avoids trade barriers.\nB It reduces its fixed costs.\nC It simplifies its management structure.\nD It makes communication easier.\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nWhich pair of economic institutions would be found in a command economy?\nA central bank and public companies\nB public corporations and central bank\nC public corporations and stock exchange\nD stock exchange and public companies\n\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nWhat is the main purpose of a trade union?\nA to achieve profit maximisation\nB to encourage free trade\nC to promote private ownership of industry\nD to protect the interests of its members\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: Sometimes travel companies advertise holidays at prices below cost.\n\nWhat might be a reason for this?\nA an excess demand for holidays\nB an excess supply of holidays\nC a price inelastic demand for holidays\nD insufficient competition in the holiday market\n\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: Good X has a price elasticity of demand of 0.25 while good Y has a price elasticity of demand of\n1.5.\n\nA likely explanation of these values is that compared to good Y, good X\nA has more substitutes.\nB is considered more of a luxury.\nC is purchased more out of habit.\nD takes up a larger proportion of consumers\u2019 income.\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: A country imports oil which is used in the production and distribution of goods. The country has\nalso experienced a rise in incomes which has resulted in a large increase in the demand for\ngoods, some of which it imports.\n\nWhat is likely to happen to the country\u2019s balance of trade in goods and to the price of oil?\n\n\nbalance of trade in\ngoods\nprice of oil\nA worsens\nfalls\nB improves\nfalls\nC worsens\nrises\nD improves\nrises\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: X is the equilibrium point for a company that sells advertising space. During the year, the demand\nfor advertising decreased and the company\u2019s labour cost increased.\n\nWhat would be the new equilibrium?\n\nO quantity of advertising space\nprice of\nadvertising\nspace\nX A\nB C\nD \n\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: In developed economies, as a person\u2019s real income rises, a lower proportion of that income is\nusually spent on\nA food.\nB holidays.\nC leisure activities.\nD personal transport.\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: What would cause disposable incomes to become less equal?\nA increased employment\nB increased welfare benefits\nC more progressive taxes\nD more regressive taxes\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: The first worker in each pair of workers below is usually paid more.\n\nIn which case is this not likely to be the result of the first worker\u2019s greater value to the firm?\nA a worker in a trade union compared with a worker with no trade union\nB a worker with training compared with a worker with no training\nC a worker with supervisory responsibilities compared with a worker with no responsibility\nD a worker with years of experience compared with a worker with no experience\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: Which is the most important factor that affects how much a family saves?\nA the income of the family\nB the level of taxation\nC the rate of inflation\nD the reliability of banks\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: What is happening when a firm is experiencing diseconomies of scale?\nA It has rising long-run average costs.\nB It is operating in the short run.\nC Its fixed costs are less than variable costs.\nD Its output is increasing faster than its inputs.\n\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: In 2005, world oil prices increased significantly.\n\nWhat effect would an increase in oil prices have on a firm that transports products for other firms?\nA average fixed costs would increase\nB profits would increase\nC total fixed costs would increase\nD variable costs would increase\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: Which statement is correct?\nA Average revenue is total revenue divided by output.\nB Fixed cost is total cost plus variable cost.\nC Total cost is variable cost multiplied by fixed cost.\nD Total revenue is fixed revenue minus variable revenue.\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: What is a firm seeking profit maximisation trying to achieve?\nA the fastest rate of profit growth\nB the highest level of profit per unit produced\nC the highest level of total profit\nD the lowest level of total cost\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: In which case is success for the government in achieving the first aim likely to cause problems in\nachieving the second?\n\n\nfirst aim\nsecond aim\nA full employment\nprice stability\nB high economic growth\nfull employment\nC price stability\nstable balance of payments\nD stable balance of payments\nmore even distribution of income\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: What is a possible disadvantage of the changes caused by long-term economic growth?\nA rising cyclical unemployment\nB rising employment\nC rising seasonal unemployment\nD rising structural unemployment\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: A report predicted that South Africa\u2019s economy was likely to grow at 4.2 %.\n\nWhat might cause this growth?\nA an increase in exports\nB an increase in imports\nC an increase in interest rates\nD an increase in unemployment\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: A government wishes to increase demand in the economy.\n\nWhat should it reduce?\nA benefits to the unemployed\nB borrowing by consumers\nC spending on health and education\nD taxation\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: What would not be required in the construction of an index of consumer prices (retail price\nindex)?\nA the selection of a base year\nB the selection of a representative range of items\nC the calculation of average wage levels\nD the weighting of each item in the index\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: What is likely to lead to a decrease in structural unemployment?\nA reducing the interest rate\nB increasing the rate of unemployment benefit\nC reducing the rate of income tax\nD increasing labour mobility\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: What might explain the high population growth in some developing countries?\nA high birth rates and falling death rates\nB high immigration and low emigration\nC falling birth rates and rising death rates\nD falling life expectancy\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: Turkey\u2019s agricultural sector employs 48 % of the country\u2019s workforce compared with 17 % in the\nUS and 3.9 % in France.\n\nWhat could be concluded from this?\nA France is likely to import more agricultural produce than the US.\nB The workers in France are not as productive as those in Turkey.\nC Total agricultural production is likely to be higher in Turkey than in the US.\nD Turkey is likely to be less developed than France.\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: Botswana has achieved high rates of economic growth.\n\nWhat is most likely to have fallen as a result of this economic growth?\nA employment\nB income per head\nC infant mortality rate\nD literacy rates\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: As a country develops, what is most likely to happen?\nA A greater proportion of the workforce will be employed in the service sector.\nB The average age will decrease.\nC The birth rate will increase.\nD There will be reduced occupational mobility of labour.\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: Why might a country specialise in growing coffee?\nA It has comparative advantage in coffee production.\nB It needs a diversified economy.\nC Its export markets have tariffs on coffee imports.\nD Other countries subsidise coffee growing.\n\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: Why are schools provided by governments?\nA Education generates external costs.\nB The government controls the numbers of teachers.\nC Schools are too expensive for the private sector to provide.\nD The whole country can benefit from the provision of education.\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: A water pump has been invented which is operated when people play on a roundabout in the\nvillage. The roundabout provides the power to pump water from the well.\n\nOf what is this an example?\nA conserving labour and conserving natural resources\nB conserving labour and using natural resources\nC using labour and conserving natural resources\nD using labour and using natural resources\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: Which effect is an external cost when an airport is developed on the edge of a city?\nA a reduction in local property values\nB a reduction in noise pollution\nC an increase in the profits of the railway company that serves the airport\nD an increase in transport links for the city\u2019s population\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: The introduction of a tariff on imported goods is likely to\nA ensure that the domestic industry becomes more efficient.\nB increase the demand for domestically produced goods.\nC reduce the price of domestically produced goods.\nD reduce the price of imported goods into a country.\n\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nWhat is not a factor of production?\nA company shares\nB machinery\nC raw materials\nD unskilled workers\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nWhat is a feature of a mixed economic system but not a planned economic system?\nA It has both industrial and service sectors.\nB It has both large and small firms.\nC It has both public and private sectors.\nD It has both rural and urban areas.\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nThe purchase of new machinery enables a firm to increase output with fewer workers.\n\nWhat is the effect on labour productivity and total costs?\n\n\nchange in labour\nproductivity\nchange in total costs\nA fall\nconstant\nB rise\nrise\nC rise\nuncertain\nD uncertain\nfall\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nIn many developing countries people grow agricultural products. They sell what they produce to\nbuy other goods.\n\nWhat is required for this system to work?\nA a subsistence economy\nB barter\nC money\nD ownership of land\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nA charity sold tickets at $5 each. A prize of $100 was given to the owner of the winning ticket.\n\nA student bought a ticket, but did not win.\n\nWhat is the opportunity cost to the student?\nA $5\nB $100\nC what could have been bought with the $5\nD what could have been bought with the $100\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nA company producing coffee in Europe has operations in Brazil and Kenya.\n\nWhat is a reason why a company might decide to have operations in more than one country?\nA availability of cheaper raw materials\nB easier central control of operations\nC greater risk of supply disruption\nD increased transport costs\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nIn which situation will a trade union be least likely to be effective in supporting the interests of its\nmembers?\nA The economy is experiencing an increase in unemployment.\nB The firms have a large increase in demand for the product.\nC The government passes a law weakening the powers of employers.\nD The workers\u2019 wages are a small proportion of total costs.\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nWhat is a characteristic of a public company?\nA It is owned and controlled by its members.\nB It is owned and controlled by its partners.\nC It is owned and controlled by its shareholders.\nD It is owned and controlled by the government.\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: In 2004, Dyson, a UK company, launched a luxury version of its vacuum cleaner in Japan.\n\nWithin two years, it became the top-selling vacuum cleaner in the country.\n\nWhat could have caused this increase in demand?\nA a fall in the population of Japan\nB a fall in the price of alternative vacuum cleaners in Japan\nC rising levels of unemployment in Japan\nD successful advertising of Dyson vacuum cleaners in Japan\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: Many people prefer to buy clothes from a local shop rather than travel to a specialist tailor to have\nthem made.\n\nWhich combination of characteristics of the local shop would make this most likely?\nA easily accessible shop\nhigh quality product\nmore expensive\nB easily accessible shop\naverage quality product\nless expensive\nC shop owner known to customer\naverage quality product\nmore expensive\nD shop owner known to customer\npoor quality product\nless expensive\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: In the UK in 2003, average hourly earnings for plumbers were higher than average hourly\nearnings for teachers.\n\nWhat was most likely to have caused this?\nA Plumbers were in short supply.\nB Plumbers had a shorter training period than teachers.\nC Plumbers had further to travel to work.\nD Plumbers worked longer hours than teachers.\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: What is most likely to cause an increase in wages in an industry?\nA a decrease in employment\nB a decrease in trade union power\nC an improvement in working conditions\nD an increase in the responsibilities of workers\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: Which type of income is earned by the factor of production enterprise?\nA interest\nB profit\nC rent\nD wages\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: What might cause an individual to save more?\nA a rise in direct taxation\nB a rise in insurance premiums\nC a rise in interest rates\nD a rise in the prices of foodstuffs\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: 25 % of both rural and urban consumers were reported to prefer products from Japan when\nbuying electronic goods.\n\nWhich combination of characteristics are the Japanese electronic goods likely to have which\npersuade consumers to make this choice?\n\n\ntechnology\nlength of guarantee\nrunning costs\nA latest\n12 months\nhigh\nB standard\n12 months\nlow\nC latest\n24 months\nlow\nD standard\n24 months\nhigh\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: The financial director of a company adds up the expenditure on items such as electricity, petrol\n(gas) and diesel fuel and raw materials. The director then divides that total by the firm\u2019s output.\n\nWhat has the director calculated?\nA average revenue\nB average fixed cost\nC average variable cost\nD average total cost\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: What must a firm do which aims to make as much profit as possible?\nA make revenue and costs equal\nB maximise the difference between total revenue and total cost\nC maximise revenue\nD minimise costs of production\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: The following report appeared in a newspaper.\n\n\u2018British American Tobacco (BAT), the cigarette producer, said it would invest $1.5 million in\nChina during the next two years as it set up new factories. China is estimated to be the\nworld\u2019s most important market for the sale of cigarettes.\u2019\n\nWhat is likely to happen to the total cost, total revenue and profit of BAT?\n\n\ntotal cost\ntotal revenue\nprofit\nA decrease\nincrease\nuncertain\nB decrease\ndecrease\nincrease\nC increase\nincrease\nuncertain\nD increase\ndecrease\nincrease\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: What can a small firm do more easily than a large firm?\nA adapt to changing fashions\nB have specialised managers\nC raise finance\nD undertake research and development\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: Which of the following is not included in public expenditure?\nA capital spending by public companies\nB expenditure by government departments\nC investment by nationalised industries\nD spending by local governments\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: What is most likely to improve the economic performance of a country in the long run?\nA a decrease in investment\nB a decrease in the school-leaving age\nC an increase in government spending on education\nD an increase in the rate of interest\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: What describes a regressive income tax?\nA As income rises the proportion of tax paid remains constant.\nB As income rises the tax rate on additional income falls.\nC As income rises the tax rate on additional income rises.\nD As income rises the total tax paid rises.\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: A high proportion of people in a developing country have very low incomes.\n\nWhich government policy would help reduce this level of poverty?\nA decreasing the tax on goods and services\nB decreasing housing subsidies\nC increasing import duties\nD increasing inheritance tax\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: When is there a budget surplus?\nA when government expenditure is greater than government revenue\nB when government revenue is greater than government expenditure\nC when imports are greater than exports\nD when exports are greater than imports\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: Which type of unemployment is likely to lead to the most serious regional problems in a country?\nA cyclical\nB frictional\nC residual\nD structural\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: The Gross Domestic Product (GDP) of Hong Kong rose more slowly than the rest of South East\nAsia between 1997 and 2002.\n\nWhat is the most likely reason?\nA a fall in competitiveness in Hong Kong\nB a fall in production costs in Hong Kong\nC an economic recession throughout South East Asia\nD a rise in productivity in Hong Kong\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: Which combination is most likely to be found in a developing country compared with a more\ndeveloped country?\n\n\npopulation growth rate\ndeath rate\nA higher\nhigher\nB higher\nlower\nC lower\nhigher\nD lower\nlower\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: Real Gross Domestic Product per head is often used as a measure of the change in average\nliving standards.\n\nWhat reduces its effectiveness in representing this change?\nA It omits increases in the cost of living.\nB It omits increases in the general price level.\nC It omits increases in the hours people work.\nD It omits increases in the size of the population.\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: What is usually found in a developed country?\nA a high proportion of workers in the tertiary sector\nB a high birth rate\nC a low level of technology\nD a low GDP per head\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: Which commercial activity will not destroy the natural environment?\nA intensive fishing in coastal waters using modern fishing boats\nB large-scale farming using chemical fertilisers\nC picking apples from trees using local labour\nD tree felling by timber companies in tropical forests\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: What lowers the cost of producing goods for export?\nA a quota\nB a subsidy\nC a tariff\nD foreign exchange control\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: Which of the following increases specialisation?\nA A farmer decides to convert some of his farm buildings into holiday cottages for rent.\nB A government decides that a country should be more self-sufficient in food production.\nC A restaurant owner decides to have only vegetarian meals on his menu.\nD A taxi driver decides to train for an additional licence to drive a bus.\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: A major market for bananas from Latin America is the European Union (EU). In 2006, the EU\nimposed a 35 % tariff on banana imports from Latin America but not on substitutes from other\nregions.\n\nWhat impact is the tax likely to have had on the price of Latin American bananas in the EU and\nthe revenue of Latin American producers?\n\n\nEU price of Latin\nAmerican bananas\nrevenue of Latin\nAmerican producers\nA decrease\ndecrease\nB decrease\nincrease\nC increase\nincrease\nD increase\ndecrease\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: The government of a major oil-exporting country decides to extract more oil and export it as\nrapidly as possible.\n\nWhat is the likely effect of this on the volume of oil exports and the price of oil?\n\n\nvolume of oil exports\nprice of oil\nA fall immediately\nfall in the long term\nB fall in the long term\nrise immediately\nC rise immediately\nfall immediately\nD rise in the long term\nrise in the long term\n\n\nBLANK PAGE\nBLANK PAGE\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nWhat is not a factor of production?\nA company shares\nB machinery\nC raw materials\nD unskilled workers\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nWhat is a feature of a mixed economic system but not a planned economic system?\nA It has both industrial and service sectors.\nB It has both large and small firms.\nC It has both public and private sectors.\nD It has both rural and urban areas.\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nThe purchase of new machinery enables a firm to increase output with fewer workers.\n\nWhat is the effect on labour productivity and total costs?\n\n\nchange in labour\nproductivity\nchange in total costs\nA fall\nconstant\nB rise\nrise\nC rise\nuncertain\nD uncertain\nfall\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nThe UK government gave subsidies to orchestras so that the number of concert performances\ncould be increased. However, the advertisements for these concerts caused such extra demand\nthat ticket prices rose despite the subsidy.\n\nWhat can be concluded about these changes?\nA the demand curve for concerts moved to the left\nB the government alone determined the market price\nC the market allocation of resources was altered\nD there is now no scarcity of resources available for concerts\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nA woman playing a quiz game starts with no money, but correctly answers the question that is\nworth $4000. The next question is worth $10 000 but if she answers incorrectly she will leave the\ngame with no money.\n\nWhat is her opportunity cost of choosing to answer the $10 000 question if her answer is\nincorrect?\nA nothing\nB $4000\nC $6000\nD $10 000\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nA company producing coffee in Europe has operations in Brazil and Kenya.\n\nWhat is a reason why a company might decide to have operations in more than one country?\nA availability of cheaper raw materials\nB easier central control of operations\nC greater risk of supply disruption\nD increased transport costs\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nIn which situation will a trade union be least likely to be effective in supporting the interests of its\nmembers?\nA The economy is experiencing an increase in unemployment.\nB The firms have a large increase in demand for the product.\nC The government passes a law weakening the powers of employers.\nD The workers\u2019 wages are a small proportion of total costs.\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nWhich disadvantage is likely to arise when a private company grows and becomes a public\ncompany?\nA Banks may have less confidence in its financial stability.\nB Customers may expect a reduced range of products.\nC Suppliers may be more uncertain about receiving payment for materials.\nD Workers may feel less motivated within a larger organisation.\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: 0\nB 1\n2 50\nC 10\n20\n20\nD 20\n5 1\n\n\n10 In 2004, Dyson, a UK company, launched a luxury version of its vacuum cleaner in Japan.\n\nWithin two years, it became the top-selling vacuum cleaner in the country.\n\nWhat could have caused this increase in demand?\nA a fall in the population of Japan\nB a fall in the price of alternative vacuum cleaners in Japan\nC rising levels of unemployment in Japan\nD successful advertising of Dyson vacuum cleaners in Japan\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: Many people prefer to buy clothes from a local shop rather than travel to a specialist tailor to have\nthem made.\n\nWhich combination of characteristics of the local shop would make this most likely?\nA easily accessible shop\nhigh quality product\nmore expensive\nB easily accessible shop\naverage quality product\nless expensive\nC shop owner known to customer\naverage quality product\nmore expensive\nD shop owner known to customer\npoor quality product\nless expensive\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: The price elasticity of demand for a good is calculated as \u20130.5.\n\nWhat will occur if the price of the good increases by 10 %?\nA Demand will fall by 20 %.\nB Demand will fall by 5 %.\nC Revenue will fall by 20 %.\nD Revenue will fall by 5 %.\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: Each of the four sets of descriptions applies to a different person who was appointed to a job.\n\nEach job was different.\n\nWhich job was likely to have offered the lowest pay?\nA skilled\ninexperienced\nolder worker\nB unskilled\nexperienced\nolder worker\nC skilled\nexperienced\nyounger worker\nD unskilled\ninexperienced\nyounger worker\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: What is most likely to explain why a worker receives above average hourly earnings?\nA Demand for the product is high and the production process is simple.\nB The employer provides the worker with fringe benefits.\nC The product is difficult to produce and requires the worker to be highly skilled.\nD Working in the job provides the worker with a high level of job satisfaction.\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: In which way will an increase in income be most likely to affect the amount of spending and\nsaving of an individual?\n\n\nspending\nsaving\nA fall\nfall\nB fall\nrise\nC rise\nfall\nD rise\nrise\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: Why might a person buy ordinary shares on the stock exchange rather than put the money in a\nsavings account?\nA to earn a fixed income\nB to gain a high return\nC to keep money in a safe place\nD to start a company\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: 25 % of both rural and urban consumers were reported to prefer products from Japan when\nbuying electronic goods.\n\nWhich combination of characteristics are the Japanese electronic goods likely to have which\npersuade consumers to make this choice?\n\n\ntechnology\nlength of guarantee\nrunning costs\nA latest\n12 months\nhigh\nB standard\n12 months\nlow\nC latest\n24 months\nlow\nD standard\n24 months\nhigh\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: The financial director of a company adds up the expenditure on items such as electricity, petrol\n(gas) and diesel fuel and raw materials. The director then divides that total by the firm\u2019s output.\n\nWhat has the director calculated?\nA average revenue\nB average fixed cost\nC average variable cost\nD average total cost\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: A business aims to maximise profits.\n\nTo do this, it will have to\nA maximise sales revenue.\nB maximise the difference between sales revenue and production costs.\nC minimise production costs.\nD minimise the difference between actual production and maximum production.\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: The following report appeared in a newspaper.\n\n\u2018British American Tobacco (BAT), the cigarette producer, said it would invest $1.5 million in\nChina during the next two years as it set up new factories. China is estimated to be the\nworld\u2019s most important market for the sale of cigarettes.\u2019\n\nWhat is likely to happen to the total cost, total revenue and profit of BAT?\n\n\ntotal cost\ntotal revenue\nprofit\nA decrease\nincrease\nuncertain\nB decrease\ndecrease\nincrease\nC increase\nincrease\nuncertain\nD increase\ndecrease\nincrease\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: Increasing returns to scale means that if all inputs are doubled, output will\nA remain the same.\nB increase but less than double.\nC double.\nD more than double.\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: A motor car manufacturer buys a chain of showrooms where the new cars are sold to the public.\n\nOf what is this an example?\nA conglomerate integration\nB horizontal integration\nC vertical integration backwards\nD vertical integration forwards\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: Which of the following is not included in public expenditure?\nA capital spending by public companies\nB expenditure by government departments\nC investment by nationalised industries\nD spending by local governments\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: What is most likely to improve the economic performance of a country in the long run?\nA a decrease in investment\nB a decrease in the school-leaving age\nC an increase in government spending on education\nD an increase in the rate of interest\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: Rose earns $12 000 per annum and pays $4000 per annum in income tax. Johann earns\n$20 000 per annum and pays $5000 per annum in income tax.\n\nWhat describes this system of income tax?\nA flat rate\nB progressive\nC proportional\nD regressive\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: A government could be successful in achieving one of its economic aims. However, this could\ncause a subsequent result which might be undesirable.\n\nWhich case would the government think undesirable?\n\n\nsuccessful aim\nsubsequent result\nA improved balance of payments\nfewer people out of work\nB faster economic growth\nhigher living standards\nC steadier prices\nlower trade deficit\nD reduced unemployment\nhigher rate of inflation\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: The government puts a $2.00 tax on each $8.00 DVD sold. As a result, the price of a DVD rises\nfrom $8.00 to $8.50.\n\nWhat can be concluded from this?\nA The demand for DVDs is price inelastic.\nB The government will receive only 25 % of its expected tax revenue.\nC The incidence of the tax will fall mainly on the producer.\nD The tax is progressive.\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: Which type of unemployment is likely to lead to the most serious regional problems in a country?\nA cyclical\nB frictional\nC residual\nD structural\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: The Gross Domestic Product (GDP) of Hong Kong rose more slowly than the rest of South East\nAsia between 1997 and 2002.\n\nWhat is the most likely reason?\nA a fall in competitiveness in Hong Kong\nB a fall in production costs in Hong Kong\nC an economic recession throughout South East Asia\nD a rise in productivity in Hong Kong\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: Which combination is most likely to be found in a developing country compared with a more\ndeveloped country?\n\n\npopulation growth rate\ndeath rate\nA higher\nhigher\nB higher\nlower\nC lower\nhigher\nD lower\nlower\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: Real Gross Domestic Product per head is often used as a measure of the change in average\nliving standards.\n\nWhat reduces its effectiveness in representing this change?\nA It omits increases in the cost of living.\nB It omits increases in the general price level.\nC It omits increases in the hours people work.\nD It omits increases in the size of the population.\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: What will be found in a typical developed country?\nA a dominant primary sector\nB a large percentage of employment in the informal (unofficial) sector\nC a population with a rising average age\nD labour intensive production methods in manufacturing industry\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: Which commercial activity will not destroy the natural environment?\nA intensive fishing in coastal waters using modern fishing boats\nB large-scale farming using chemical fertilisers\nC picking apples from trees using local labour\nD tree felling by timber companies in tropical forests\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: World-wide campaigns to reduce smoking will affect Malawi, which has relied on tobacco for its\nmain export earnings.\n\nWhat is likely to happen if Malawi is successful in replacing its earnings from tobacco by\ndeveloping its tourist trade?\nA The number of jobs required in the service sector will decrease.\nB The primary sector will become more significant in the economy.\nC There will be greater expenditure on new roads and infrastructure.\nD Visible earnings will increase while invisible earnings will decrease.\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: Which of the following increases specialisation?\nA A farmer decides to convert some of his farm buildings into holiday cottages for rent.\nB A government decides that a country should be more self-sufficient in food production.\nC A restaurant owner decides to have only vegetarian meals on his menu.\nD A taxi driver decides to train for an additional licence to drive a bus.\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nNolwazi lived in a rural area in Botswana and made baskets to sell to the tourists. The local\ngovernment gave her a loan to buy a car to take the baskets to the city market.\n\nWhich factor of production increased?\nA capital\nB enterprise\nC labour\nD land\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nWhat, according to the definition of opportunity cost, is sacrificed when a decision is taken?\nA an identical alternative\nB any possible alternative\nC the least valuable alternative\nD the next best alternative\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nA friend said his French grandmother kept switching off the lights but left the tap running. His\nNamibian relative left the lights on while shouting at him to turn off the water.\n\nWhich availability of resources and level of prices would make economic sense of these\nconsumer actions?\n\n\nin France\nin Namibia\nA adequate water supplies\nexpensive electricity\nB cheap electricity\nadequate water supplies\nC expensive electricity\nscarce water supplies\nD scarce water supplies\ncheap electricity\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nA government decides that an economy should make more use of the market.\n\nWhich policy might help to achieve this?\nA a decrease in controls on imported goods\nB an increase in government ownership of land\nC an increase in subsidies to industry\nD the fixing of minimum wage levels for workers\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nA large supermarket applied to build on land which was an area of natural beauty. The local\ngovernment allowed the building, even though the natural beauty of the area would be lost,\nbecause many jobs would be created and much needed income would be brought to the local\ncommunity.\n\nWhich economic ideas cannot be found in the above statement?\nA external cost and private enterprise\nB free market and the conservation of resources\nC opportunity cost and improved standards of living\nD public sector and external benefit\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nFor what would price elasticity of demand be used?\nA calculating current disposable income\nB calculating the rate of price inflation\nC estimating changes in a company\u2019s cost\nD identifying changes in consumer spending patterns\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nWhat is an external benefit when a charge is made for vehicles entering a city centre?\nA increased government revenue\nB increased traffic\nC reduced air pollution\nD reduced business activity\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: In August 2007 the Central Bank of Swaziland increased its interest rate from 9.5 % to 10 %.\n\nWhich effect would this be likely to have on producers and consumers?\n\n\nproducers\nconsumers\nA borrow less\nsave more\nB borrow less\nspend more\nC invest more\nsave more\nD invest more\nspend more\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: Why might a family increase the proportion of its income it spends on food?\nA Some of the children start work.\nB The government increases the benefits it pays to families.\nC The number of children in the family increases.\nD The second parent becomes employed.\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: In 2007 the average annual pay of a scientist in the UK was \u00a337 290. The average annual pay of\na laboratory technician was \u00a326 157.\n\nWhat could explain this difference in earnings?\nA Laboratory technicians have stronger bargaining power than scientists.\nB Laboratory technicians have to work more unsociable hours than scientists.\nC The period of training for scientists is longer than that for laboratory technicians.\nD The supply of scientists is high relative to demand for their services.\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: What distinguishes a multi-national company from other companies?\nA It has agents in other countries.\nB It produces in other countries.\nC It takes part in international trade.\nD It uses raw materials and components from more than one country.\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: Cadbury Schweppes, the confectionery business, is reported to want to reduce the number of its\noffices in an attempt to decrease its general and administrative costs.\n\nWhich type of cost does Cadbury Schweppes hope to decrease?\nA average variable cost\nB marginal cost\nC total fixed cost\nD total variable cost\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: Prices tend to be lower in a competitive industry than in a monopoly.\n\nWhy is this?\nA A monopoly has less influence on the market.\nB Competitive industry has more economies of scale.\nC New firms are free to enter the competitive industry.\nD Profits are lower in a monopoly.\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: India is experiencing rapid growth in air travel. The number and size of airlines is increasing every\nyear.\n\nWhich effect arising from this growth is an external economy of scale?\nA Banks are more prepared to lend to large airlines rather than small airlines.\nB Fuel suppliers charge less to airlines that buy in bulk.\nC Institutions are established to train flight crew.\nD Larger airlines operate aircraft which can carry more passengers.\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \n21\n23\n\nHow many units will the firm produce to maximise profits?\nA 5\nB 6\nC 7\nD 8\n\n\n18 Economic growth can be defined as\nA an increase in a country\u2019s exports.\nB an increase in a country\u2019s population.\nC an increase in the productive capacity of an economy.\nD a reduction in inflation.\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: A country has different rates of income tax depending on the level of income earned.\n\nThe highest rate of income tax is cut from 40 % to 38 %.\n\nFrom this statement it can be deduced that taxation will become\nA less indirect.\nB less progressive.\nC less regressive.\nD more difficult to evade.\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: The government pays a subsidy for each worker employed by a firm in an area of high\nunemployment.\n\nWhen would this policy be most successful in reducing unemployment?\nA when the firm is capital-intensive\nB when the firm is labour-intensive, requiring mainly unskilled labour\nC when the firm provides professional services\nD when the firm requires mainly specialist, skilled labour\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: In 2008 inflation was close to 100 000 % in Zimbabwe. In a bid to reduce this high rate, the\nZimbabwean Government imposed maximum prices on a range of products. This caused price\nrises amongst those goods sold unofficially or illegally.\n\nWhat could explain this?\nA The maximum prices increased demand whilst reducing supply.\nB The maximum prices reduced demand whilst increasing supply.\nC The maximum prices were set above the equilibrium price levels.\nD The maximum prices were set at the equilibrium price levels.\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: As a result of a decrease in the demand for coal, several coal mines were closed.\n\nWhat type of unemployment would this cause?\nA cyclical\nB frictional\nC seasonal\nD structural\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: Which factor is most likely to reduce the average age of a population in a developed country?\nA a lower birth rate\nB a lower death rate\nC emigration\nD immigration\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: What is most likely to be found in a typical developing country?\nA a good education sector\nB a small average family size\nC a small percentage of very old people\nD high spending on entertainment\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: The Chinese Government is concerned about two population problems \u2013 overpopulation and a\ngender imbalance, with males outnumbering females.\n\nIn 2007 it reduced the number of babies that foreigners are allowed to adopt; almost all of the\nbabies are girls.\n\nWhat effect might this have on the size of China\u2019s population and gender imbalance in the short\nrun?\n\n\nsize of population\ngender imbalance\nA increase\nincrease\nB increase\nreduce\nC reduce\nincrease\nD reduce\nreduce\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: What benefit is likely to result from the extension of specialisation within manufacturing?\nA For a consumer, there are more individually made goods available.\nB For a consumer, there could be a lower cost of living.\nC For an employee, job satisfaction will increase.\nD For an employee, the nature of work is more varied.\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: Which two items, as well as trade in goods and services, are included in the current account of\nthe balance of payments?\nA foreign reserves and international investment\nB government spending and international borrowing\nC incomes and current transfers\nD taxation and foreign aid\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: Drinks producers in India are resisting plans to remove tariffs on imported drinks. They claim that\na reduction in tariffs would destroy the emerging drinks industry with large-scale imports of cheap\ndrinks.\n\nWhich argument for protectionism are they putting forward?\nA the declining industry argument\nB the infant industry argument\nC the strategic industry argument\nD the sunset industry argument\n\n\nBLANK PAGE\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \n(a) Identify two reasons why the M-PESA phone account is preferred to conventional\nbanking.\n\n\n\n\n2]\n\n\n\n(b) Describe the functions of a commercial bank.\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n5]\n\n\nFor\nExaminer's\nUse\n\n(c) Explain how an improvement in financial services might help reduce poverty.\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n6]\nFor\nExaminer's\nUse\n\n(d) Discuss what differences there might be between the working conditions and type of\noccupation of a rural worker compared with those of a city worker.\n\n\n\n\n\n\n\n\n\n\n\n\n4]\n\n\nFor\nExaminer's\nUse\n\n(e) Suppose you were asked to investigate whether the movement of workers from a rural\narea to a city or to another country was a benefit. Discuss what you might need to find\nout in order to come to a conclusion.\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n8]\n\n\nTotal: 25]\n\n\nFor\nExaminer's\nUse\nThe extract \u2018Zambezi Hydro-Electric Power\u2019 will be needed for this question.\n\n\n\n Answer: (a) Identify two reasons why the M-PESA phone account is preferred to conventional" }, { "notes": "", "input": "", "output": "Question: \n(a) Explain what is meant by a private benefit.\n\n\n\n\n2]\n\n\n(b) Use examples from the extract to explain what is meant by an externality.\n\n\n\n\n\n\n\n\n\n\n\n\n4]\nFor\nExaminer's\nUse\n\n(c) What would you need to find out in order to determine whether the large HEP project,\nrather than alternative methods, is the best way of providing electricity?\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n9]\n\n\nTotal: 15]\n\n\n Answer: (a) Explain what is meant by a private benefit." }, { "notes": "", "input": "", "output": "Question: \nWhat makes choice an important element in the basic economic problem?\nA Increased demand leads to higher market prices.\nB Limited resources have many alternative uses.\nC Reaching a market equilibrium may take a long time.\nD Scarce economic resources are distributed equally.\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nWhat is a factor of production?\nA an advantage of producing on a large scale\nB a resource used to produce goods and services\nC a sub-section of a manufacturing process\nD a unit of output\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nA government is faced with the choice of spending on either education or healthcare.\n\nOf what is this an example?\nA conservation of resources\nB monetary policy\nC opportunity cost\nD substitution of factors\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nA farmer pays a landowner for the use of a field.\n\nWhat is the income to the landowner called?\nA interest\nB profit\nC rent\nD wages\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nWhich statement could explain a decrease in the demand for natural rubber?\nA Demand for car tyres has increased.\nB New techniques of producing substitutes for rubber have been introduced.\nC Productivity of rubber plantations has increased.\nD The area of land on which rubber is grown has increased.\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nA stock exchange is a market in which\nA a system of barter operates.\nB the interest rate is fixed.\nC the value of the exchange rate is determined.\nD shares are bought and sold.\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \u2018Savers suffer as inflation rises to 4.4 %.\u2019\n\nWhich function of money is most involved in this statement?\nA means of deferred payments\nB medium of exchange\nC store of value\nD unit of account\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: What is the most likely reason for a worker preferring to be employed by the government rather\nthan by a firm in the private sector?\nA more chance of a fast changing environment\nB more chance to work in a large organisation\nC more opportunity to gain from successful risk taking\nD more possibility of productivity bonuses\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \u2018There are actors who earn extremely high incomes.\u2019\n\nWhat best explains this?\nA Acting is a popular career.\nB Actors have regular employment.\nC Actors work short hours.\nD Some actors have a unique talent.\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: What might be a direct benefit to the individual worker of a specialised job?\nA Specialisation can enable the worker to become more skilled.\nB Specialisation enables a better quality product to be produced.\nC Specialisation enables the firm to introduce more machinery.\nD Specialisation makes better use of resources.\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: A milk processing company takes over a group of dairy farms before merging with a chain of\nsupermarkets.\n\nWhich types of integration have taken place?\nA diversification followed by horizontal\nB horizontal followed by vertical backward\nC vertical backward followed by vertical forward\nD vertical forward followed by diversification\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: What is usually an advantage of a small firm?\nA the ability to benefit from bulk buying arrangements\nB the ability to raise finance from a stock exchange\nC the ability to respond quickly to changes in consumer demand\nD the ability to run a national advertising campaign\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: In 2008, XL, the UK\u2019s third largest tour operator went out of business.\n\nWhat would have been the effect of this on the level of competition in the industry, the external\neconomies of scale experienced by the remaining firms and the level of business confidence in\nthe UK?\n\n\nlevel of competition\nexternal economies\nof scale\nUK business\nconfidence\nA increase\nincrease\nreduce\nB increase\nreduce\nincrease\nC reduce\nincrease\nincrease\nD reduce\nreduce\nreduce\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: In 2008, the world\u2019s largest metal mining company, BHP, increased its profits by 20 %.\n\nWhat could have helped that happen?\nA a decrease in economic growth in the UK and the US\nB an increase in demand from China\nC more competition from other companies\nD more difficult mining conditions\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: Direct taxes can be used to\nA place the burden of tax on sellers not buyers.\nB protect domestic industries from foreign competition.\nC raise revenue without affecting the number of hours employees work.\nD redistribute incomes from rich to poor.\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: Brazil is a highly taxed economy. Some Brazilian economists have suggested that if the\ngovernment were to cut tax rates, the government would actually receive more tax revenue.\n\nWhy may cutting taxes increase revenue?\nA It may encourage emigration.\nB It may increase the tax burden.\nC It may lead to a fall in investment.\nD It may reduce tax evasion.\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: What is most likely to be the responsibility of a central government?\nA the provision of immigration officials at an airport\nB the provision of security cameras in a shopping centre\nC the provision of security staff at a bank\nD the provision of ticket inspectors on a train\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: In September 2008, the Chinese government increased the sales tax on cars with large engines\nwhilst it reduced the sales tax on cars with small engines. Most cars in China with large engines\nare imported whilst most cars with small engines are home produced.\n\nWhich effects would the changes in sales tax be expected to have on China\u2019s trade surplus and\nthe demand for home produced cars?\n\n\ntrade surplus\ndemand for home\nproduced cars\nA increase\nincrease\nB increase\nreduce\nC reduce\nincrease\nD reduce\nreduce\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: In Germany\u2019s 2007 retail price index, transport received a higher weighting than clothing and\nfootwear.\n\nWhat does this difference indicate?\nA Households spent more on transport than on clothing and footwear.\nB The price of transport rose by more than the price of clothing and footwear.\nC Transport is more of a luxury good than clothing and footwear.\nD Wage rises in the transport industry were higher than wage rises in the clothing and footwear\nindustry.\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: How is the pattern of employment likely to change when a country becomes more developed?\nA from rural employment to urban employment\nB from skilled employment to primary employment\nC from technical employment to manual employment\nD from tertiary employment to secondary employment\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: In 2008, the US had a higher GDP per head than Iceland, but a lower Human Development Index\nranking than Iceland.\n\nWhat could explain this difference?\nA Average family size is higher in Iceland.\nB Life expectancy is higher in Iceland.\nC School enrolments are higher in the US.\nD The population of the US is larger.\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: What will be the likely effect on the remaining population of a developing country when newly\ntrained, skilled workers migrate to developed countries?\nA Its average age will increase.\nB Its mobility will increase.\nC Its productivity will increase.\nD Its total size will increase.\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: What is most likely to indicate that an economy is developed rather than developing?\nA a high birth rate and a low death rate\nB a large primary sector and a high population growth\nC a large service sector and capital intensive production\nD a low level of investment and a high rate of savings\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: One argument for protectionism is to prevent dumping.\n\nWhat is meant by dumping?\nA countries paying low wages to their workers to gain price advantage\nB countries providing poor working conditions for their employees to keep costs low\nC countries selling products abroad at less than the cost of production\nD countries selling products abroad that do not meet health and safety standards\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: What might cause the balance on the current account of Mauritius to improve?\nA increased purchases of coffee from Kenya\nB increased transport of Mauritian goods in Portuguese ships\nC increased spending by Mauritians on holidays in Goa\nD increased spending by tourists in Mauritian hotels\n\n\nBLANK PAGE\n\n\nBLANK PAGE\n\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nA farmer pays a landowner for the use of a field.\n\nWhat is the income to the landowner called?\nA interest\nB profit\nC rent\nD wages\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nWhat makes choice an important element in the basic economic problem?\nA Increased demand leads to higher market prices.\nB Limited resources have many alternative uses.\nC Reaching a market equilibrium may take a long time.\nD Scarce economic resources are distributed equally.\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nWhat is a factor of production?\nA an advantage of producing on a large scale\nB a resource used to produce goods and services\nC a sub-section of a manufacturing process\nD a unit of output\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nA government is faced with the choice of spending on either education or healthcare.\n\nOf what is this an example?\nA conservation of resources\nB monetary policy\nC opportunity cost\nD substitution of factors\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nWhich statement could explain a decrease in the demand for natural rubber?\nA Demand for car tyres has increased.\nB New techniques of producing substitutes for rubber have been introduced.\nC Productivity of rubber plantations has increased.\nD The area of land on which rubber is grown has increased.\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nWhat might be a direct benefit to the individual worker of a specialised job?\nA Specialisation can enable the worker to become more skilled.\nB Specialisation enables a better quality product to be produced.\nC Specialisation enables the firm to introduce more machinery.\nD Specialisation makes better use of resources.\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: A stock exchange is a market in which\nA a system of barter operates.\nB the interest rate is fixed.\nC the value of the exchange rate is determined.\nD shares are bought and sold.\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \u2018Savers suffer as inflation rises to 4.4 %.\u2019\n\nWhich function of money is most involved in this statement?\nA means of deferred payments\nB medium of exchange\nC store of value\nD unit of account\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: What is the most likely reason for a worker preferring to be employed by the government rather\nthan by a firm in the private sector?\nA more chance of a fast changing environment\nB more chance to work in a large organisation\nC more opportunity to gain from successful risk taking\nD more possibility of productivity bonuses\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \u2018There are actors who earn extremely high incomes.\u2019\n\nWhat best explains this?\nA Acting is a popular career.\nB Actors have regular employment.\nC Actors work short hours.\nD Some actors have a unique talent.\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: A milk processing company takes over a group of dairy farms before merging with a chain of\nsupermarkets.\n\nWhich types of integration have taken place?\nA diversification followed by horizontal\nB horizontal followed by vertical backward\nC vertical backward followed by vertical forward\nD vertical forward followed by diversification\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: What is usually an advantage of a small firm?\nA the ability to benefit from bulk buying arrangements\nB the ability to raise finance from a stock exchange\nC the ability to respond quickly to changes in consumer demand\nD the ability to run a national advertising campaign\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: In 2008, XL, the UK\u2019s third largest tour operator went out of business.\n\nWhat would have been the effect of this on the level of competition in the industry, the external\neconomies of scale experienced by the remaining firms and the level of business confidence in\nthe UK?\n\n\nlevel of competition\nexternal economies\nof scale\nUK business\nconfidence\nA increase\nincrease\nreduce\nB increase\nreduce\nincrease\nC reduce\nincrease\nincrease\nD reduce\nreduce\nreduce\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: In 2008, the world\u2019s largest metal mining company, BHP, increased its profits by 20 %.\n\nWhat could have helped that happen?\nA a decrease in economic growth in the UK and the US\nB an increase in demand from China\nC more competition from other companies\nD more difficult mining conditions\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: In September 2008, the Chinese government increased the sales tax on cars with large engines\nwhilst it reduced the sales tax on cars with small engines. Most cars in China with large engines\nare imported whilst most cars with small engines are home produced.\n\nWhich effects would the changes in sales tax be expected to have on China\u2019s trade surplus and\nthe demand for home produced cars?\n\n\ntrade surplus\ndemand for home\nproduced cars\nA increase\nincrease\nB increase\nreduce\nC reduce\nincrease\nD reduce\nreduce\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: Direct taxes can be used to\nA place the burden of tax on sellers not buyers.\nB protect domestic industries from foreign competition.\nC raise revenue without affecting the number of hours employees work.\nD redistribute incomes from rich to poor.\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: Brazil is a highly taxed economy. Some Brazilian economists have suggested that if the\ngovernment were to cut tax rates, the government would actually receive more tax revenue.\n\nWhy may cutting taxes increase revenue?\nA It may encourage emigration.\nB It may increase the tax burden.\nC It may lead to a fall in investment.\nD It may reduce tax evasion.\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: What is most likely to be the responsibility of a central government?\nA the provision of immigration officials at an airport\nB the provision of security cameras in a shopping centre\nC the provision of security staff at a bank\nD the provision of ticket inspectors on a train\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: In 2008, the US had a higher GDP per head than Iceland, but a lower Human Development Index\nranking than Iceland.\n\nWhat could explain this difference?\nA Average family size is higher in Iceland.\nB Life expectancy is higher in Iceland.\nC School enrolments are higher in the US.\nD The population of the US is larger.\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: In Germany\u2019s 2007 retail price index, transport received a higher weighting than clothing and\nfootwear.\n\nWhat does this difference indicate?\nA Households spent more on transport than on clothing and footwear.\nB The price of transport rose by more than the price of clothing and footwear.\nC Transport is more of a luxury good than clothing and footwear.\nD Wage rises in the transport industry were higher than wage rises in the clothing and footwear\nindustry.\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: How is the pattern of employment likely to change when a country becomes more developed?\nA from rural employment to urban employment\nB from skilled employment to primary employment\nC from technical employment to manual employment\nD from tertiary employment to secondary employment\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: What is most likely to indicate that an economy is developed rather than developing?\nA a high birth rate and a low death rate\nB a large primary sector and a high population growth\nC a large service sector and capital intensive production\nD a low level of investment and a high rate of savings\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: What will be the likely effect on the remaining population of a developing country when newly\ntrained, skilled workers migrate to developed countries?\nA Its average age will increase.\nB Its mobility will increase.\nC Its productivity will increase.\nD Its total size will increase.\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: What might cause the balance on the current account of Mauritius to improve?\nA increased purchases of coffee from Kenya\nB increased transport of Mauritian goods in Portuguese ships\nC increased spending by Mauritians on holidays in Goa\nD increased spending by tourists in Mauritian hotels\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: One argument for protectionism is to prevent dumping.\n\nWhat is meant by dumping?\nA countries paying low wages to their workers to gain price advantage\nB countries providing poor working conditions for their employees to keep costs low\nC countries selling products abroad at less than the cost of production\nD countries selling products abroad that do not meet health and safety standards\n\n\nBLANK PAGE\n\n\nBLANK PAGE\n\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nA government is faced with the choice of spending on either education or healthcare.\n\nOf what is this an example?\nA conservation of resources\nB monetary policy\nC opportunity cost\nD substitution of factors\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nA farmer pays a landowner for the use of a field.\n\nWhat is the income to the landowner called?\nA interest\nB profit\nC rent\nD wages\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nWhat makes choice an important element in the basic economic problem?\nA Increased demand leads to higher market prices.\nB Limited resources have many alternative uses.\nC Reaching a market equilibrium may take a long time.\nD Scarce economic resources are distributed equally.\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nWhat is a factor of production?\nA an advantage of producing on a large scale\nB a resource used to produce goods and services\nC a sub-section of a manufacturing process\nD a unit of output\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nWhich statement could explain a decrease in the demand for natural rubber?\nA Demand for car tyres has increased.\nB New techniques of producing substitutes for rubber have been introduced.\nC Productivity of rubber plantations has increased.\nD The area of land on which rubber is grown has increased.\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \n\u2018There are actors who earn extremely high incomes.\u2019\n\nWhat best explains this?\nA Acting is a popular career.\nB Actors have regular employment.\nC Actors work short hours.\nD Some actors have a unique talent.\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: What might be a direct benefit to the individual worker of a specialised job?\nA Specialisation can enable the worker to become more skilled.\nB Specialisation enables a better quality product to be produced.\nC Specialisation enables the firm to introduce more machinery.\nD Specialisation makes better use of resources.\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: A stock exchange is a market in which\nA a system of barter operates.\nB the interest rate is fixed.\nC the value of the exchange rate is determined.\nD shares are bought and sold.\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \u2018Savers suffer as inflation rises to 4.4 %.\u2019\n\nWhich function of money is most involved in this statement?\nA means of deferred payments\nB medium of exchange\nC store of value\nD unit of account\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: What is the most likely reason for a worker preferring to be employed by the government rather\nthan by a firm in the private sector?\nA more chance of a fast changing environment\nB more chance to work in a large organisation\nC more opportunity to gain from successful risk taking\nD more possibility of productivity bonuses\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: In 2008, the world\u2019s largest metal mining company, BHP, increased its profits by 20 %.\n\nWhat could have helped that happen?\nA a decrease in economic growth in the UK and the US\nB an increase in demand from China\nC more competition from other companies\nD more difficult mining conditions\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: A milk processing company takes over a group of dairy farms before merging with a chain of\nsupermarkets.\n\nWhich types of integration have taken place?\nA diversification followed by horizontal\nB horizontal followed by vertical backward\nC vertical backward followed by vertical forward\nD vertical forward followed by diversification\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: What is usually an advantage of a small firm?\nA the ability to benefit from bulk buying arrangements\nB the ability to raise finance from a stock exchange\nC the ability to respond quickly to changes in consumer demand\nD the ability to run a national advertising campaign\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: In 2008, XL, the UK\u2019s third largest tour operator went out of business.\n\nWhat would have been the effect of this on the level of competition in the industry, the external\neconomies of scale experienced by the remaining firms and the level of business confidence in\nthe UK?\n\n\nlevel of competition\nexternal economies\nof scale\nUK business\nconfidence\nA increase\nincrease\nreduce\nB increase\nreduce\nincrease\nC reduce\nincrease\nincrease\nD reduce\nreduce\nreduce\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: What is most likely to be the responsibility of a central government?\nA the provision of immigration officials at an airport\nB the provision of security cameras in a shopping centre\nC the provision of security staff at a bank\nD the provision of ticket inspectors on a train\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: In September 2008, the Chinese government increased the sales tax on cars with large engines\nwhilst it reduced the sales tax on cars with small engines. Most cars in China with large engines\nare imported whilst most cars with small engines are home produced.\n\nWhich effects would the changes in sales tax be expected to have on China\u2019s trade surplus and\nthe demand for home produced cars?\n\n\ntrade surplus\ndemand for home\nproduced cars\nA increase\nincrease\nB increase\nreduce\nC reduce\nincrease\nD reduce\nreduce\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: Direct taxes can be used to\nA place the burden of tax on sellers not buyers.\nB protect domestic industries from foreign competition.\nC raise revenue without affecting the number of hours employees work.\nD redistribute incomes from rich to poor.\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: Brazil is a highly taxed economy. Some Brazilian economists have suggested that if the\ngovernment were to cut tax rates, the government would actually receive more tax revenue.\n\nWhy may cutting taxes increase revenue?\nA It may encourage emigration.\nB It may increase the tax burden.\nC It may lead to a fall in investment.\nD It may reduce tax evasion.\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: How is the pattern of employment likely to change when a country becomes more developed?\nA from rural employment to urban employment\nB from skilled employment to primary employment\nC from technical employment to manual employment\nD from tertiary employment to secondary employment\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: In 2008, the US had a higher GDP per head than Iceland, but a lower Human Development Index\nranking than Iceland.\n\nWhat could explain this difference?\nA Average family size is higher in Iceland.\nB Life expectancy is higher in Iceland.\nC School enrolments are higher in the US.\nD The population of the US is larger.\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: In Germany\u2019s 2007 retail price index, transport received a higher weighting than clothing and\nfootwear.\n\nWhat does this difference indicate?\nA Households spent more on transport than on clothing and footwear.\nB The price of transport rose by more than the price of clothing and footwear.\nC Transport is more of a luxury good than clothing and footwear.\nD Wage rises in the transport industry were higher than wage rises in the clothing and footwear\nindustry.\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: What will be the likely effect on the remaining population of a developing country when newly\ntrained, skilled workers migrate to developed countries?\nA Its average age will increase.\nB Its mobility will increase.\nC Its productivity will increase.\nD Its total size will increase.\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: What is most likely to indicate that an economy is developed rather than developing?\nA a high birth rate and a low death rate\nB a large primary sector and a high population growth\nC a large service sector and capital intensive production\nD a low level of investment and a high rate of savings\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: 89.1\n1147.9\nC Nigeria\n292.7\n138.3\nD South Africa\n467.1\n43.8\n\n\n29 One argument for protectionism is to prevent dumping.\n\nWhat is meant by dumping?\nA countries paying low wages to their workers to gain price advantage\nB countries providing poor working conditions for their employees to keep costs low\nC countries selling products abroad at less than the cost of production\nD countries selling products abroad that do not meet health and safety standards\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: What might cause the balance on the current account of Mauritius to improve?\nA increased purchases of coffee from Kenya\nB increased transport of Mauritian goods in Portuguese ships\nC increased spending by Mauritians on holidays in Goa\nD increased spending by tourists in Mauritian hotels\n\n\nBLANK PAGE\n\n\nBLANK PAGE\n\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nEvery business organisation faces the problem of satisfying wants.\n\nWhat is the reason why wants are not fully satisfied?\nA An economy can only produce a limited amount of goods and services.\nB Governments cannot print enough money to pay for goods and services.\nC There is an over-production of goods and services by business organisations.\nD Workers are too skilled for the requirements of the jobs available.\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nA university rejects 2000 qualified applicants who wish to study there.\n\nWhat factor of production could have caused the university to make this decision?\nA infinite quantity of capital\nB scarcity of labour\nC surplus of land\nD unlimited supply of enterprise\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \n0 0\n20\n40\n60\n80\n100\n120\nearnings $\nhours of leisure\nper day\nX Y\n\n\nWhat is the opportunity cost to the individual of the extra earnings when moving from position X\nto position Y?\nA $20\nB $80\nC 4 hours of leisure per day\nD 8 hours of leisure per day\n\n\n4 How are economic decisions determined in a pure market system?\nA by a mixture of market forces and government regulation\nB by central planners of production and consumption\nC by government regulation of the price mechanism\nD by the forces of demand and supply\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nDrought in African countries often results in poor harvests. Other countries then help by sending\nquantities of food.\n\nWhat are the likely results of these events for the price of food in the drought-affected countries?\nA It will fall and then rise.\nB It will rise and continue to rise.\nC It will rise and remain at this higher level.\nD It will rise and then fall.\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nWhich person would wish to encourage the use of the market system?\nA someone who believes that people should have equal living standards\nB someone who believes that people should have freedom of action\nC someone who believes that profit maximisation is wrong\nD someone who believes that the government should correct peoples\u2019 bad behaviour\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nWhat is an example of an external cost?\nA a company\u2019s transport costs\nB the cost of bringing about a merger\nC the cost of buying components from suppliers\nD the cost of industrial pollution\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: Which motive is most likely to increase the wish to open a savings account?\nA to have cash immediately available\nB to prepare for future expenditure\nC to satisfy essential needs\nD to widen present consumption choices\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: Share prices on the stock market are most likely to rise if\nA employment falls.\nB interest rates fall.\nC interest rates rise.\nD tax rates rise.\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: The ways of making and receiving payments continue to develop. As well as cash, debit cards\nand credit cards, mobile (cell) phones are now being used to make payments.\n\nWhich method of paying for products provides no information to sellers about their customers?\nA cash\nB debit cards\nC credit cards\nD mobile (cell) phones\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: A group of workers in a firm join a trade union.\n\nWhat would the union be expected to do?\nA arrange for labour-saving technology to be introduced\nB discuss safety issues in the workplace with the employer\nC ensure job security by promoting the firm\u2019s products through advertising\nD negotiate new contracts with major buyers of the firm\u2019s products\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: In 2009, the Chinese Government tried to increase household spending.\n\nWhich policy measure would have been most likely to achieve this objective?\nA an increase in both direct and indirect taxes\nB a reduction in subsidies given to manufacturers\nC a requirement for commercial banks to reduce their lending\nD a switch from public to private sector provision of health care and pensions\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: General Motors, a large multi-national company based in the United States, sold some of its\nEuropean car assembly plants to other car manufacturers during the world recession (economic\ndownturn) in 2009.\n\nWhich economic reason would have been most likely to influence this decision?\nA to benefit from horizontal integration of manufacturing\nB to diversify and expand its product range\nC to encourage vertical integration of sales and production\nD to reduce its excess capacity in car production\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: A firm is producing an output which enables it to make more than normal profit.\n\nWhat must be true at that output?\nA Average revenue must be greater than total revenue.\nB Average revenue must equal average cost.\nC Total revenue must be greater than total cost.\nD Variable cost must equal price.\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: Which statement about total fixed cost is correct?\nA It falls as output increases.\nB It is calculated by adding total cost and total variable cost.\nC It is calculated by dividing total cost by output.\nD It must be paid even if output is zero.\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: Which type of business organisation has its shares quoted on a stock exchange?\nA co-operative\nB private company\nC public company\nD public corporation\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: What is a long-term advantage of economic growth?\nA employment falls\nB incomes rise\nC prices rise\nD savings fall\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: A tax on which of the following is usually progressive and is paid by a large number of tax\npayers?\nA company profits\nB goods and services\nC incomes\nD sales of shares\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: Which government policy would be likely to help local companies expand?\nA encouraging investment by foreign companies\nB increasing income tax\nC providing a subsidy\nD raising interest rates\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: Between December 2008 and August 2009, the Central Bank of South Africa cut the rate of\ninterest from 12.5 % to 7 %.\n\nWhat effect would this action be expected to have on economic growth and unemployment?\n\n\neconomic growth\nunemployment\nA decrease\ndecrease\nB decrease\nincrease\nC increase\ndecrease\nD increase\nincrease\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: There was a fall in investment spending by businesses in the third quarter of 2008.\n\nWhat would be the likely result of this?\nA an increase in economic growth\nB an increase in exports\nC an increase in incomes\nD an increase in unemployment\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: What is typical of a recession (economic downturn)?\nA falling Gross Domestic Product\nB falling unemployment\nC rising living standards\nD rising retail price index\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: What is most likely to happen if there is a fall in the death rate while the birth rate and migration\nremain unchanged?\nA The population structure will remain the same.\nB The population will increase.\nC There will be a change in the proportion of men to women.\nD The standard of living will increase.\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: Developing countries are sometimes given aid by charities and foreign governments.\n\nWhich aid programme would be least likely to lead to long-term economic growth?\nA the building of an irrigation system\nB the construction of a new airport\nC the distribution of gifts of food\nD the training of technical staff\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: Many sportsmen and sportswomen from developing countries go to the United States (US) to\nearn money, most of which they send back to their own countries.\n\nWhat impact would this have on the Balance of Payments?\nA The current account balance of the developing countries would improve.\nB The current account balance of the US would improve.\nC The trade balance of the developing countries would improve.\nD The trade balance of the US would improve.\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nEvery business organisation faces the problem of satisfying wants.\n\nWhat is the reason why wants are not fully satisfied?\nA An economy can only produce a limited amount of goods and services.\nB Governments cannot print enough money to pay for goods and services.\nC There is an over-production of goods and services by business organisations.\nD Workers are too skilled for the requirements of the jobs available.\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nA university rejects 2000 qualified applicants who wish to study there.\n\nWhat factor of production could have caused the university to make this decision?\nA infinite quantity of capital\nB scarcity of labour\nC surplus of land\nD unlimited supply of enterprise\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nWhat is an example of an external cost?\nA a company\u2019s transport costs\nB the cost of bringing about a merger\nC the cost of buying components from suppliers\nD the cost of industrial pollution\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nHow are economic decisions determined in a pure market system?\nA by a mixture of market forces and government regulation\nB by central planners of production and consumption\nC by government regulation of the price mechanism\nD by the forces of demand and supply\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nDrought in African countries often results in poor harvests. Other countries then help by sending\nquantities of food.\n\nWhat are the likely results of these events for the price of food in the drought-affected countries?\nA It will fall and then rise.\nB It will rise and continue to rise.\nC It will rise and remain at this higher level.\nD It will rise and then fall.\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nWhich person would wish to encourage the use of the market system?\nA someone who believes that people should have equal living standards\nB someone who believes that people should have freedom of action\nC someone who believes that profit maximisation is wrong\nD someone who believes that the government should correct peoples\u2019 bad behaviour\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: In 2009, the Chinese Government tried to increase household spending.\n\nWhich policy measure would have been most likely to achieve this objective?\nA an increase in both direct and indirect taxes\nB a reduction in subsidies given to manufacturers\nC a requirement for commercial banks to reduce their lending\nD a switch from public to private sector provision of health care and pensions\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: Which motive is most likely to increase the wish to open a savings account?\nA to have cash immediately available\nB to prepare for future expenditure\nC to satisfy essential needs\nD to widen present consumption choices\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: Share prices on the stock market are most likely to rise if\nA employment falls.\nB interest rates fall.\nC interest rates rise.\nD tax rates rise.\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: The ways of making and receiving payments continue to develop. As well as cash, debit cards\nand credit cards, mobile (cell) phones are now being used to make payments.\n\nWhich method of paying for products provides no information to sellers about their customers?\nA cash\nB debit cards\nC credit cards\nD mobile (cell) phones\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: A group of workers in a firm join a trade union.\n\nWhat would the union be expected to do?\nA arrange for labour-saving technology to be introduced\nB discuss safety issues in the workplace with the employer\nC ensure job security by promoting the firm\u2019s products through advertising\nD negotiate new contracts with major buyers of the firm\u2019s products\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: Which type of business organisation has its shares quoted on a stock exchange?\nA co-operative\nB private company\nC public company\nD public corporation\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: General Motors, a large multi-national company based in the United States, sold some of its\nEuropean car assembly plants to other car manufacturers during the world recession (economic\ndownturn) in 2009.\n\nWhich economic reason would have been most likely to influence this decision?\nA to benefit from horizontal integration of manufacturing\nB to diversify and expand its product range\nC to encourage vertical integration of sales and production\nD to reduce its excess capacity in car production\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: A firm is producing an output which enables it to make more than normal profit.\n\nWhat must be true at that output?\nA Average revenue must be greater than total revenue.\nB Average revenue must equal average cost.\nC Total revenue must be greater than total cost.\nD Variable cost must equal price.\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: Which statement about total fixed cost is correct?\nA It falls as output increases.\nB It is calculated by adding total cost and total variable cost.\nC It is calculated by dividing total cost by output.\nD It must be paid even if output is zero.\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: Between December 2008 and August 2009, the Central Bank of South Africa cut the rate of\ninterest from 12.5 % to 7 %.\n\nWhat effect would this action be expected to have on economic growth and unemployment?\n\n\neconomic growth\nunemployment\nA decrease\ndecrease\nB decrease\nincrease\nC increase\ndecrease\nD increase\nincrease\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: Which government policy would be likely to help local companies expand?\nA encouraging investment by foreign companies\nB increasing income tax\nC providing a subsidy\nD raising interest rates\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: A tax on which of the following is usually progressive and is paid by a large number of tax\npayers?\nA company profits\nB goods and services\nC incomes\nD sales of shares\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: What is a long-term advantage of economic growth?\nA employment falls\nB incomes rise\nC prices rise\nD savings fall\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: What is typical of a recession (economic downturn)?\nA falling Gross Domestic Product\nB falling unemployment\nC rising living standards\nD rising retail price index\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: There was a fall in investment spending by businesses in the third quarter of 2008.\n\nWhat would be the likely result of this?\nA an increase in economic growth\nB an increase in exports\nC an increase in incomes\nD an increase in unemployment\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: Many sportsmen and sportswomen from developing countries go to the United States (US) to\nearn money, most of which they send back to their own countries.\n\nWhat impact would this have on the Balance of Payments?\nA The current account balance of the developing countries would improve.\nB The current account balance of the US would improve.\nC The trade balance of the developing countries would improve.\nD The trade balance of the US would improve.\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: 0\n43\nD Mozambique\n45\n80\n39\n\n\n29 Developing countries are sometimes given aid by charities and foreign governments.\n\nWhich aid programme would be least likely to lead to long-term economic growth?\nA the building of an irrigation system\nB the construction of a new airport\nC the distribution of gifts of food\nD the training of technical staff\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: What is most likely to happen if there is a fall in the death rate while the birth rate and migration\nremain unchanged?\nA The population structure will remain the same.\nB The population will increase.\nC There will be a change in the proportion of men to women.\nD The standard of living will increase.\n\n\nBLANK PAGE\n\nBLANK PAGE\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nA university rejects 2000 qualified applicants who wish to study there.\n\nWhat factor of production could have caused the university to make this decision?\nA infinite quantity of capital\nB scarcity of labour\nC surplus of land\nD unlimited supply of enterprise\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nEvery business organisation faces the problem of satisfying wants.\n\nWhat is the reason why wants are not fully satisfied?\nA An economy can only produce a limited amount of goods and services.\nB Governments cannot print enough money to pay for goods and services.\nC There is an over-production of goods and services by business organisations.\nD Workers are too skilled for the requirements of the jobs available.\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nWhich person would wish to encourage the use of the market system?\nA someone who believes that people should have equal living standards\nB someone who believes that people should have freedom of action\nC someone who believes that profit maximisation is wrong\nD someone who believes that the government should correct peoples\u2019 bad behaviour\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nWhat is an example of an external cost?\nA a company\u2019s transport costs\nB the cost of bringing about a merger\nC the cost of buying components from suppliers\nD the cost of industrial pollution\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nHow are economic decisions determined in a pure market system?\nA by a mixture of market forces and government regulation\nB by central planners of production and consumption\nC by government regulation of the price mechanism\nD by the forces of demand and supply\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nDrought in African countries often results in poor harvests. Other countries then help by sending\nquantities of food.\n\nWhat are the likely results of these events for the price of food in the drought-affected countries?\nA It will fall and then rise.\nB It will rise and continue to rise.\nC It will rise and remain at this higher level.\nD It will rise and then fall.\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nA D\n0 Q1\nquantity\nprice\n$ 10\nB D\n0 Q1\nquantity\nprice\n$ 10\nD D\n0 Q1\nquantity\nprice\n$ 10\nC D\n0 Q1\n\n\n\n10 A group of workers in a firm join a trade union.\n\nWhat would the union be expected to do?\nA arrange for labour-saving technology to be introduced\nB discuss safety issues in the workplace with the employer\nC ensure job security by promoting the firm\u2019s products through advertising\nD negotiate new contracts with major buyers of the firm\u2019s products\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: In 2009, the Chinese Government tried to increase household spending.\n\nWhich policy measure would have been most likely to achieve this objective?\nA an increase in both direct and indirect taxes\nB a reduction in subsidies given to manufacturers\nC a requirement for commercial banks to reduce their lending\nD a switch from public to private sector provision of health care and pensions\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: Which motive is most likely to increase the wish to open a savings account?\nA to have cash immediately available\nB to prepare for future expenditure\nC to satisfy essential needs\nD to widen present consumption choices\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: Share prices on the stock market are most likely to rise if\nA employment falls.\nB interest rates fall.\nC interest rates rise.\nD tax rates rise.\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: The ways of making and receiving payments continue to develop. As well as cash, debit cards\nand credit cards, mobile (cell) phones are now being used to make payments.\n\nWhich method of paying for products provides no information to sellers about their customers?\nA cash\nB debit cards\nC credit cards\nD mobile (cell) phones\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: Which statement about total fixed cost is correct?\nA It falls as output increases.\nB It is calculated by adding total cost and total variable cost.\nC It is calculated by dividing total cost by output.\nD It must be paid even if output is zero.\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: Which type of business organisation has its shares quoted on a stock exchange?\nA co-operative\nB private company\nC public company\nD public corporation\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: General Motors, a large multi-national company based in the United States, sold some of its\nEuropean car assembly plants to other car manufacturers during the world recession (economic\ndownturn) in 2009.\n\nWhich economic reason would have been most likely to influence this decision?\nA to benefit from horizontal integration of manufacturing\nB to diversify and expand its product range\nC to encourage vertical integration of sales and production\nD to reduce its excess capacity in car production\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: A firm is producing an output which enables it to make more than normal profit.\n\nWhat must be true at that output?\nA Average revenue must be greater than total revenue.\nB Average revenue must equal average cost.\nC Total revenue must be greater than total cost.\nD Variable cost must equal price.\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: Which government policy would be likely to help local companies expand?\nA encouraging investment by foreign companies\nB increasing income tax\nC providing a subsidy\nD raising interest rates\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: Between December 2008 and August 2009, the Central Bank of South Africa cut the rate of\ninterest from 12.5 % to 7 %.\n\nWhat effect would this action be expected to have on economic growth and unemployment?\n\n\neconomic growth\nunemployment\nA decrease\ndecrease\nB decrease\nincrease\nC increase\ndecrease\nD increase\nincrease\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: A tax on which of the following is usually progressive and is paid by a large number of tax\npayers?\nA company profits\nB goods and services\nC incomes\nD sales of shares\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: There was a fall in investment spending by businesses in the third quarter of 2008.\n\nWhat would be the likely result of this?\nA an increase in economic growth\nB an increase in exports\nC an increase in incomes\nD an increase in unemployment\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: What is typical of a recession (economic downturn)?\nA falling Gross Domestic Product\nB falling unemployment\nC rising living standards\nD rising retail price index\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: What is a long-term advantage of economic growth?\nA employment falls\nB incomes rise\nC prices rise\nD savings fall\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: Many sportsmen and sportswomen from developing countries go to the United States (US) to\nearn money, most of which they send back to their own countries.\n\nWhat impact would this have on the Balance of Payments?\nA The current account balance of the developing countries would improve.\nB The current account balance of the US would improve.\nC The trade balance of the developing countries would improve.\nD The trade balance of the US would improve.\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: What is most likely to happen if there is a fall in the death rate while the birth rate and migration\nremain unchanged?\nA The population structure will remain the same.\nB The population will increase.\nC There will be a change in the proportion of men to women.\nD The standard of living will increase.\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: Developing countries are sometimes given aid by charities and foreign governments.\n\nWhich aid programme would be least likely to lead to long-term economic growth?\nA the building of an irrigation system\nB the construction of a new airport\nC the distribution of gifts of food\nD the training of technical staff\n\n\nBLANK PAGE\n\nBLANK PAGE\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nOn average, doctors earn more than bus drivers.\n\nWhich change would be likely to reduce the earnings gap between doctors and bus drivers?\nA a decrease in the profits earned by bus companies\nB a decrease in the qualifications needed to be a doctor\nC an increase in demand for medical care\nD an increase in the number of people passing the driving test\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nWhat could reduce the ability of a trade union to gain a pay rise for its members in a shoe\nfactory?\nA an increase in sales of shoe exports\nB a rise in the demand for shoes\nC a rise in the productivity of shoe workers\nD more people willing to work in the shoe industry\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nWhat might encourage a consumer to save rather than to spend?\nA being made unemployed\nB discounts on products\nC government subsidies to producers\nD high interest rates\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nWhy do banknotes function as money?\nA They are backed by gold.\nB They are durable.\nC They are generally acceptable.\nD They have intrinsic value.\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nWhich is an external economy of scale?\nA availability of training facilities in local colleges\nB greater production from employees\nC increased credit facilities from banks\nD lower costs through bulk buying\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nWhat is a variable cost to a firm producing bicycles?\nA the component parts of the bicycles\nB the interest on money borrowed\nC the rent of the bicycle factory\nD the salaries of the senior managers\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nPartnerships in the United States of America (US) can now issue tradable shares and can limit\nthe amount of money that shareholders may lose.\n\nTo which type of business organisation do these changes make US partnerships similar?\nA co-operatives\nB public corporations\nC public limited companies\nD sole traders\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: What is a possible advantage to the consumer of a monopoly supplier in a market?\nA It achieves average costs which are lower than if there were many suppliers.\nB It achieves profits which are higher than if there were many suppliers.\nC It conducts advertising campaigns to discourage competition.\nD It decides which retail outlets may sell and distribute its goods.\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: In China the government is concerned about the level of poverty and the need for more resources\nin the poorer regions of the country. As a result, it is increasing its expenditure there and reducing\nit in the wealthier regions.\n\nWhich economic concept does this government policy illustrate best?\nA diseconomies of scale\nB market forces\nC opportunity cost\nD specialisation\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: A country with a low income per head discovers large quantities of oil, which eventually makes\neverybody better off.\n\nWhy is the basic economic problem of scarcity not solved by this discovery?\nA People may not get jobs in the oil industry.\nB People\u2019s wants are always changing and increasing.\nC Prices of oil can fluctuate on the world market.\nD Production of oil can damage the environment.\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: Two telecommunications companies are to merge to finance investments in new technology,\nwhich will be more efficient and require smaller buildings. Three hundred workers will lose their\njobs.\n\nWhat will happen to the factors of production used?\n\n\nland\nlabour\ncapital\nenterprise\nA fall\nfall\nrise\nfall\nB fall\nfall\nuncertain\nrise\nC rise\nrise\nrise\nrise\nD uncertain\nrise\nfall\nfall\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: Why might a free market economy be more advantageous than a mixed economy?\nA Equality of income is encouraged.\nB In a mixed economy, governments use taxes which are inefficient.\nC Production is determined solely by consumer wishes.\nD Social costs are taken into consideration.\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: An international company drilled for oil in deep water and caused a major oil leakage, which\naffected the jobs of the fishing community. The government ordered the company to close the\nwell and to stop drilling in the area.\n\nWhat are the external costs of this incident?\nA the costs borne by the fishing community\nB the costs of closing the well\nC the costs to the company of drilling the well in deep water\nD the loss of revenue when the oil company stopped drilling\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: Which is a type of market failure?\nA a general increase in the price of hotel rooms in busy summer seasons\nB an increase in house prices caused by easier borrowing for house buyers\nC an increase in travel time caused by a road accident\nD an increase in unsold goods because of a change in tastes\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: An Economics student described a typical developing country as having a large population, a low\nGDP per head, a relatively large primary sector and an uneven income distribution.\n\nWhich of these features is not necessarily accurate?\nA a large population\nB a low GDP per head\n\nC an uneven income distribution\nD a relatively large primary sector\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: In the developing economies of southern Africa, both infant mortality and life expectancy have\nfallen. Life expectancy now averages only 41 years.\n\nWhat is the result of these changes?\nA Current labour supply has fallen.\nB Fewer primary schools are needed.\nC Governments will pay for more retirement pensions.\nD Less will need to be spent on health care.\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: A government agreed to provide $20 million to a developing country to help supply emergency\naid.\n\nIn which part of the current account of the balance of payments was this payment recorded?\nA current transfer flows\nB income flows\nC trade in goods\nD trade in services\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: In some Asian countries the cost of labour is lower than in developed countries. As a result they\nmanufacture and export clothes to Europe, where the demand for clothes is high.\n\nThe quality of these clothes, however, is not as good as some of the clothes produced in Europe.\n\nWhat is likely to happen in the Asian countries and to the total expenditure on clothes in Europe?\n\n\nimpact in Asian countries\nchange in\nexpenditure in\nEurope\nA capital account will improve\nincrease\nB current account will improve\nuncertain\nC exchange rate will fall\nuncertain\nD terms of trade will fall\ndecrease\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: Which government policy would best protect the environment?\nA encouraging economic growth\nB exploiting natural resources\nC increasing tax on fuel\nD removing controls on industry\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: A government wishes to stimulate economic recovery.\n\nWhich action will assist this?\nA decreasing government investment\nB decreasing income tax\nC increasing indirect taxation\nD increasing interest rates\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: A country has a proportional system of taxation.\n\nA person pays $500 tax when earnings are $5000.\n\nHow much tax will be paid if earnings rise to $12 000?\nA $120\nB $500\nC $1200\nD $7500\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: Each year, extra cleaning staff were employed by a hotel on a temporary basis during the busy\nholiday period. They were not employed when the hotel was not busy.\n\nWhat type of unemployment occurred when the hotel was not busy?\nA cyclical\nB frictional\nC seasonal\nD technological\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: In the measurement of the UK\u2019s Retail Prices Index, a greater weight was given to bottled water\nin 2010 than 2009.\n\nWhat does this change indicate?\nA Government statisticians checked the price change of a greater range of bottled water in\n2010 than in 2009.\nB People spent a higher proportion of their total spending on bottled water in 2010 than in\n2009.\nC The price of bottled water increased more in 2010 than in 2009.\nD There was an improvement in the quality of bottled water in 2010 compared with 2009.\nBLANK PAGE\nBLANK PAGE\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nIn China the government is concerned about the level of poverty and the need for more resources\nin the poorer regions of the country. As a result, it is increasing its expenditure there and reducing\nit in the wealthier regions.\n\nWhich economic concept does this government policy illustrate best?\nA diseconomies of scale\nB market forces\nC opportunity cost\nD specialisation\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nA country with a low income per head discovers large quantities of oil, which eventually makes\neverybody better off.\n\nWhy is the basic economic problem of scarcity not solved by this discovery?\nA People may not get jobs in the oil industry.\nB People\u2019s wants are always changing and increasing.\nC Prices of oil can fluctuate on the world market.\nD Production of oil can damage the environment.\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nTwo telecommunications companies are to merge to finance investments in new technology,\nwhich will be more efficient and require smaller buildings. Three hundred workers will lose their\njobs.\n\nWhat will happen to the factors of production used?\n\n\nland\nlabour\ncapital\nenterprise\nA fall\nfall\nrise\nfall\nB fall\nfall\nuncertain\nrise\nC rise\nrise\nrise\nrise\nD uncertain\nrise\nfall\nfall\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nWhy might a free market economy be more advantageous than a mixed economy?\nA Equality of income is encouraged.\nB In a mixed economy, governments use taxes which are inefficient.\nC Production is determined solely by consumer wishes.\nD Social costs are taken into consideration.\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nAn international company drilled for oil in deep water and caused a major oil leakage, which\naffected the jobs of the fishing community. The government ordered the company to close the\nwell and to stop drilling in the area.\n\nWhat are the external costs of this incident?\nA the costs borne by the fishing community\nB the costs of closing the well\nC the costs to the company of drilling the well in deep water\nD the loss of revenue when the oil company stopped drilling\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nWhich is a type of market failure?\nA a general increase in the price of hotel rooms in busy summer seasons\nB an increase in house prices caused by easier borrowing for house buyers\nC an increase in travel time caused by a road accident\nD an increase in unsold goods because of a change in tastes\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: On average, doctors earn more than bus drivers.\n\nWhich change would be likely to reduce the earnings gap between doctors and bus drivers?\nA a decrease in the profits earned by bus companies\nB a decrease in the qualifications needed to be a doctor\nC an increase in demand for medical care\nD an increase in the number of people passing the driving test\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: What could reduce the ability of a trade union to gain a pay rise for its members in a shoe\nfactory?\nA an increase in sales of shoe exports\nB a rise in the demand for shoes\nC a rise in the productivity of shoe workers\nD more people willing to work in the shoe industry\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: What might encourage a consumer to save rather than to spend?\nA being made unemployed\nB discounts on products\nC government subsidies to producers\nD high interest rates\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: Why do banknotes function as money?\nA They are backed by gold.\nB They are durable.\nC They are generally acceptable.\nD They have intrinsic value.\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \u2013 29\n30 \u2013 39\n40 \u2013 49\n50 \u2013 62\n63+\n% of income saved\n\u201334 %\n\u2013 4 %\n18 %\n29 %\n\u201323 %\n\nWhat can be concluded from this data?\nA The 50 \u2013 62 age group has the highest level of income.\nB The 50 \u2013 62 age group saves the highest proportion of its income.\nC The older age groups earn more than the younger age groups.\nD The youngest age group spends more than the oldest age group.\n\n\n15 Which is an external economy of scale?\nA availability of training facilities in local colleges\nB greater production from employees\nC increased credit facilities from banks\nD lower costs through bulk buying\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: What is a variable cost to a firm producing bicycles?\nA the component parts of the bicycles\nB the interest on money borrowed\nC the rent of the bicycle factory\nD the salaries of the senior managers\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: Partnerships in the United States of America (US) can now issue tradable shares and can limit\nthe amount of money that shareholders may lose.\n\nTo which type of business organisation do these changes make US partnerships similar?\nA co-operatives\nB public corporations\nC public limited companies\nD sole traders\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: What is a possible advantage to the consumer of a monopoly supplier in a market?\nA It achieves average costs which are lower than if there were many suppliers.\nB It achieves profits which are higher than if there were many suppliers.\nC It conducts advertising campaigns to discourage competition.\nD It decides which retail outlets may sell and distribute its goods.\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: Which government policy would best protect the environment?\nA encouraging economic growth\nB exploiting natural resources\nC increasing tax on fuel\nD removing controls on industry\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: A government wishes to stimulate economic recovery.\n\nWhich action will assist this?\nA decreasing government investment\nB decreasing income tax\nC increasing indirect taxation\nD increasing interest rates\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: A country has a proportional system of taxation.\n\nA person pays $500 tax when earnings are $5000.\n\nHow much tax will be paid if earnings rise to $12 000?\nA $120\nB $500\nC $1200\nD $7500\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: Each year, extra cleaning staff were employed by a hotel on a temporary basis during the busy\nholiday period. They were not employed when the hotel was not busy.\n\nWhat type of unemployment occurred when the hotel was not busy?\nA cyclical\nB frictional\nC seasonal\nD technological\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: In the measurement of the UK\u2019s Retail Prices Index, a greater weight was given to bottled water\nin 2010 than 2009.\n\nWhat does this change indicate?\nA Government statisticians checked the price change of a greater range of bottled water in\n2010 than in 2009.\nB People spent a higher proportion of their total spending on bottled water in 2010 than in\n2009.\nC The price of bottled water increased more in 2010 than in 2009.\nD There was an improvement in the quality of bottled water in 2010 compared with 2009.\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: An Economics student described a typical developing country as having a large population, a low\nGDP per head, a relatively large primary sector and an uneven income distribution.\n\nWhich of these features is not necessarily accurate?\nA a large population\nB a low GDP per head\n\nC an uneven income distribution\nD a relatively large primary sector\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: In the developing economies of southern Africa, both infant mortality and life expectancy have\nfallen. Life expectancy now averages only 41 years.\n\nWhat is the result of these changes?\nA Current labour supply has fallen.\nB Fewer primary schools are needed.\nC Governments will pay for more retirement pensions.\nD Less will need to be spent on health care.\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: A government agreed to provide $20 million to a developing country to help supply emergency\naid.\n\nIn which part of the current account of the balance of payments was this payment recorded?\nA current transfer flows\nB income flows\nC trade in goods\nD trade in services\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: In some Asian countries the cost of labour is lower than in developed countries. As a result they\nmanufacture and export clothes to Europe, where the demand for clothes is high.\n\nThe quality of these clothes, however, is not as good as some of the clothes produced in Europe.\n\nWhat is likely to happen in the Asian countries and to the total expenditure on clothes in Europe?\n\n\nimpact in Asian countries\nchange in\nexpenditure in\nEurope\nA capital account will improve\nincrease\nB current account will improve\nuncertain\nC exchange rate will fall\nuncertain\nD terms of trade will fall\ndecrease\n\n\nBLANK PAGE\n\n\nBLANK PAGE\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nIn China the government is concerned about the level of poverty and the need for more resources\nin the poorer regions of the country. As a result, it is increasing its expenditure there and reducing\nit in the wealthier regions.\n\nWhich economic concept does this government policy illustrate best?\nA diseconomies of scale\nB market forces\nC opportunity cost\nD specialisation\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nAs the need for energy increases, energy suppliers use a mix of resources.\n\nWhich resource is renewable?\nA coal\nB gas\nC oil\nD water\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nA public limited company delivers groceries which customers order on the Internet.\n\nWhat is an example for the firm of the factor of production called capital?\nA the computers required to receive the orders\nB the fuel used by the delivery vehicles\nC the money required to pay the firm\u2019s costs\nD the shares it sells on the stock exchange\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nWhat is likely to play a more important role in a mixed economy than in a free market economy?\nA consumer wishes\nB government intervention\nC international trade\nD the profit motive\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nWhat necessarily happens when an external benefit exists?\nA Social benefit is greater than private benefit.\nB Social benefit is greater than social cost.\nC Social cost is equal to private cost.\nD Social cost is greater than private cost.\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nA developer built some large houses in a rural area which poorer people could not afford. The\nhouses destroyed an area of natural beauty.\n\nWhat type of market failure resulted from the development?\nA inequality of income\nB lack of information\nC negative externality\nD price discrimination\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: What work is in the primary sector?\nA delivering milk\nB designing gardens\nC growing fruit trees\nD selling agricultural fertiliser\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: What are the actions of a trade union intended to achieve in the long run?\nA benefits to society\nB harm to employers\nC help for members\nD reduced company profits\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: An individual has various financial assets.\n\nWhat is the most easily available as cash?\nA a current (checking) bank account\nB government bonds\nC share certificates in a public company\nD time deposits in a savings bank\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: Why do banknotes function as money?\nA They are backed by gold.\nB They are durable.\nC They are generally acceptable.\nD They have intrinsic value.\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \u2013 29\n30 \u2013 39\n40 \u2013 49\n50 \u2013 62\n63+\n% of income saved\n\u201334 %\n\u2013 4 %\n18 %\n29 %\n\u201323 %\n\nWhat can be concluded from this data?\nA The 50 \u2013 62 age group has the highest level of income.\nB The 50 \u2013 62 age group saves the highest proportion of its income.\nC The older age groups earn more than the younger age groups.\nD The youngest age group spends more than the oldest age group.\n\n\n15 A firm opens new branches in four different cities. As a result, it can negotiate a better deal from\nits foreign suppliers because it purchases larger quantities. However, it finds the distance\nbetween branches causes organisational problems.\n\nWhat describes the result for the firm?\nA an external economy of scale and an external diseconomy of scale\nB an external economy of scale and an internal diseconomy of scale\nC an internal economy of scale and an external diseconomy of scale\nD an internal economy of scale and an internal diseconomy of scale\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: As a firm increases its weekly output from 10 units to 20 units, its average cost falls from $15 to\n$10.\n\nWhich of its costs have risen?\nA fixed costs and variable costs only\nB fixed costs, variable costs and total costs\nC total costs only\nD variable costs and total costs only\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: A group of hotels, owned and operated in France, needs its staff to be able to speak a number of\nlanguages so it employs people from different countries. Different firms, providing tours from\nother countries, send customers to the hotels in France. The hotel group has shares issued on\nthe stock exchange.\n\n\nWhat type of company is the hotel group?\nA a multi-national\nB a partnership\nC a private company\nD a public company\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: Machu Picchu is Peru\u2019s most popular tourist destination. One train company, PeruRail, operates\na monopoly service up to the site.\n\nWhy might competition on the route increase the fares paid by passengers?\nA Competitive firms have more influence on price than a monopoly.\nB Competitive firms never make a loss.\nC Less advantage may be taken of economics of scale.\nD More profit may be available to spend on new technology to reduce costs of production.\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: Which government policy would best protect the environment?\nA encouraging economic growth\nB exploiting natural resources\nC increasing tax on fuel\nD removing controls on industry\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: Russia exports wheat. In 2010, because of a bad harvest, the Russian Government prevented\nthe export of wheat to keep enough supplies for domestic use.\n\nWhat happened as a result of the government\u2019s action?\nA Prices were fixed by the wheat producers.\nB The amount produced was determined by the government.\nC The price of wheat abroad fell.\nD There was a redistribution of domestic production.\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: A country has a proportional system of taxation.\n\nA person pays $500 tax when earnings are $5000.\n\nHow much tax will be paid if earnings rise to $12 000?\nA $120\nB $500\nC $1200\nD $7500\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: An increase in online banking by customers using home computers has reduced the level of\nemployment in the banking sector of developed countries.\n\nWhat describes this kind of unemployment?\nA frictional\nB regional\nC seasonal\nD technological\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: China has become South Africa\u2019s largest trading partner. In 2009, 16 % of South Africa\u2019s imports\ncame from China while 11 % of its exports went to China.\n\nChina is also investing in infrastructure designed to help increase production in South Africa.\n\nWhat can be concluded from this information?\nA China is investing more in South Africa than in other countries.\nB China\u2019s GDP will grow more slowly than South Africa\u2019s GDP.\nC GDP in South Africa is likely to rise.\nD South Africa imported a greater number of goods and services from China than it exported to\nChina.\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: What is usually true of workers approaching retirement when they are compared with new\nentrants to the workforce?\n\nA They will be more adaptable.\nB They will be more experienced.\nC They will be more mobile.\nD They will be physically stronger.\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: In 2010, Nigeria had a birth rate of 36 and an infant mortality rate of 94.\n\nWhat can be concluded from this information?\nA Nigeria experienced a natural decrease in population.\nB Nigeria\u2019s population increased.\nC 36 children were born per hundred of the population.\nD 94 babies died before their first birthday out of every thousand babies born.\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: A Japanese car manufacturer decided to produce its cars in a factory in Europe.\n\nWhat would not be a reason why they might have chosen to do this?\nA cheaper wage costs in Europe\nB the availability of raw materials\nC to gain external economies from skilled labour in Europe\nD to increase Japanese self-sufficiency\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: A country imports oil, which has risen in price and which is used for production and for\ndistribution. There has also been an increase in unemployment in the country. Businesses have\nclosed and total consumer demand has fallen.\n\nWhat is likely to happen to the balance of trade and economic growth?\n\n\nbalance of trade\neconomic growth\nA improve\nlikely to increase\nB uncertain\nlikely to decrease\nC worsen\nlikely to decrease\nD worsen\nlikely to increase\n\n\nBLANK PAGE\n\n\nBLANK PAGE\n\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nWhat is a reason why firms making similar products sometimes locate near each other?\nA competition is decreased\nB there are external economies of scale\nC there are internal economies of scale\nD transport costs may be eliminated\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nTo achieve horizontal integration a record company producing compact discs (CDs) could merge\nwith another firm.\n\nWhat would this firm most likely be doing?\nA owning shops selling CDs\nB producing CDs\nC producing CD players\nD producing machinery used in the making of CDs\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nWhat is a difference between a monopoly and a perfectly competitive firm?\nA A monopoly always has economies of scale and a perfectly competitive firm has\ndiseconomies of scale.\nB A monopoly always operates in the public sector and a perfectly competitive firm always\noperates in the private sector.\nC A monopoly is a price maker and a perfectly competitive firm is a price taker.\nD A monopoly seeks to maximise profits and a perfectly competitive firm seeks to maximise\noutput.\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nAn entrepreneur started a small business making candles. In the first month 1000 candles were\nmade. The costs were\n\n$ raw materials\n1000\npackaging\n800\ninsurance\n100\ndepreciation\n100\nrent\n500\n\n\nWhat were the average variable costs for the month?\nA $1.00\nB $1.80\nC $1.90\nD $2.00\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nWhich aim of government policy is most likely to be achieved by an increase in interest rates?\nA economic growth\nB greater equality of income\nC full employment\nD price stability\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nWhy might a government encourage a monopoly?\nA It can have high average costs.\nB It can compete against foreign firms.\nC It can prevent innovation.\nD It can make excessive profits.\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nWhich combination of government policies is most likely to be successful at reducing\nunemployment?\nA budgeting for a surplus and lowering interest rates\nB budgeting for a deficit and raising interest rates\nC budgeting for a surplus and raising interest rates\nD budgeting for a deficit and lowering interest rates\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nA government wishes to raise the general standard of living in its country.\n\nIn the short run, which policy would be the most likely to achieve this aim?\nA preventing the merger of two companies into a monopoly\nB raising taxation to repay government debts\nC reducing the rate of income tax while maintaining the services it provides\nD spending more on roads in rural areas rather than in city centres\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: Sam wrote a list of how he would prefer to spend his Saturday afternoon.\n\nfirst choice\ngo to a cricket match\nsecond choice\nwatch the annual town parade\nthird choice\ngo to the cinema\nfourth choice\nvisit relatives\n\nUnfortunately a thunderstorm caused the cricket match and the town parade to be cancelled.\nSam went to the cinema.\n\nWhat was the opportunity cost of going to the cinema?\nA going to the cricket match\nB watching the town parade\nC visiting his relatives\nD losing his Saturday free time\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: In which case is it possible to set the level of reward before production takes place for the first\nfactor of production but not for the second?\n\n\nfirst factor\nsecond factor\nA capital\nland\nB enterprise\nlabour\nC labour\ncapital\nD land\nenterprise\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: In the 2016 Olympics in Brazil, the opening ceremony will take place in the Maracana Stadium,\nwhich can seat 82 000 spectators. It is expected that all tickets for the ceremony will be sold\nquickly, leaving many people dissatisfied.\n\nWhat can be concluded from this?\nA Price elasticity of demand for tickets will be perfectly elastic.\nB Some people will be able to resell their tickets at a higher price than they paid for them.\nC The Olympic authority will make more tickets available for sale.\nD This will be an example of market failure.\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: In 2011, a company selling milk in glass bottles replaced them with new plastic bottles. When\nthey were introduced, the equilibrium quantity on the market fell.\n\nWhat could be a reason for this fall?\nA Consumers preferred the new bottle because it was lighter to carry.\nB Milk from the farms used to fill the bottle cost more.\nC The bottle was cheaper than the existing glass bottle to produce.\nD The new bottle was introduced with a successful advertising campaign.\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: Which change would make the supply of a product more price elastic?\nA an increase in the number of close substitutes for the product\nB an increase in the proportion of firms working at full capacity\nC a reduction in the time taken to make the product\nD a reduction in the time that the product can be stored\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: Which will encourage domestic producers to grow more maize?\nA granting subsidies to maize producers\nB increasing the sales tax on maize\nC removing guaranteed minimum prices for maize\nD removing quotas on imported maize\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: What will be the most likely effect of a fall in interest rates on saving and borrowing?\n\n\nsaving\nborrowing\nA decrease\ndecrease\nB decrease\nincrease\nC increase\ndecrease\nD increase\nincrease\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: When will a trade union find it easier to achieve higher wages for its members?\n\nA when consumers demand more of the product made\nB when the company has a decrease in profits\nC when the cost of raw materials increases\nD when unemployment increases\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: What might be a direct benefit to the individual worker of a specialised job?\nA Specialisation enables a better quality product to be produced.\nB Specialisation enables the firm to introduce more machinery.\nC Specialisation enables the worker to become more skilled.\nD Specialisation makes better use of resources.\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: Which function of money enables people to compare the worth of different products?\nA medium of exchange\nB standard for deferred payments\nC store of value\nD unit of account\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: Which of the following could not be a reason for imposing tariffs on imported goods?\n\nA to encourage self sufficiency\nB to lower the general price level within the economy\nC to protect a growing domestic industry\nD to reduce a balance of trade deficit\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: Which of the following is an export of Jamaica?\n\nA a loan to Jamaica by the International Monetary Fund\nB Jamaican holidays taken by American tourists\nC dividends paid by a company in Jamaica to its American shareholders\nD sales of Japanese cars in Jamaica\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: A developing country\u2019s two major sources of income from international trade are fishing and\ntourism.\n\nIf the country\u2019s exchange rate depreciated, what is likely to happen?\nA Imported goods would become cheaper for local people.\nB The country would definitely become poorer.\nC The price of fish sold as exports would become cheaper.\nD Tourists to the country would be discouraged by higher prices.\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: In some developing countries a large percentage of the population is involved in subsistence\nfarming.\n\n\nWhat can be concluded from this?\nA Each family will be able to produce enough to live on.\nB Production is unlikely to be capital intensive.\nC Production will be efficient.\nD There will be a high level of trade.\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: A country has a falling birth rate and a rising death rate while an increasing number of its working\nage adults (16-60 years) are seeking employment abroad.\n\nHow will this probably affect the numbers in the different age groups in the country?\n\n\nunder 16 years\n16-60 years\nover 60 years\nA fall\nfall\nfall\nB fall\nrise\nrise\nC rise\nfall\nrise\nD rise\nrise\nfall\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: Which would best indicate the start of an economic recession?\nA falling interest rates\nB fluctuating levels of employment\nC negative growth of GDP\nD steadily increasing price levels\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nSam wrote a list of how he would prefer to spend his Saturday afternoon.\n\nfirst choice\ngo to a cricket match\nsecond choice\nwatch the annual town parade\nthird choice\ngo to the cinema\nfourth choice\nvisit relatives\n\nUnfortunately a thunderstorm caused the cricket match and the town parade to be cancelled.\nSam went to the cinema.\n\nWhat was the opportunity cost of going to the cinema?\nA going to the cricket match\nB watching the town parade\nC visiting his relatives\nD losing his Saturday free time\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nIn which case is it possible to set the level of reward before production takes place for the first\nfactor of production but not for the second?\n\n\nfirst factor\nsecond factor\nA capital\nland\nB enterprise\nlabour\nC labour\ncapital\nD land\nenterprise\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nIn the 2016 Olympics in Brazil, the opening ceremony will take place in the Maracana Stadium,\nwhich can seat 82 000 spectators. It is expected that all tickets for the ceremony will be sold\nquickly, leaving many people dissatisfied.\n\nWhat can be concluded from this?\nA Price elasticity of demand for tickets will be perfectly elastic.\nB Some people will be able to resell their tickets at a higher price than they paid for them.\nC The Olympic authority will make more tickets available for sale.\nD This will be an example of market failure.\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nIn 2011, a company selling milk in glass bottles replaced them with new plastic bottles. When\nthey were introduced, the equilibrium quantity on the market fell.\n\nWhat could be a reason for this fall?\nA Consumers preferred the new bottle because it was lighter to carry.\nB Milk from the farms used to fill the bottle cost more.\nC The bottle was cheaper than the existing glass bottle to produce.\nD The new bottle was introduced with a successful advertising campaign.\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nWhich change would make the supply of a product more price elastic?\nA an increase in the number of close substitutes for the product\nB an increase in the proportion of firms working at full capacity\nC a reduction in the time taken to make the product\nD a reduction in the time that the product can be stored\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nWhich will encourage domestic producers to grow more maize?\nA granting subsidies to maize producers\nB increasing the sales tax on maize\nC removing guaranteed minimum prices for maize\nD removing quotas on imported maize\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: What will be the most likely effect of a fall in interest rates on saving and borrowing?\n\n\nsaving\nborrowing\nA decrease\ndecrease\nB decrease\nincrease\nC increase\ndecrease\nD increase\nincrease\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: When will a trade union find it easier to achieve higher wages for its members?\n\nA when consumers demand more of the product made\nB when the company has a decrease in profits\nC when the cost of raw materials increases\nD when unemployment increases\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: What might be a direct benefit to the individual worker of a specialised job?\nA Specialisation enables a better quality product to be produced.\nB Specialisation enables the firm to introduce more machinery.\nC Specialisation enables the worker to become more skilled.\nD Specialisation makes better use of resources.\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: Which function of money enables people to compare the worth of different products?\nA medium of exchange\nB standard for deferred payments\nC store of value\nD unit of account\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: What is a reason why firms making similar products sometimes locate near each other?\nA competition is decreased\nB there are external economies of scale\nC there are internal economies of scale\nD transport costs may be eliminated\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: To achieve horizontal integration a record company producing compact discs (CDs) could merge\nwith another firm.\n\nWhat would this firm most likely be doing?\nA owning shops selling CDs\nB producing CDs\nC producing CD players\nD producing machinery used in the making of CDs\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: What is a difference between a monopoly and a perfectly competitive firm?\nA A monopoly always has economies of scale and a perfectly competitive firm has\ndiseconomies of scale.\nB A monopoly always operates in the public sector and a perfectly competitive firm always\noperates in the private sector.\nC A monopoly is a price maker and a perfectly competitive firm is a price taker.\nD A monopoly seeks to maximise profits and a perfectly competitive firm seeks to maximise\noutput.\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: An entrepreneur started a small business making candles. In the first month 1000 candles were\nmade. The costs were\n\n$ raw materials\n1000\npackaging\n800\ninsurance\n100\ndepreciation\n100\nrent\n500\n\n\nWhat were the average variable costs for the month?\nA $1.00\nB $1.80\nC $1.90\nD $2.00\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: Which aim of government policy is most likely to be achieved by an increase in interest rates?\nA economic growth\nB greater equality of income\nC full employment\nD price stability\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: Why might a government encourage a monopoly?\nA It can have high average costs.\nB It can compete against foreign firms.\nC It can prevent innovation.\nD It can make excessive profits.\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: Which combination of government policies is most likely to be successful at reducing\nunemployment?\nA budgeting for a surplus and lowering interest rates\nB budgeting for a deficit and raising interest rates\nC budgeting for a surplus and raising interest rates\nD budgeting for a deficit and lowering interest rates\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: A government wishes to raise the general standard of living in its country.\n\nIn the short run, which policy would be the most likely to achieve this aim?\nA preventing the merger of two companies into a monopoly\nB raising taxation to repay government debts\nC reducing the rate of income tax while maintaining the services it provides\nD spending more on roads in rural areas rather than in city centres\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: Which would best indicate the start of an economic recession?\nA falling interest rates\nB fluctuating levels of employment\nC negative growth of GDP\nD steadily increasing price levels\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: A developing country\u2019s two major sources of income from international trade are fishing and\ntourism.\n\nIf the country\u2019s exchange rate depreciated, what is likely to happen?\nA Imported goods would become cheaper for local people.\nB The country would definitely become poorer.\nC The price of fish sold as exports would become cheaper.\nD Tourists to the country would be discouraged by higher prices.\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: In some developing countries a large percentage of the population is involved in subsistence\nfarming.\n\n\nWhat can be concluded from this?\nA Each family will be able to produce enough to live on.\nB Production is unlikely to be capital intensive.\nC Production will be efficient.\nD There will be a high level of trade.\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: A country has a falling birth rate and a rising death rate while an increasing number of its working\nage adults (16-60 years) are seeking employment abroad.\n\nHow will this probably affect the numbers in the different age groups in the country?\n\n\nunder 16 years\n16-60 years\nover 60 years\nA fall\nfall\nfall\nB fall\nrise\nrise\nC rise\nfall\nrise\nD rise\nrise\nfall\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: Which of the following could not be a reason for imposing tariffs on imported goods?\n\nA to encourage self sufficiency\nB to lower the general price level within the economy\nC to protect a growing domestic industry\nD to reduce a balance of trade deficit\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: Which of the following is an export of Jamaica?\n\nA a loan to Jamaica by the International Monetary Fund\nB Jamaican holidays taken by American tourists\nC dividends paid by a company in Jamaica to its American shareholders\nD sales of Japanese cars in Jamaica\n\n\nBLANK PAGE\nBLANK PAGE\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nA generating station was built to supply electricity to a rural village in Africa.\n\nWhat was the opportunity cost to the local economy?\nA the charge the villagers had to pay for the electricity\nB the cost of the building materials\nC the school that was not built as a result\nD the wages of the workers\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nIn a region of high unemployment, a manufacturer applied for a loan from the government so that\nthe number of machines in an existing factory could be increased. It was hoped this would also\nenable more workers to be employed.\n\nWhich factors of production does this decision involve?\nA labour and capital only\nB labour, capital and enterprise only\nC land, labour and capital only\nD land, labour, capital and enterprise\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nSome resources in a market economy are switched from producing chocolate bars to producing\nice cream.\n\nWhat could explain this?\nA an increase in the demand for ice cream and a decrease in the demand for chocolate bars\nB an increase in the profits from chocolate bars and a decrease in the profits from ice cream\nC an increase in the subsidy given to chocolate bar producers and a decrease in the subsidy\ngiven to ice cream producers\nD an increase in the tax on ice cream and a decrease in the tax on chocolate bars\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nMany people are life-long, devoted fans of the Los Angeles Lakers basketball team in the United\nStates. The team\u2019s stadium can seat 19 000 spectators and tickets are always sold out.\n\nWhat does this suggest about the price elasticity of demand and the price elasticity of supply of\ntickets to watch the Lakers play?\n\n\nprice elasticity of demand\nprice elasticity of supply\nA highly elastic\nperfectly elastic\nB highly elastic\nperfectly inelastic\nC highly inelastic\nperfectly elastic\nD highly inelastic\nperfectly inelastic\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nWhat is an example of market failure?\nA a firm forced to close because of fierce competition\nB a firm polluting rivers with waste chemicals\nC a high price for an essential product\nD a shortage of an agricultural crop\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nWhich will encourage domestic producers to grow more maize?\nA granting subsidies to maize producers\nB increasing the sales tax on maize\nC removing guaranteed minimum prices for maize\nD removing quotas on imported maize\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: What will be the most likely effect of a fall in interest rates on saving and borrowing?\n\n\nsaving\nborrowing\nA decrease\ndecrease\nB decrease\nincrease\nC increase\ndecrease\nD increase\nincrease\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: When will a trade union find it easier to achieve higher wages for its members?\n\nA when consumers demand more of the product made\nB when the company has a decrease in profits\nC when the cost of raw materials increases\nD when unemployment increases\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: What might be a direct benefit to the individual worker of a specialised job?\nA Specialisation enables a better quality product to be produced.\nB Specialisation enables the firm to introduce more machinery.\nC Specialisation enables the worker to become more skilled.\nD Specialisation makes better use of resources.\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: A merchant travels abroad for a few days to buy samples of low-value goods from a range of\nmanufacturers.\n\nWhich property of money would be least necessary for this to take place smoothly?\nA acceptability\nB divisibility\nC durability\nD portability\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: Some lawyers charge very high rates per hour for their services.\n\nWhat best explains this?\nA The lawyers are very skilled.\nB The lawyers work long hours.\nC The lawyers work part-time and need a high hourly rate.\nD The law profession is a popular career.\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: 39 of the 42 largest Chinese firms are described as state-owned enterprises.\n\nWhat form of organisation will these enterprises have?\nA co-operative\nB partnership\nC public company\nD public corporation\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: When a firm produces 500 units its total variable cost is $1000. Its total fixed cost is $1500.\n\nWhat is the average cost of 500 units?\nA $2\nB $3\nC $5\nD $2500\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: In 2011, the UK-based Rio Tinto, the world\u2019s second largest mining company, decided to bid for\nAustralian Coal and Allied Industries, another mining company.\n\nWhich economic concepts could be involved in this decision?\nA amalgamation and external economies\nB international finance and forward vertical integration\nC monopoly power and horizontal integration\nD multinational company and a more competitive market\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: Which aim of government policy is most likely to be achieved by an increase in interest rates?\nA economic growth\nB greater equality of income\nC full employment\nD price stability\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: Why might a government encourage a monopoly?\nA It can have high average costs.\nB It can compete against foreign firms.\nC It can prevent innovation.\nD It can make excessive profits.\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: What is an external economy of scale for a firm?\nA agreeing to produce large quantities exclusively for a major retailer\nB bulk buying of raw materials\nC obtaining discount rates from suppliers\nD sharing research from other firms\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: A government wishes to raise the general standard of living in its country.\n\nIn the short run, which policy would be the most likely to achieve this aim?\nA preventing the merger of two companies into a monopoly\nB raising taxation to repay government debts\nC reducing the rate of income tax while maintaining the services it provides\nD spending more on roads in rural areas rather than in city centres\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: An economy is said to have a high economic growth rate.\n\nWhat is most likely to be found when this occurs?\nA a decrease in inflation and a budget deficit\nB a decrease in the exchange rate and a fall in savings\nC an increase in GDP and low unemployment\nD an increase in inflation and a reduction in investment\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: Official statistics in 2010 showed South Africa had a very high unemployment rate at around\n25%, yet wages were still double those in Brazil.\n\nWhat might be a reason for South Africa\u2019s high wages in a time of unemployment compared with\nBrazil?\nA a skilled workforce in Brazil\nB high levels of savings in South Africa\nC increased use of labour-intensive production in Brazil\nD strong trade unions in South Africa\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: Which changes usually result when a country develops and is able to provide free health care\nand good living conditions?\n\n\nbirth rate\ndeath rate\nworker\nproductivity\nA falls\nfalls\nrises\nB falls\nrises\nfalls\nC rises\nfalls\nfalls\nD rises\nrises\nrises\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: What is not likely to be used to measure the difference in the standard of living between\ncountries?\nA Gross Domestic Product per head\nB Human Development Index\nC the rate of poverty\nD the rate of interest\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: How does a tariff differ from a quota?\nA A tariff is on exports, a quota is on imports.\nB A tariff is on the quantity of an import, a quota is on the price of an import.\nC A tariff raises government revenue, a quota raises no government revenue.\nD A tariff raises the price at which imports sell, a quota does not.\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: Which of the following is an export of Jamaica?\n\nA a loan to Jamaica by the International Monetary Fund\nB Jamaican holidays taken by American tourists\nC dividends paid by a company in Jamaica to its American shareholders\nD sales of Japanese cars in Jamaica\n\n\nBLANK PAGE\n\n\nBLANK PAGE\n\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nWhat is most likely to influence the price elasticity of demand for a food?\nA a change in consumer tastes\nB the number of close substitutes\nC the rate of inflation\nD whether the food can be stored easily\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nEconomics textbooks often start by identifying the existence of the basic economic problem.\n\nWhat is it that makes this problem \u2018basic\u2019?\nA It affects all economies and individuals.\nB It is the most urgent target of government economic policy.\nC It only affects low-income developing economies.\nD It relates to the production of raw materials in the primary sector.\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nWhich statement about the factors of production is correct?\nA Capital includes man-made machines that do not keep their original value.\nB Enterprise is a natural factor of production that cannot be taught.\nC Labour is an immobile factor that does not change its skill level.\nD Land is only agricultural fields that cannot be improved by human effort.\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nWhat is meant by the equilibrium quantity in the market for a product?\nA the average quantity produced over the year\nB the average quantity sold over the year\nC the quantity at which profit occurs\nD the quantity at which the demand and supply curves intersect\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nThe following is a headline from the newspaper.\n\nCar drivers to pay higher taxes\n\nWhat will result from an increased tax on cars?\nA increased employment in the car industry\nB increased petrol (gas) sales\nC reduced external costs of car use\nD reduced number of bus journeys\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nA group of workers in a firm joins a trade union.\n\nWhat would the union be expected to do?\nA arrange for labour-saving technology to be introduced\nB discuss safety issues in the workplace with the employer\nC ensure job security by promoting the firm\u2019s products through advertising\nD negotiate new contracts with major buyers of the firm\u2019s products\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nWhen might rapid inflation together with low interest rates be a source of concern for a\nconsumer?\nA when a consumer lives on a pension linked to the consumer price index\nB when a consumer needs to use savings for regular expenditure\nC when a consumer pays a fixed rent for their accommodation\nD when a consumer wishes to buy a good on credit\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: Asda, a supermarket chain, noticed a regular, sharp decrease in sales in the third week of the\nmonth as people ran out of cash before their next wage payment. The supermarket offered their\nbiggest price reductions at that time.\n\nWhy might this policy increase total revenue?\nA because consumers\u2019 demand curve shifts to the left in the third week of the month\nB because consumers\u2019 demand curve shifts to the right in the third week of the month\nC because the price elasticity of demand for Asda\u2019s products decreases in the third week of the\nmonth\nD because the price elasticity of demand for Asda\u2019s products increases in the third week of the\nmonth\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: In which occupations do wages tend to be lowest?\nA in those where the work is dangerous\nB in those where there is an excess supply of labour\nC in those where workers are paid on a monthly basis\nD in those where workers need long training\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: A large tyre manufacturer expands by taking over a rubber plantation.\n\nOf what is this an example?\nA backward vertical integration\nB diversifying integration\nC forward vertical integration\nD horizontal integration\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: What may exist in perfect competition but not in monopoly?\nA barriers to entry\nB economies of scale\nC many sellers\nD product differentiation\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: In 2011 the Egyptian Government increased the top rate of income tax.\n\nWhat is likely to have been the main aim of this policy measure?\nA a reallocation of resources from producing necessities to producing luxury products\nB a redistribution of income from the rich to the poor\nC a reduction in the deficit on the current account of the balance of payments\nD a reduction in the level of cost-push inflation\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: What describes a regressive tax?\nA It is paid by a higher proportion of high income earners.\nB It is paid by a higher proportion of low income earners.\nC It takes a higher proportion from high incomes.\nD It takes a higher proportion from low incomes.\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: 00\n\nHow did output per worker and average cost of the product change over the period?\n\n\noutput per worker\naverage cost\nA decrease\nno change\nB increase\ndecrease\nC increase\nno change\nD no change\nincrease\n\n\n18 A government aims to keep domestic prices stable in a fully employed economy.\n\nWhich policy should it use?\nA increase expenditure on defence\nB increase indirect taxes\nC increase the rate of interest\nD increase the wages of government workers\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: World population increased from 5.26 billion in 1990 to just over 7.00 billion in 2012. It is\npredicted to rise to 8.00 billion by 2025.\nWhat is most likely to explain this?\nA an increase in migration from developing to developed countries\nB an increase in the birth rate in developing countries\nC an increase in the death rate in developed countries\nD an increase in the death rate in developing countries\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: .5\n\u20137.1\n+0.2\nB Hungary\n10.9\n\u20130.8\n+5.5\nC Italy\n10.8\n\u20132.1\n+3.2\nD Spain\n24.8\n\u20131.6\n+2.0\n\n\n22 The table shows the percentage change (%) in employment over a period for a country with three\neconomic sectors.\n\neconomic sector\n(%) change in\nemployment\nagriculture\n\u20136\nmanufacturing\n+2\nservices\n+4\n\nWhat could be concluded from this information?\nA Agricultural output fell.\nB The country became more developed.\nC The working population stayed constant.\nD Total employment remained the same.\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: What must be a consequence of deflation in a country?\nA a decrease in its exports\nB a decrease in its saving\nC an increase in its employment\nD an increase in the real value of its money\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: What will increase the level of economic development in a country?\nA a higher infant mortality rate\nB a higher inflation rate\nC a higher interest rate\nD a higher literacy rate\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: What is most likely to be found in a developed country?\n\nA a small amount of income spent on leisure and entertainment\nB a small average family size\nC a small number of old people\nD a small number of professional people\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: Developing countries have, relatively, far more poor people than developed countries.\n\nWhat is the reason for this?\nA Developing countries have much higher fertility rates.\nB It is not possible for migrants from developing countries to work in developed countries.\nC The natural increase in population is lower in developing countries.\nD There is an ageing population in all developing countries.\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: Which change will increase the demand for imports?\nA Consumer credit becomes more expensive.\nB Income tax rates increase.\nC The exchange rate appreciates.\nD The government increases tariffs.\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: In recent years, the US has experienced a deficit on its overall current account of the balance of\npayments.\n\nWhat could have led to an increase in the size of the deficit?\nA increased competitiveness of goods made in the US\nB increased earnings by US investors in foreign companies\nC increased numbers of overseas visitors to the US\nD increased spending on US military bases abroad\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: When the US$ exchange rate falls it will usually\nA help to reduce a US trade deficit.\nB increase the foreign price of US exports.\nC reduce the price of US imports.\nD reduce US inflation.\n\n\nBLANK PAGE\n\n\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nEconomics textbooks often start by identifying the existence of the basic economic problem.\n\nWhat is it that makes this problem \u2018basic\u2019?\nA It affects all economies and individuals.\nB It is the most urgent target of government economic policy.\nC It only affects low-income developing economies.\nD It relates to the production of raw materials in the primary sector.\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nWhich statement about the factors of production is correct?\nA Capital includes man-made machines that do not keep their original value.\nB Enterprise is a natural factor of production that cannot be taught.\nC Labour is an immobile factor that does not change its skill level.\nD Land is only agricultural fields that cannot be improved by human effort.\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nWhat is most likely to influence the price elasticity of demand for a food?\nA a change in consumer tastes\nB the number of close substitutes\nC the rate of inflation\nD whether the food can be stored easily\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nWhat is meant by the equilibrium quantity in the market for a product?\nA the average quantity produced over the year\nB the average quantity sold over the year\nC the quantity at which profit occurs\nD the quantity at which the demand and supply curves intersect\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nThe following is a headline from the newspaper.\n\nCar drivers to pay higher taxes\n\nWhat will result from an increased tax on cars?\nA increased employment in the car industry\nB increased petrol (gas) sales\nC reduced external costs of car use\nD reduced number of bus journeys\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nA group of workers in a firm joins a trade union.\n\nWhat would the union be expected to do?\nA arrange for labour-saving technology to be introduced\nB discuss safety issues in the workplace with the employer\nC ensure job security by promoting the firm\u2019s products through advertising\nD negotiate new contracts with major buyers of the firm\u2019s products\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nIn which occupations do wages tend to be lowest?\nA in those where the work is dangerous\nB in those where there is an excess supply of labour\nC in those where workers are paid on a monthly basis\nD in those where workers need long training\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: When might rapid inflation together with low interest rates be a source of concern for a\nconsumer?\nA when a consumer lives on a pension linked to the consumer price index\nB when a consumer needs to use savings for regular expenditure\nC when a consumer pays a fixed rent for their accommodation\nD when a consumer wishes to buy a good on credit\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: Asda, a supermarket chain, noticed a regular, sharp decrease in sales in the third week of the\nmonth as people ran out of cash before their next wage payment. The supermarket offered their\nbiggest price reductions at that time.\n\nWhy might this policy increase total revenue?\nA because consumers\u2019 demand curve shifts to the left in the third week of the month\nB because consumers\u2019 demand curve shifts to the right in the third week of the month\nC because the price elasticity of demand for Asda\u2019s products decreases in the third week of the\nmonth\nD because the price elasticity of demand for Asda\u2019s products increases in the third week of the\nmonth\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: A large tyre manufacturer expands by taking over a rubber plantation.\n\nOf what is this an example?\nA backward vertical integration\nB diversifying integration\nC forward vertical integration\nD horizontal integration\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: What may exist in perfect competition but not in monopoly?\nA barriers to entry\nB economies of scale\nC many sellers\nD product differentiation\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: 00\nweek 3\n7 1700\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: 00\nweek 4\n8 1800\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: 00\n\nHow did output per worker and average cost of the product change over the period?\n\n\noutput per worker\naverage cost\nA decrease\nno change\nB increase\ndecrease\nC increase\nno change\nD no change\nincrease\n\n\n16 A government aims to keep domestic prices stable in a fully employed economy.\n\nWhich policy should it use?\nA increase expenditure on defence\nB increase indirect taxes\nC increase the rate of interest\nD increase the wages of government workers\n\n\n17 What describes a regressive tax?\nA It is paid by a higher proportion of high income earners.\nB It is paid by a higher proportion of low income earners.\nC It takes a higher proportion from high incomes.\nD It takes a higher proportion from low incomes.\n\n\n18 In 2011 the Egyptian Government increased the top rate of income tax.\n\nWhat is likely to have been the main aim of this policy measure?\nA a reallocation of resources from producing necessities to producing luxury products\nB a redistribution of income from the rich to the poor\nC a reduction in the deficit on the current account of the balance of payments\nD a reduction in the level of cost-push inflation\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: What must be a consequence of deflation in a country?\nA a decrease in its exports\nB a decrease in its saving\nC an increase in its employment\nD an increase in the real value of its money\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: World population increased from 5.26 billion in 1990 to just over 7.00 billion in 2012. It is\npredicted to rise to 8.00 billion by 2025.\nWhat is most likely to explain this?\nA an increase in migration from developing to developed countries\nB an increase in the birth rate in developing countries\nC an increase in the death rate in developed countries\nD an increase in the death rate in developing countries\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: What is most likely to be found in a developed country?\n\nA a small amount of income spent on leisure and entertainment\nB a small average family size\nC a small number of old people\nD a small number of professional people\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: What will increase the level of economic development in a country?\nA a higher infant mortality rate\nB a higher inflation rate\nC a higher interest rate\nD a higher literacy rate\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: Developing countries have, relatively, far more poor people than developed countries.\n\nWhat is the reason for this?\nA Developing countries have much higher fertility rates.\nB It is not possible for migrants from developing countries to work in developed countries.\nC The natural increase in population is lower in developing countries.\nD There is an ageing population in all developing countries.\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: When the US$ exchange rate falls it will usually\nA help to reduce a US trade deficit.\nB increase the foreign price of US exports.\nC reduce the price of US imports.\nD reduce US inflation.\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: Which change will increase the demand for imports?\nA Consumer credit becomes more expensive.\nB Income tax rates increase.\nC The exchange rate appreciates.\nD The government increases tariffs.\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: In recent years, the US has experienced a deficit on its overall current account of the balance of\npayments.\n\nWhat could have led to an increase in the size of the deficit?\nA increased competitiveness of goods made in the US\nB increased earnings by US investors in foreign companies\nC increased numbers of overseas visitors to the US\nD increased spending on US military bases abroad\n\n\n\nBLANK PAGE\n\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nWhich resource is an example of capital used in the fishing industry?\nA a fishing boat\nB fish\nC owners of firms in the industry\nD skilled workers in the industry\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nIn recent years more golf courses, which use large quantities of water, have opened in China.\n\nWhat may be the opportunity cost of this?\nA cost of water\nB loss of farmland\nC sales of golf equipment\nD wages of golf course staff\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nAs the demand for new houses increases, the demand for plumbers and electricians also\nincreases.\n\nWhat does this statement illustrate?\nA The demand for plumbers and electricians is complementary (joint) demand.\nB The productivity of plumbers and electricians increases continually.\nC There is no limit to the number of plumbers and electricians employed.\nD The supply of plumbers and electricians is totally elastic.\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nWhat is found in a mixed economy but not in a free market economy?\nA equilibrium prices\nB income tax\nC small firms\nD the profit motive\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nWhen personal computers (PCs) were first sold in the 1970s, prices were much higher than they\nare today.\n\nWhat is the most likely explanation?\nA Both quality and performance of PCs have improved.\nB Demand has increased due to advertising.\nC Improvements in technology have led to lower supply costs.\nD Production requires more spending on research.\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nA group of workers in a firm joins a trade union.\n\nWhat would the union be expected to do?\nA arrange for labour-saving technology to be introduced\nB discuss safety issues in the workplace with the employer\nC ensure job security by promoting the firm\u2019s products through advertising\nD negotiate new contracts with major buyers of the firm\u2019s products\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nIn which occupations do wages tend to be lowest?\nA in those where the work is dangerous\nB in those where there is an excess supply of labour\nC in those where workers are paid on a monthly basis\nD in those where workers need long training\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: In 2008, economic conditions in the UK were uncertain and the rate of inflation increased. It was\nreported that consumers had increased their purchases of rare stamps which continued to rise in\nvalue.\n\nWhat is not a reason for such purchases?\nA to avoid risk\nB to diversify their investments\nC to overcome the effects of inflation\nD to switch from spending to borrowing\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: The construction industry in Dubai relies on many migrant workers from India.\n\nWhich combination of changes in the economies of Dubai and India would be most likely to\nincrease the wages of construction workers in Dubai?\n\n\nDubai economy\nIndian economy\nA decrease in economic activity\ndecrease in economic activity\nB decrease in economic activity\nincrease in economic activity\nC increase in economic activity\ndecrease in economic activity\nD increase in economic activity\nincrease in economic activity\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: What is correct for a private monopoly but is not correct for a firm in perfect competition?\nA It aims to maximise its profits.\nB It can make losses.\nC It can restrict the level of competition.\nD It is run by an entrepreneur.\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: What must occur if a firm experiences economies of scale?\nA average costs decrease\nB profits decrease\nC the number of workers increases\nD total advertising costs decrease\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: 00\nweek 3\n7 1700\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: 00\nweek 4\n8 1800\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: 00\n\nHow did output per worker and average cost of the product change over the period?\n\n\noutput per worker\naverage cost\nA decrease\nno change\nB increase\ndecrease\nC increase\nno change\nD no change\nincrease\n\n\n16 A government policy results in an increase in government spending and a fall in the market price\nof a good.\n\nWhat is the government policy?\nA the application of an indirect tax to a luxury good\nB the introduction of a subsidy to wheat farmers\nC the privatisation of health services\nD the setting of a minimum price for milk\n\n\n17 What describes a regressive tax?\nA It is paid by a higher proportion of high income earners.\nB It is paid by a higher proportion of low income earners.\nC It takes a higher proportion from high incomes.\nD It takes a higher proportion from low incomes.\n\n\n18 In trying to achieve one of its aims a government may make it difficult to achieve another aim.\n\nWhat is an example of this conflict?\nA Achieving a more even distribution of income may prevent a rise in the average standard of\nliving.\nB Achieving an increase in economic growth may prevent full employment.\nC Achieving full employment may prevent stable prices.\nD Achieving steady prices may prevent a current account surplus on the balance of payments.\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: Which combination of changes could cause a fall in the purchasing power of workers in a\ncountry?\n\n\n% change in\nwages rates\n% change in\nthe price level\nA \u20132\n\u20134\nB 0\n\u20132\nC 4\n4 D\n4 6\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: What will increase when there is a period of deflation during which the general price level\ncontinues to fall?\nA confidence of investors\nB consumer demand\nC unemployment\nD wage rates\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: The information below relates to selected countries in 2012.\n\nconsumer prices\n(annual % change)\nunemployment rate\n(%)\nIndia\n\n+10.0\n9.8\nSweden\n\n+1.4\n8.8\nSwitzerland\n\n\u20130.4\n2.9\nVenezuela\n\n+22.8\n7.4\n\nWhat can be concluded from this information?\nA Inflation is a possible cause of unemployment.\nB Inflation is the only cause of unemployment.\nC Low unemployment is linked to high inflation.\nD There is a uniform link between the rate of inflation and unemployment.\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: As a country develops, what is most likely to happen?\nA There will be an increase in productivity.\nB There will be an increase in the birth rate.\nC There will be an increase in the death rate.\nD There will be reduced occupational mobility.\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: As a country develops, its provision of medical care for babies and old people improves.\n\nWhy might this cause a problem in raising living standards?\nA Gross Domestic Product will fall.\nB The dependency ratio will become higher.\nC The number of workers will fall.\nD The size of families in the short run will be smaller.\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: Which change would be most likely to cause an increase in the demand for the Turkish Lira?\nA increased investments by Turkish firms in Italy\nB increased profits sent to France by French companies in Turkey\nC increased purchases of German chemicals by Turkish firms\nD increased speculation that the value of the Turkish Lira will rise in the future\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: Which change will increase the quantity of a country\u2019s exports?\nA Foreign governments raise tariff rates.\nB The country\u2019s exchange rate depreciates.\nC The level of world income falls.\nD Transport costs become more expensive.\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: In September 2011 the Brazilian Government increased its tariff on imported Chinese cars.\n\nWhich change might have increased the number of cars Brazil imported from China in October\n2011?\nA a decrease in the quality of cars produced in Brazil\nB a decrease in the sales tax on cars produced in Brazil\nC an increase in the costs of producing cars in China\nD an increase in the value of China\u2019s currency\n\n\nBLANK PAGE\n\n\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nA business person employs two people to make sandwiches to sell in a cafe.\nAs well as labour, which factors of production are involved in this activity?\nA capital, enterprise and land\nB capital and land only\nC capital and enterprise only\nD enterprise and land only\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nWhy is choice an important part of the basic economic problem?\nA Choice is necessary to achieve an equilibrium price.\nB Limited resources have many uses.\nC Manufacturers produce a large variety of foods.\nD The market leads to an unequal distribution of goods.\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nA power plant is built to provide electricity to a rural area in Botswana.\nWhat is the opportunity cost to the local economy of building the plant?\nA the cost of the building materials\nB the price of electricity\nC the school which was not built as a result\nD the wages of the power plant workers\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nIn a mixed economy, output is produced by\nA private enterprise and individuals.\nB the market alone.\nC the state alone.\nD the state and private enterprise.\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nA developer built some large houses in a rural area which poorer people could not afford. The\nhouses destroyed an area of natural beauty.\n\nWhat type of market failure resulted from the development?\nA ignoring external cost\nB inequality of income\nC lack of information\nD price discrimination\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nA country\u2019s central bank raised the rate of interest from 1% to 4% per year.\nHow would this change have affected the amount saved and the cost of borrowing by individuals?\n\n\namount saved\ncost of borrowing\nA decreased\ndecreased\nB decreased\nincreased\nC increased\ndecreased\nD increased\nincreased\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: When will a trade union be less likely to be able to achieve a rise in wages for its members?\nA during a recession\nB in an economic boom\nC when productivity is rising\nD where there is a limited supply of labour\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: A market changes from perfect competition to monopoly.\n\nWhat is likely to happen to output and price in this market?\n\n\noutput\nprice\nA decrease\ndecrease\nB decrease\nincrease\nC increase\ndecrease\nD increase\nincrease\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: A company decided to reduce the price of its product by 10%.\n\nWhat would happen?\nA The firm\u2019s costs would decrease if the elasticity of demand was greater than one.\nB The firm\u2019s profits would increase if the elasticity of demand was greater than one.\nC The firm\u2019s revenue would increase if the elasticity of demand was greater than one.\nD The quantity sold would decrease if the elasticity of demand was less than one.\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: The world\u2019s open-cast mining of mineral ores is dominated by a few multinational companies\nwhich employ relatively few workers.\n\nWhat does this indicate?\nA Production is capital-intensive.\nB Productivity of labour is low.\nC The market is perfectly competitive.\nD There is a monopoly of world production.\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: Which statement about the meaning of government economic aims is correct?\nA Economic growth means that a country\u2019s real output must rise over time.\nB Full employment means that no one must be unemployed.\nC Price stability means that the price of all goods and services must remain unchanged.\nD Redistribution of income means that everyone must have equal incomes.\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: A government decided to increase its spending on building schools and hospitals.\n\nWhich aim of government policy is most likely to be achieved by this increase?\nA a balance of payments surplus\nB a stronger exchange rate\nC economic growth\nD price stability\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: To make Gross Domestic Product a better measure of comparative living standards it needs to\nbe adjusted by\nA deducting the effects of exports and inflation.\nB deducting the effects of imports and exports.\nC deducting the effects of population change and exports.\nD deducting the effects of population change and inflation.\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: What is not involved in the construction of a retail price index?\nA a base year\nB a basket of goods\nC the income tax rate\nD the weighting of products\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: What is likely to fall when the rate of unemployment in a country falls?\nA business confidence\nB consumer spending\nC government budget deficit\nD government revenue from taxes\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: How would the proportions of different age groups in the population compare between\nlow-income developing countries and high-income developed countries?\n\nLow-income developing countries would have a\nA higher proportion of the elderly and higher proportion of young people.\nB higher proportion of the elderly and lower proportion of young people.\nC lower proportion of the elderly and higher proportion of young people.\nD lower proportion of the elderly and lower proportion of young people.\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: Which feature would be most helpful in identifying a typical developing country?\nA the level of Gross Domestic Product\nB the rate of rural to urban migration\nC the size of geographical area\nD the size of the population\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: How is a sharp rise in the price of oil likely to be seen by different oil-consuming countries?\n\n\noil-consuming countries with\na low standard of living\noil-consuming countries with\na high standard of living\nA desirable and manageable\ndesirable and unmanageable\nB desirable and unmanageable\ndesirable and manageable\nC undesirable and manageable\nundesirable and unmanageable\nD undesirable and unmanageable\nundesirable and manageable\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: What is most likely to encourage international specialisation?\nA similarities in climate in different countries\nB the ability to produce products more cheaply than other countries\nC the discovery of oil in a country that had no oil before\nD very high international transport costs\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: Turkey\u2019s agricultural sector employs 48% of the country\u2019s workforce, compared with 17% in the\nUnited States (US) and 3.9% in France.\n\nWhat could be concluded from this?\nA France is likely to import more agricultural produce than the US.\nB The workers in France are not as productive as those in Turkey.\nC Total agricultural production is likely to be higher in Turkey than in the US.\nD Turkey is likely to be less developed than France.\n\n\nBLANK PAGE\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nIn a rural community of Southern Africa, women were responsible for planting and weeding crops\nby hand, while men used to control production and receive profits.\n\nWhich combination of factors of production was in operation?\n\n\nmen\nwomen\nA capital\nland\nB enterprise\nlabour\nC labour\ncapital\nD land\nenterprise\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nThe government of a prosperous country announced that it would offer free food to its citizens for\na year.\n\nWhat would be the effect of this measure?\nA Agricultural resources would become unlimited.\nB Human wants would become finite.\nC More resources would be devoted to food production.\nD The basic economic problem would be solved.\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nWhat is meant by an equilibrium price?\nA a government price that ensures fairness for all\nB a price that has no pressure to rise or fall\nC a price that maximises the profits of the producers\nD a price that maximises the satisfaction of the consumers\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nA developer built some large houses in a rural area which poorer people could not afford. The\nhouses destroyed an area of natural beauty.\n\nWhat type of market failure resulted from the development?\nA ignoring external cost\nB inequality of income\nC lack of information\nD price discrimination\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nHow do high direct taxes affect spending and how do high interest rates affect saving by wage-\nearners?\n\n\nspending\nsaving\nA decrease\ndecrease\nB decrease\nincrease\nC increase\ndecrease\nD increase\nincrease\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: A national trade union wishes to increase the wages of its members without reducing the\nnumbers employed.\n\nWhich factor would help the union to do this?\nA The demand for the industry\u2019s product is high.\nB The industry consists of a small number of well-organised employers.\nC The union workers have low-level skills.\nD The workers\u2019 wages are the largest cost of the industry.\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: The wage rate of a worker is reduced.\n\nWhich combination of characteristics of the job is most likely to cause the worker to stay in the\njob?\n\n\nadditional\nbonuses\njob security\nunsocial\nhours\nA high\nhigh\nmany\nB high\nhigh\nnone\nC low\nlow\nmany\nD low\nlow\nnone\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: What characteristics are found in a monopoly?\nA freedom of entry to the market and a single seller\nB freedom of entry to the market and many sellers\nC many buyers and a single seller\nD many buyers and many sellers\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: What must be falling if a firm is experiencing economies of scale?\nA average costs\nB external costs\nC fixed costs\nD total costs\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: A company supplying water spent $470 million creating a network of pipes to distribute water\nmore efficiently. It employed local workers and boosted the local economy. It also provided better\nfacilities for the tourist industry.\nWhat cannot be concluded from the above?\nA The company increased its profits.\nB There was a decrease in regional unemployment.\nC There were fixed costs of $470 million.\nD There were positive externalities.\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: What is most likely to be the responsibility of a government?\nA the building of a food processing plant\nB the building of a housing estate\nC the building of a large shopping centre\nD the building of a major rail link\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: Which statement about the meaning of government economic aims is correct?\nA Economic growth means that a country\u2019s real output must rise over time.\nB Full employment means that no one must be unemployed.\nC Price stability means that the price of all goods and services must remain unchanged.\nD Redistribution of income means that everyone must have equal incomes.\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: A government wishes to close the gap between the earnings of the rich and the poor.\n\nWhat should it do to achieve this aim?\nA increase progressive taxation\nB increase the rate of interest\nC increase the rate of sales tax\nD increase the supply of money\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: A government decided to increase its spending on building schools and hospitals.\n\nWhich aim of government policy is most likely to be achieved by this increase?\nA a balance of payments surplus\nB a stronger exchange rate\nC economic growth\nD price stability\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: The forecast for Germany\u2019s GDP growth in 2013 was 1.5%.\n\nWhat might cause economic growth?\nA an increase in imports\nB an increase in interest rates\nC an increase in productivity\nD an increase in unemployment\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: Which item does the Human Development Index (HDI) of a country include, in addition to real\nGDP per head and life expectancy at birth?\nA expenditure on law and order\nB literacy rate among adults\nC number of doctors\nD retirement age\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: Why might real GDP per head not be a good indicator of the standard of living in developing\ncountries?\nA It does not account for inflation.\nB It does not account for population changes.\nC It does not include primary production.\nD It does not include unpaid work on farms.\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: The richest 60% of the population in a developed economy received an increase in income.\n\nWhich row is correct as a result of this increase?\n\n\nabsolute poverty\nrelative poverty\nA increased\nincreased\nB increased\nremained constant\nC remained constant\nincreased\nD remained constant\nremained constant\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: According to the United Nations, the share of world population living in developing countries will\nincrease from 83% in 2003 to 88% in 2050.\n\nWhat is likely to be the major cause of this predicted change?\nA Climate change will lead to lower food output and starvation.\nB Improved education for girls will lead to a small decline in birth rates.\nC Increasing numbers of people will migrate to developed countries.\nD Modern medicine and sanitation will lead to a rapid decline in death rates.\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: A country imposes tariffs and quotas on imported goods.\n\nWhat will citizens of that country experience?\nA higher prices\nB higher welfare\nC higher unemployment\nD wider consumer choice\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: What is most likely to encourage international specialisation?\nA similarities in climate in different countries\nB the ability to produce products more cheaply than other countries\nC the discovery of oil in a country that had no oil before\nD very high international transport costs\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: Turkey\u2019s agricultural sector employs 48% of the country\u2019s workforce, compared with 17% in the\nUnited States (US) and 3.9% in France.\n\nWhat could be concluded from this?\nA France is likely to import more agricultural produce than the US.\nB The workers in France are not as productive as those in Turkey.\nC Total agricultural production is likely to be higher in Turkey than in the US.\nD Turkey is likely to be less developed than France.\n\n\nBLANK PAGE\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \n\u00a9 UCLES 2015\n0455/13/O/N/15\n\n1 Governments often try to influence the supply of factors of production in their economies.\nWhich factor\u2019s supply is a government least likely to be able to increase?\nA capital\nB enterprise\nC labour\nD land\n2 There has been increased concern about the way large firms exploit the environment.\nWhat is the main reason for this concern?\nA Large firms are unprofitable because of diseconomies of scale.\nB Large firms combine together to fix prices.\nC The exploitation of resources is expensive.\nD Unlimited wants will use up the finite resources.\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nA person works at home making small cakes. She can make 30 cakes an hour and works for four\nhours a day. The total cost of the ingredients is $50 and she sells the cakes for $2 each.\nWhat is the opportunity cost if she takes a working day for a holiday?\nA $50\nB $240\nC 30 cakes\nD 120 cakes\n3 \u00a9 UCLES 2015\n0455/13/O/N/15\nTurn over\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nFormer planned economies in Eastern Europe have changed to market economies.\nWhat is most likely to be observed in these economies?\nA greater government controls over labour mobility\nB increased production of capital goods rather than consumer goods\nC less choice for consumers\nD widespread privatisation of manufacturing and services\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nWhat is an example of a public good?\nA a theatre performance\nB an injection to prevent influenza\nC road signs and road markings\nD the collection of rubbish by a local authority\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nA developer built some large houses in a rural area which poorer people could not afford. The\nhouses destroyed an area of natural beauty.\nWhat type of market failure resulted from the development?\nA ignoring external cost\nB inequality of income\nC lack of information\nD price discrimination\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nWhich statement is correct when comparing low-income earners with high-income earners?\nA High-income earners are likely to save a higher proportion of any additional income received.\nB High-income earners spend proportionately more of their income.\nC Low-income earners are likely to spend a lower proportion of any additional income received.\nD Low-income earners save proportionately more of their income.\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: In the United States (US) in 2011, 7.6 million public sector workers (36% of public sector workers)\nwere members of trade unions, but only 7.1 million private sector workers (8% of private sector\nworkers) belonged to a trade union.\nWhat can be concluded from this information?\nA 28% of all workers belonged to a trade union in the US in 2011.\nB Collective bargaining was more a feature of the private sector than the public sector in the\nUS in 2011.\nC More people worked in the private sector than in the public sector in the US in 2011.\nD The working population in the US in 2011 was 14.7 million.\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: Car assembly workers usually earn more income than agricultural workers.\nWhat might explain this?\nA Car assembly has safer working conditions.\nB Car assembly involves more regular hours.\nC Car assembly is usually in smaller firms.\nD Car assembly produces a higher-value product.\n5 \u00a9 UCLES 2015\n0455/13/O/N/15\nTurn over\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: In some countries, former nationalised utilities, such as electricity, have been replaced by several\npublic limited companies.\nWhich change has occurred in the electricity market?\nA All profits are reinvested into the business by public limited companies.\nB Governments decide which company consumers must use.\nC Market prices are fixed by governments.\nD Public limited companies pay dividends to shareholders.\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: There has been a move away from labour-intensive to capital-intensive production in developed\neconomies.\n\nWhich type of activity remains labour-intensive?\nA assembling cars\nB designing clothes\nC farming cereals\nD manufacturing steel\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: In 2007, a huge industrial mining company attempted to buy another industrial mining company.\nThe attempt failed.\nIn 2010, the same mining company made an offer to buy a company that sells potash, which is\nused to improve agricultural soils.\nHow may the mining company\u2019s attempts to buy these other companies be described?\n\n2007\n2010\nA diversification\nhorizontal integration\nB horizontal integration\ndiversification\nC specialisation\nvertical integration\nD vertical integration\nspecialisation\n6 \u00a9 UCLES 2015\n0455/13/O/N/15\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: Governments use monetary policy such as increasing the rate of interest.\nWhat is a result of increasing the rate of interest?\nA It creates disincentives for wage earners.\nB It discourages investment by entrepreneurs.\nC It increases disposable income of consumers.\nD It reduces government transfer payments.\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: Which statement about the meaning of government economic aims is correct?\nA Economic growth means that a country\u2019s real output must rise over time.\nB Full employment means that no one must be unemployed.\nC Price stability means that the price of all goods and services must remain unchanged.\nD Redistribution of income means that everyone must have equal incomes.\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: In 2013, a government wanted to keep inflation low and also to decrease unemployment. It\ndecided to subsidise consumers wishing to purchase a house so that houses would become\nmore affordable to them. At the time, there was a shortage of houses.\nWhat is most likely to have happened to inflation, housebuilding and unemployment?\ninflation\nhousebuilding\nunemployment\nA fall\nno change\nfall\nB fall\nrise\nrise\nC rise\nno change\nrise\nD rise\nrise\nfall\n7 \u00a9 UCLES 2015\n0455/13/O/N/15\nTurn over\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: A government decided to increase its spending on building schools and hospitals.\nWhich aim of government policy is most likely to be achieved by this increase?\nA a balance of payments surplus\nB a stronger exchange rate\nC economic growth\nD price stability\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: GDP per head is regarded as a poor measure of living standards because it omits\nA environmental changes.\nB exports.\nC the income of the poor.\nD the profits of private businesses.\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: A large economy experiences a high rate of GDP growth.\nWhat is least likely to be a result of this growth?\nA Everybody in the economy will benefit.\nB Some people in the economy will benefit more than others.\nC Some people in other economies will benefit.\nD There will be economic growth in other economies.\n8 \u00a9 UCLES 2015\n0455/13/O/N/15\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: In developed countries, an ageing population has caused changes in the population structure.\nWhat is the result of this change?\nA an increase in the dependency ratio\nB employment conditions have improved\nC medical treatment is available to all\nD welfare services have improved\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: Assuming no other changes, the population is most likely to increase if there is a reduction in\nA the birth rate.\nB the death rate.\nC the fertility rate.\nD the inoculation rate.\n9 \u00a9 UCLES 2015\n0455/13/O/N/15\nTurn over\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: In August 2013, the Indian rupee reached a new low against the US dollar compared with the\nprevious month.\nWhat does this mean?\nA India\u2019s balance of trade would worsen.\nB Indian goods became cheaper in the US.\nC Investors would wish to buy Indian rupees.\nD More Indian students would study in the US.\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: What is most likely to encourage international specialisation?\nA similarities in climate in different countries\nB the ability to produce products more cheaply than other countries\nC the discovery of oil in a country that had no oil before\nD very high international transport costs\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: Turkey\u2019s agricultural sector employs 48% of the country\u2019s workforce, compared with 17% in the\nUnited States (US) and 3.9% in France.\nWhat could be concluded from this?\nA France is likely to import more agricultural produce than the US.\nB The workers in France are not as productive as those in Turkey.\nC Total agricultural production is likely to be higher in Turkey than in the US.\nD Turkey is likely to be less developed than France.\n11\n\u00a9 UCLES 2015\n0455/13/O/N/15\n\nBLANK PAGE\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nEach factor of production earns an income.\n\nWhat correctly identifies the income for labour and capital?\n\n\nlabour\ncapital\nA profit\ninterest\nB rent\nprofit\nC wages\nprofit\nD wages\ninterest\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nWhat could be the opportunity cost of a nuclear power station?\nA the running costs of the power station\nB a coal-fired power station\nC the current value of the power station\nD the cost of building the power station\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nThe market for a good was in equilibrium. A change occurred which resulted in a new equilibrium\nwith a higher price for the good and a lower quantity traded.\n\nWhat change would have caused this?\nA the demand curve moved to the left\nB the demand curve moved to the right\nC the supply curve moved to the left\nD the supply curve moved to the right\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nA government subsidises the production of pineapples.\n\nThis is likely to\nA increase the price of pineapples\nB raise the costs of supplying pineapples\nC raise revenue for the government\nD cause the supply of pineapples to increase at every price\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nWhat indicates the existence of external costs in an economy?\nA An international trade deficit has caused the country to be in debt.\nB National companies have borrowed from foreign investors.\nC Private costs of production are less than social costs.\nD Private costs of production are more than social benefits.\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nWhat might be a disadvantage to a trade union when arguing for an increase in its members\u2019 pay?\nA an increase in imports of a cheaper, similar product\nB the closure of a local training college resulting in fewer potential workers\nC the development of a new and profitable brand of the company\u2019s product\nD the development of new techniques that increase productivity\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nWhat shows the correct examples of income and wealth?\n\nincome\nwealth\nA dividends from shares\nwages\nB rent from a house\novertime payments\nC overtime payments\nwages\nD wages\nhouse\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: Nazmin Uddin works in a local office as a secretary three days a week. She lives with her parents\nin a small apartment.\n\nMeer Ali owns a successful fitness centre that employs about twenty people. He owns a large\nhouse.\n\nWhich is most likely to be correct?\nA Nazmin spends a smaller proportion of her income than Meer.\nB Nazmin saves most of her income.\nC Nazmin would find it easier than Meer to borrow money.\nD Nazmin has a lower disposable income than Meer.\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: A survey of managers in the USA revealed that most businessmen feel that a company\u2019s\nresponsibility is \u2018to serve the interests of owners, employees, customers and the public\u2019.\n\nThe idea of profit maximisation, in contrast, implies that a company\u2019s main responsibility should\nbe to the\nA customers\nB employees\nC owners\nD public\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: Some agricultural co-operatives have changed from labour-intensive to capital-intensive methods\nof production.\n\nWhat might be a cause of this change?\nA Average productivity of agricultural workers has increased.\nB Farming equipment has become more efficient.\nC People are eating less food for health reasons.\nD Some agricultural land has been sold for housing.\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: A government decides to sell the monopoly supply of gas to households to a private firm.\n\nHow could the government protect the interests of households after selling a large company to\nthe private sector?\nA by excluding all competition from foreign companies\nB by imposing a tax on excess profits\nC by introducing a quota system for imports of gas\nD by removing price controls on gas\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: In 2015, 70 000 extra people lost their jobs but total employment rose by 75 000. What could\nexplain this?\nA Some people may have emigrated.\nB Some people may have gone back to education.\nC Some people may have re-entered the labour force.\nD Some people may have retired early.\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \n24\n20\n15\n10\n5 0\nS3\nS1\nD1\nS2\nquantity supplied\n(000 kilos)\nprice\n($ per kilo)\nX \n\nWhat will be the new equilibrium price and quantity supplied as a result of the subsidy?\n\n\nequilibrium price\n($ per kilo)\nquantity supplied\n(000 kilos)\nA 10\n16\nB 13\n20\nC 15\n16\nD 20\n8 \n\n20 What is involved in the construction of a Retail Price Index?\nA a base year\nB incomes\nC price elasticity of products\nD quantity supplied\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: Why is nominal Gross Domestic Product not a good measure to compare the standard of living in\na country between two years?\nA It does not account for inflation.\nB It does not allow for savings.\nC It does not include government expenditure.\nD It only compares export prices with import prices.\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: In 2010 there was an increase in net emigration from Ireland.\n\nWhat is most likely to have caused this increase?\nA a decrease in job security abroad\nB a decrease in wage rates abroad\nC an increase in Ireland\u2019s real GDP\nD an increase in unemployment in Ireland\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: Some goods take a greater percentage of a typical household\u2019s total spending than others.\nHow is this accounted for in the construction of a Retail Price Index?\nA by deducting the goods and services\nB by giving a weight to the goods\nC by taking an average of price fluctuations during a year\nD by using the price elasticity of demand for the goods\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: Which outcome is least likely to be found with greater economic development?\nA A greater percentage of the population are highly educated.\nB A greater percentage of the population are homeowners.\nC A greater percentage of the population are old.\nD A greater percentage of the population are very poor.\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: A government introduces state benefits for the unemployed and increases the top rate of income\ntax to pay for the benefits.\n\nWhat effect will these changes have on poverty and the tax system?\n\n\npoverty\ntax system\nA increase\nmake it more progressive\nB increase\nmake it more regressive\nC reduce\nmake it more progressive\nD reduce\nmake it more regressive\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: The chart shows total world carbon emissions in 1995 and predicted emissions by 2035.\n\nUS\n22%\nW. Europe\n17%\nW.\nEurope\n12%\nE. Europe\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: %\nE. Europe\n19%\nChina\n11%\nChina\n17%\nother Asia\n6%\nother\nAsia\n14%\nMiddle East\n3%\nMiddle\nEast\n5%\nAfrica 3%\nAfrica\n8%\nJapan\n7%\n1995\n2035\ndeveloping\nworld\n27%\ndeveloping\nworld\n50%\ndeveloped\nworld\n50%\ndeveloped\nworld\n73%\nLatin\nAmerica 4%\nUS\n15%\nLatin\nAmerica\n6%\nJapan\n4%\n\n\nIf the chart proves to be correct, what will have happened by 2035?\nA Africa and the Middle East will have responsibility for the same amount of carbon emissions\nin 2035 as in 1995.\nB Between 1995 and 2035, the Middle East will have increased its industrialisation by as much\nas Latin America.\nC By 2035 the combined percentage of carbon emissions caused by Africa and Latin America\nwill have doubled.\nD The US will have decreased its carbon emissions by a smaller percentage than Western\nEurope.\n\n\n27 What encourages international specialisation?\nA a foreign exchange shortage\nB diseconomies of scale\nC free trade\nD quotas\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: A Japanese car manufacturer decided to produce its cars in a factory in Europe.\n\nWhat would not be a reason why they might have chosen to do this?\nA cheaper wage costs in Europe\nB the availability of raw materials\nC to gain external economies from skilled labour in Europe\nD to increase Japanese self-sufficiency\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: A government removed the quota on goods imported into the country.\n\nWhat is the most likely result of this?\nA a decrease in demand for domestic production\nB a decrease in domestic unemployment\nC a decrease in exports\nD a decrease in the balance of trade deficit\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nWhat is not a factor of production?\nA a $20 banknote\nB an office\nC a photocopier\nD a secretary\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nWhat could be the opportunity cost of a nuclear power station?\nA the running costs of the power station\nB a coal-fired power station\nC the current value of the power station\nD the cost of building the power station\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nIn 2014 private companies began to drill in areas of the country to exploit natural gas supplies\nthat were known to exist.\n\nmanufactured\ngoods\ngas supplies\nO R\nV S\nT U\n\n\nHow might this decision be represented on the diagram which shows a production possibility\ncurve for the country?\nA by a movement from R to S\nB by a movement from R to V\nC by a movement from S to T\nD by a movement from U to V\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nThe market for a good was in equilibrium. A change occurred which resulted in a new equilibrium\nwith a higher price for the good and a lower quantity traded.\n\nWhat change would have caused this?\nA the demand curve moved to the left\nB the demand curve moved to the right\nC the supply curve moved to the left\nD the supply curve moved to the right\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nThe demand for cocoa beans is price-inelastic.\n\nWhat is most likely to decrease as a result of an increase in demand for cocoa beans?\nA price of cocoa bean products\nB production of cocoa beans\nC profits of cocoa bean producers\nD unemployment among cocoa bean farmers\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nA government subsidises the production of pineapples.\n\nThis is likely to\nA increase the price of pineapples.\nB raise the costs of supplying pineapples.\nC raise revenue for the government.\nD cause the supply of pineapples to increase at every price.\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nWhat could increase the ability of a trade union to gain a pay rise for its members in a coat\nfactory?\nA a decrease in the demand for coats\nB a decrease in the number of people willing to work in the coat industry\nC a decrease in the productivity of workers making coats\nD a decrease in the sale of coat exports\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nWhat does net income mean?\nA income after allowing for price changes\nB income after paying regular household bills\nC income less tax and government deductions\nD income plus overtime payments\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: Nazmin Uddin works in a local office as a secretary three days a week. She lives with her parents\nin a small apartment.\n\nMeer Ali owns a successful fitness centre that employs about twenty people. He owns a large\nhouse.\n\nWhich is most likely to be correct?\nA Nazmin spends a smaller proportion of her income than Meer.\nB Nazmin saves most of her income.\nC Nazmin would find it easier than Meer to borrow money.\nD Nazmin has a lower disposable income than Meer.\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: A survey of managers in the USA revealed that most businessmen feel that a company\u2019s\nresponsibility is \u2018to serve the interests of owners, employees, customers and the public\u2019.\n\nThe idea of profit maximisation, in contrast, implies that a company\u2019s main responsibility should\nbe to the\nA customers.\nB employees.\nC owners.\nD public.\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: Why is a firm in perfect competition a price taker?\nA It has no information about market price.\nB Its output is too small to have any effect on market equilibrium.\nC There are few barriers to entry.\nD There are only a few firms in the industry.\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: A firm produced 200 cars a week and employed 50 workers. A fall in demand caused the firm to\nreduce its output to 160 cars a week and its labour force to 32.\n\nWhat was the percentage change in the firm\u2019s productivity?\nA It fell by 20%.\nB It fell by 25%.\nC It increased by 20%.\nD It increased by 25%.\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: A government decides to sell the monopoly supply of gas to households to a private firm.\n\nHow could the government protect the interests of households after selling a large company to\nthe private sector?\nA by excluding all competition from foreign companies\nB by imposing a tax on excess profits\nC by introducing a quota system for imports of gas\nD by removing price controls on gas\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: A government decides to increase the rate of income tax and spend the extra revenue on\nproviding training colleges.\n\nHow might this be described?\nA as fiscal and monetary policy\nB as fiscal and supply-side policy\nC as fiscal, monetary and supply-side policy\nD as monetary and supply-side policy\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: A newspaper reports that there has been an economic slump in an economy.\n\nWhat would an economist expect the immediate effect to be?\nA Production will decrease.\nB Saving will decrease.\nC Taxation will decrease.\nD The population will decrease.\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: How is the pattern of employment likely to change when a country becomes more developed?\nA from regular employment to seasonal employment\nB from rural employment to urban employment\nC from skilled employment to manual employment\nD from tertiary employment to primary employment\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: In 2010 there was an increase in net emigration from Ireland.\n\nWhat is most likely to have caused this increase?\nA a decrease in job security abroad\nB a decrease in wage rates abroad\nC an increase in Ireland\u2019s real GDP\nD an increase in unemployment in Ireland\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: What would be most likely to cause the population to decrease if other things remain constant?\nA a decrease in the birth rate\nB a decrease in the death rate\nC an increase in net immigration\nD an increase in the fertility rate\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: Developed countries have a high and increasing proportion of their population over the age of 65.\n\nWhich economic consequence will be most likely to result from this kind of population change?\nA Government transfer payments will increase.\nB More facilities will be needed to retrain workers.\nC There will be a rise in the economic growth rate.\nD The total savings in the economy will increase.\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: The chart shows total world carbon emissions in 1995 and predicted emissions by 2035.\n\nUS\n22%\nW. Europe\n17%\nW.\nEurope\n12%\nE. Europe\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: %\nE. Europe\n19%\nChina\n11%\nChina\n17%\nother Asia\n6%\nother\nAsia\n14%\nMiddle East\n3%\nMiddle\nEast\n5%\nAfrica 3%\nAfrica\n8%\nJapan\n7%\n1995\n2035\ndeveloping\nworld\n27%\ndeveloping\nworld\n50%\ndeveloped\nworld\n50%\ndeveloped\nworld\n73%\nLatin\nAmerica 4%\nUS\n15%\nLatin\nAmerica\n6%\nJapan\n4%\n\n\nIf the chart proves to be correct, what would have happened by 2035?\nA Africa will emit the least carbon.\nB China will cause about a third of the emissions of all developing areas shown.\nC Developed areas will have reduced their absolute amount of carbon emissions.\nD The US will have decreased its carbon emissions by a smaller percentage than Western\nEurope.\n\n\n27 What encourages international specialisation?\nA a foreign exchange shortage\nB diseconomies of scale\nC free trade\nD quotas\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: A Japanese car manufacturer decided to produce its cars in a factory in Europe.\n\nWhat would not be a reason why they might have chosen to do this?\nA cheaper wage costs in Europe\nB the availability of raw materials\nC to gain external economies from skilled labour in Europe\nD to increase Japanese self-sufficiency\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: A government removed the quota on goods imported into the country.\n\nWhat is the most likely result of this?\nA a decrease in demand for domestic production\nB a decrease in domestic unemployment\nC a decrease in exports\nD a decrease in the balance of trade deficit\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: In 2009 the exchange rate of the Singapore dollar changed from 1.49 = 1 US dollar to 1.43\nSingapore dollars = 1 US dollar.\n\nHow would this affect the import prices and export prices for Singapore?\n\n\nprices paid by Singapore\nfor imports\nprices paid to Singapore\nfor exports\nA decrease\ndecrease\nB decrease\nincrease\nC increase\ndecrease\nD increase\nincrease\n\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nAn oil company announced in 2015 that it was starting its drilling operations for oil deposits in the\nArctic Ocean.\n\nWhat will be the effect of this?\nA to increase the supply of raw materials\nB to reduce the level of technology available\nC to solve the economic problem\nD to worsen resource allocation\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nA self-employed fortune teller earns a living by reading the palms of people\u2019s hands.\n\nWhich factors of production are essential to this activity?\nA capital and enterprise\nB enterprise and labour\nC labour and land\nD land and capital\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nA government needs to decide how much to fine firms for causing the external costs of air\npollution in industrial areas.\n\nWhich external cost would be the most difficult to measure in monetary terms?\nA the discomfort associated with breathing\nB the expenditure on additional healthcare\nC the loss of earnings due to illness\nD the medical research into respiratory disease\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nWhat is an example of market failure?\nA city centre congestion\nB low economic growth\nC rising prices\nD trade deficits\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nA job offers employees piecework, commission, paid holidays and a company pension.\n\nWhich are non-wage factors?\nA commission and company pension\nB company pension and paid holidays\nC paid holidays and piecework\nD piecework and commission\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nWhen will a trade union be most likely to succeed in achieving the aims of its members?\nA when firms are trying to cut costs of production\nB when the rate of unemployment in the country is high\nC when trade union membership in the industry is compulsory\nD when workers are unskilled\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: When choosing an occupation people often consider things other than the wage-rate.\n\nWhat would not be a good match for the type of work that is desired?\n\n\ndesired aspect\noccupation\nA detailed work; career structure\nlawyer\nB outdoor lifestyle; regular hours\nfarmer\nC part-time hours; work with people\nsupermarket assistant\nD technical knowledge; responsibility\ntelephone engineer\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: Which is an internal diseconomy of scale?\nA a lack of communication in a firm\nB a reduction of cost by buying in bulk\nC a shortage of skilled labour in an area\nD traffic congestion in a particular area\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: What is not likely in an industry with many small firms?\nA high capital costs\nB high level of competition\nC low barriers to entry\nD low research expenditure\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: A major computer company announced that its profits had fallen below the level predicted.\n\nWhat might have caused this?\nA increased advertising costs that greatly improved sales\nB low prices that made the company\u2019s product competitive\nC new technology that reduced costs\nD reduced sales and low prices\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: What, when increased, will help a government to reduce the rate of inflation?\nA budget deficit\nB consumer spending\nC income tax\nD pensions\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: An economy has a deficit on its balance of trade in manufactured goods.\n\nWhich government policy will reduce this deficit?\nA a decrease in subsidies paid to local manufacturers\nB an increase in interest rates\nC an increase in sales tax on locally manufactured goods\nD an introduction of import duties on manufactured goods\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: What is most likely to decrease when employment increases?\nA economic growth\nB government welfare payments\nC the price level\nD the standard of living\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: Why is the Human Development Index (HDI) often considered to be better than Gross Domestic\nProduct (GDP) per head as a measure of living standards?\nA GDP per head excludes economic growth.\nB GDP per head ignores population growth.\nC HDI includes more than the production of goods and services.\nD HDI is calculated by the national government.\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: An economy is predicted to grow at a rate of 3% during the next year.\n\nWhat is most likely to cause this growth?\nA an increase in expenditure\nB an increase in interest rates\nC an increase in sales (goods and services) tax\nD an increase in the government\u2019s budget surplus\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: Which policy aims to maintain low inflation over a period of time?\nA imposing a minimum wage to be paid to workers\nB reducing interest rates to encourage borrowing\nC restricting the supply of money through the central bank\nD writing off the debts of low-income countries\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: What most accurately measures the international purchasing power of a currency?\nA the balance of payments\nB the exchange rate\nC the gross domestic product\nD the rate of inflation\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: The charts show the population structure of a country in 1960 and 2015.\n\n3 2\n1 0\n0 1\n2 3\nmale\nfemale\nage\n85+\n80 \u2013 84\nmillions\n75 \u2013 79\n70 \u2013 74\n65 \u2013 69\n60 \u2013 64\n55 \u2013 59\n50 \u2013 54\n45 \u2013 49\n40 \u2013 44\n35 \u2013 39\n30 \u2013 34\n25 \u2013 29\n20 \u2013 24\n15 \u2013 19\n10 \u2013 14\n5 \u2013 9\n0 \u2013 4\n3 2\n1 0\n0 1\n2 3\nmale\nfemale\nage\n1960\n2015\n85+\n80 \u2013 84\nmillions\n75 \u2013 79\n70 \u2013 74\n65 \u2013 69\n60 \u2013 64\n55 \u2013 59\n50 \u2013 54\n45 \u2013 49\n40 \u2013 44\n35 \u2013 39\n30 \u2013 34\n25 \u2013 29\n20 \u2013 24\n15 \u2013 19\n10 \u2013 14\n5 \u2013 9\n0 \u2013 4\n\n\nWhat decreased between 1960 and 2015?\nA average age\nB number of people below 15\nC number of people over 60\nD total population\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: What is a benefit of tariffs?\nA increased choice\nB increased government revenue\nC more competition\nD more trade\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: What is a country said to have if the value of its exported goods exceeds the value of its imported\ngoods?\nA a surplus on its balance of payments\nB a surplus on its balance of trade\nC a surplus on its capital account\nD a surplus on its current account\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: An Argentine product initially sells in the US for $50 when the exchange rate between the two\ncountries is 5 pesos to 1 dollar\n\nThe exchange rate changes to 10 pesos to 1 dollar and the price of the product remains\nunchanged in Argentina.\n\nWhat will be the new price of the product in the US?\nA $5\nB $25\nC $100\nD $500\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: The UK wants to increase exports to the US.\n\nWhat action will achieve this?\nA borrowing US dollars from international banks\nB devaluing UK pounds against the US dollar\nC placing a quota on imports from the US\nD selling US dollars to buy UK pounds\n\n\n\nBLANK PAGE\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nEconomists refer to factors of production.\n\nWhich is not a factor of production?\nA the fields of a farm\nB the machinery in a factory\nC the shares of a company\nD the staff in an office\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nA government allowed a building company to construct new houses which destroyed an area\ndesignated as an area of natural beauty.\n\nWhich concepts can be applied to this statement?\nA budget surplus; public sector\nB external cost; opportunity cost\nC government subsidy; mixed economy\nD private enterprise; budget deficit\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nWhat is the government most likely to produce in a mixed economy?\nA all of the services and none of the goods\nB amounts of goods and services equal to those of the private sector\nC no goods and services\nD some of the goods and services\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nWhich of the effects of economic development is an external cost?\nA higher employment\nB higher fixed costs\nC increased production\nD increased traffic congestion\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nIt was reported that the supply of oil would be affected by the discovery of new oil fields and\ndemand would be affected by rapid global economic growth.\n\nIf point X is the initial equilibrium point, which point could represent the new equilibrium?\n\nprice\nquantity\nO S2\nS1\nD2\nS3\nD1\nD3\nX A\nB C\nD \n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nWhat is likely to decrease the level of saving in an economy?\nA an increase in the general level of income\nB an increase in the number of cheap offers in shops\nC a redistribution of income from poor to rich households\nD a rise in the rate of interest\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nWhich change will make a manufacturing company replace machines with labour to maintain the\nmost efficient combination of factors of production?\nA The price of the product manufactured has increased.\nB The productivity of labour has increased.\nC The productivity of machinery has increased.\nD The wages of labour have increased.\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: Although there are higher paid jobs in offices many workers stay in low-paid jobs on farms.\n\nWhat might explain this in developing economies?\nA Agricultural workers lack the necessary education and skills.\nB Governments plan to increase indirect taxes on services.\nC Manual workers are being replaced by machines.\nD Workers on farms have high labour mobility.\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: Which is an internal diseconomy of scale?\nA a lack of communication in a firm\nB a reduction of cost by buying in bulk\nC a shortage of skilled labour in an area\nD traffic congestion in a particular area\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: What distinguishes a multinational company from other types of company?\nA It exports its products.\nB It imports its raw materials.\nC It produces outside its country of origin.\nD It promotes its products in trade fairs abroad.\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: A major computer company announced that its profits had fallen below the level predicted.\n\nWhat might have caused this?\nA increased advertising costs that greatly improved sales\nB low prices that made the company\u2019s product competitive\nC new technology that reduced costs\nD reduced sales and low prices\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: What, when increased, will help a government to reduce the rate of inflation?\nA budget deficit\nB consumer spending\nC income tax\nD pensions\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: The government introduces a new tax. It adds $1 to the price of every $10 good and $2 to the\nprice of every $20 good.\n\nWhat can be concluded about the nature of this tax?\n\n\nit is a\ndirect tax\nit is a\nspecific tax\nit is a\nprogressive tax\nA no\nno\nno\nB no\nno\nyes\nC yes\nyes\nno\nD yes\nyes\nyes\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: A worker earns $40 000 a year and pays 20% income tax.\n\nHe spends $5000 on electrical goods and $10 000 on a car, and pays 20% sales tax on each.\n\nHow much indirect tax does he pay?\nA $3000\nB $5000\nC $8000\nD $11 000\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: Why is the Human Development Index (HDI) often considered to be better than Gross Domestic\nProduct (GDP) per head as a measure of living standards?\nA GDP per head excludes economic growth.\nB GDP per head ignores population growth.\nC HDI includes more than the production of goods and services.\nD HDI is calculated by the national government.\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: A finance minister reported that the economy was experiencing inflation and economic growth.\n\nWhat would be evidence that both of these had occurred?\nA increased exports and increased output\nB increased imports and increased income tax\nC increased interest rates and increased net migration\nD increased prices and increased employment\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: What would be a cause of cost-push inflationary pressure in an industry which supplies mobile\n(cell) phones?\nA an increase in advertising expenses for mobile phones\nB an increase in export duties on mobile phones\nC an increase in income taxes on wages of employees\nD an increase in world demand for mobile phones\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: What is most likely to cause an increase in the population growth of a developing country?\nA a decrease in immigration\nB a decrease in the birth rate\nC a decrease in the death rate\nD a decrease in the standard of living\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: The charts show the population structure of a country in 1960 and 2015.\n\n3 2\n1 0\n0 1\n2 3\nmale\nfemale\nage\n85+\n80 \u2013 84\nmillions\n75 \u2013 79\n70 \u2013 74\n65 \u2013 69\n60 \u2013 64\n55 \u2013 59\n50 \u2013 54\n45 \u2013 49\n40 \u2013 44\n35 \u2013 39\n30 \u2013 34\n25 \u2013 29\n20 \u2013 24\n15 \u2013 19\n10 \u2013 14\n5 \u2013 9\n0 \u2013 4\n3 2\n1 0\n0 1\n2 3\nmale\nfemale\nage\n1960\n2015\n85+\n80 \u2013 84\nmillions\n75 \u2013 79\n70 \u2013 74\n65 \u2013 69\n60 \u2013 64\n55 \u2013 59\n50 \u2013 54\n45 \u2013 49\n40 \u2013 44\n35 \u2013 39\n30 \u2013 34\n25 \u2013 29\n20 \u2013 24\n15 \u2013 19\n10 \u2013 14\n5 \u2013 9\n0 \u2013 4\n\n\nWhat decreased between 1960 and 2015?\nA average age\nB number of people below 15\nC number of people over 60\nD total population\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: At the start of the year a developing country had a population of 1 000 000, its birth rate was 16.0\nper thousand per annum and its death rate was 8.0 per thousand per annum. At the end of the\nyear the population was 1 005 000.\n\nWhat could explain this change in the population?\nA The birth rate rose.\nB The death rate fell.\nC There were 3000 emigrants.\nD There were 5000 immigrants.\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: What is a benefit of tariffs?\nA increased choice\nB increased government revenue\nC more competition\nD more trade\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: Which name is given to the external value of a currency in terms of another currency?\nA the balance of trade\nB the exchange rate\nC the relative inflation rate\nD the supply of money\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: It was reported in 2011 that the United States (US) needed to achieve a lower current account\ndeficit.\n\nWhat would help this in the short run?\nA a protectionist policy\nB a strong exchange rate\nC increased private sector spending\nD investment in the US by multinational firms\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nWhat does an economist mean by the factor of production called capital?\nA goods that can be used to produce other goods\nB money used to start a business\nC resources that cannot be replaced\nD the profits of a company\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nA government decides to spend more on defence and cannot spend money on a new airport.\n\nWhich concepts can be applied to the above statement?\nA budget surplus; external cost\nB factor of production; private monopoly\nC public sector; opportunity cost\nD trade surplus; budget deficit\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nWhat might be an external cost of drinking alcohol?\nA the cost of a bottle of wine\nB the risk of illness from drinking alcohol\nC the risk of street violence\nD the tax paid to the government\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nWhat is a benefit of the market system?\nA Competition ensures choice for consumers.\nB Prices equal supply costs.\nC Unemployment is kept to a minimum.\nD Wage differentials are small.\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nWhat is the best example of specialisation?\nA a diversified engineering company\nB a general repairs handyman\nC a self-sufficient, non-trading country\nD an old person\u2019s helper and care assistant\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nWhich workers are most likely to gain the highest increase in wages from a pay rise of 2%?\nA airline pilots\nB farm workers\nC nurses\nD shop assistants\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: A female accountant in a private firm earns $80 per hour; a male Professor of Finance in a\ngovernment university earns $40 per hour. Each works the same number of hours.\n\nWhat could explain the difference in earnings?\nA It is difficult to measure the output per hour in each profession.\nB Pay in the private sector is profit-related but is not in the public sector.\nC Qualifications of accountants are lower than those of Professors of Finance.\nD Women are generally given preference over men in professional jobs.\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: Which is an internal diseconomy of scale?\nA a lack of communication in a firm\nB a reduction of cost by buying in bulk\nC a shortage of skilled labour in an area\nD traffic congestion in a particular area\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: Private multinational clothing companies operate in developing countries to reduce their average\ncosts of production.\n\nWhich feature of developing countries attracts them for this purpose?\nA In developing countries, clothing workers receive low wages.\nB In developing countries, foreign managers are allowed to pay no income tax.\nC In developing countries, multinationals are allowed to take profits out of the country.\nD In developing countries, there is a large market for fashion clothing.\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: A major computer company announced that its profits had fallen below the level predicted.\n\nWhat might have caused this?\nA increased advertising costs that greatly improved sales\nB low prices that made the company\u2019s product competitive\nC new technology that reduced costs\nD reduced sales and low prices\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: An entrepreneur buys a workshop for $10 000 to make picture frames. In the first year he spent\n$40 000 on materials and employed two workers. He paid the workers for each frame produced\nwith a total cost of $30 000. He bought a vehicle to deliver the frames for $10 000.\n\nWhat were his total variable costs?\nA $40 000\nB $70 000\nC $80 000\nD $100 000\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: What, when increased, will help a government to reduce the rate of inflation?\nA budget deficit\nB consumer spending\nC income tax\nD pensions\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: Which policy is most likely to increase the level of economic activity?\nA increasing the exchange rate\nB increasing the rate of interest\nC reducing government spending\nD reducing the general tax level\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: A government collects the following revenue in a year.\n\n\n$m\ncustoms duties\n100\ntaxes on goods\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: 0\ntaxes on income\n400\ntaxes on services\n300\n\nWhat is the amount of indirect tax revenue?\nA $200 m\nB $400 m\nC $500 m\nD $600 m\n\n\n20 Why is the Human Development Index (HDI) often considered to be better than Gross Domestic\nProduct (GDP) per head as a measure of living standards?\nA GDP per head excludes economic growth.\nB GDP per head ignores population growth.\nC HDI includes more than the production of goods and services.\nD HDI is calculated by the national government.\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: What may cause an immediate increase in the working population?\nA a higher birth rate\nB a higher death rate\nC a higher fertility rate\nD a higher rate of net immigration\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: What is likely to fall when the rate of unemployment falls?\nA business confidence\nB consumer spending\nC government revenue\nD government welfare payments\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: The birth rate and death rate in a country are the same.\nWhat is likely to happen if there is a decrease in the birth rate, while the death rate and migration\nremain the same?\nA population structure will remain the same\nB population will decrease\nC the standard of living will decrease\nD the working population will increase\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: The charts show the population structure of a country in 1960 and 2015.\n\n3 2\n1 0\n0 1\n2 3\nmale\nfemale\nage\n85+\n80 \u2013 84\nmillions\n75 \u2013 79\n70 \u2013 74\n65 \u2013 69\n60 \u2013 64\n55 \u2013 59\n50 \u2013 54\n45 \u2013 49\n40 \u2013 44\n35 \u2013 39\n30 \u2013 34\n25 \u2013 29\n20 \u2013 24\n15 \u2013 19\n10 \u2013 14\n5 \u2013 9\n0 \u2013 4\n3 2\n1 0\n0 1\n2 3\nmale\nfemale\nage\n1960\n2015\n85+\n80 \u2013 84\nmillions\n75 \u2013 79\n70 \u2013 74\n65 \u2013 69\n60 \u2013 64\n55 \u2013 59\n50 \u2013 54\n45 \u2013 49\n40 \u2013 44\n35 \u2013 39\n30 \u2013 34\n25 \u2013 29\n20 \u2013 24\n15 \u2013 19\n10 \u2013 14\n5 \u2013 9\n0 \u2013 4\n\n\nWhat decreased between 1960 and 2015?\nA average age\nB number of people below 15\nC number of people over 60\nD total population\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: What is a benefit of tariffs?\nA increased choice\nB increased government revenue\nC more competition\nD more trade\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: What is an increase in the value of an exchange rate of a currency in a floating system called?\nA appreciation\nB depreciation\nC devaluation\nD revaluation\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: A developing economy has a surplus on its trade in goods of $75 billion and a deficit on its trade\nin services of $25 billion, while its current account is in overall balance.\n\nWhich values for net income (primary income) and net transfers (secondary income) result in the\ncurrent account being in balance?\n\n\nnet income\nnet transfers\nA deficit of $20 billion\nsurplus of $120 billion\nB deficit of $30 billion\ndeficit of $70 billion\nC surplus of $35 billion\nsurplus of $15 billion\nD surplus of $40 billion\ndeficit of $90 billion\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: What policy would encourage greater international specialisation?\nA the promotion of industrial diversification\nB the protection of new businesses\nC the reduction of tariffs\nD the subsidising of service industries\n\n\n\nBLANK PAGE\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nWhich factor of production involves risk-taking?\nA capital\nB enterprise\nC labour\nD land\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nWhat is the basic problem facing all economies?\nA how to achieve a stable balance of payments\nB how to maximise tax revenues\nC how to reach full employment\nD how to use scarce resources\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nAn economy operates entirely as a market system.\n\nWhich type of service would not be provided in such an economy?\nA commercial banking services\nB free government health services\nC private educational services\nD profitable retail services\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nA major highway has been built at a cost of US$175 million between Nairobi, Kenya and its\nsuburbs. This reduces travel time and increases safety, but there are environmental problems for\nsmall enterprises along its route.\n\nWho bears the external costs of this project?\nA the authorities who paid for the highway\nB the commuters who travel to work in Nairobi\nC the construction companies that built the highway\nD the small enterprises along the route\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nWhat is a function of a central bank?\nA collecting taxes\nB issuing currency\nC providing bank accounts for individuals\nD setting foreign trade tariffs\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nWhat is most likely to increase the total output of a firm in the short run?\nA a rise in the length of the working day\nB a rise in the number of days holiday\nC a rise in the school leaving age\nD a rise in unemployment payments\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: What will make it harder for a trade union to increase the wage rate for its members, without\nreducing employment?\nA a switch from short-term to long-term fixed contracts of employment\nB an increase in the number of substitutes for the product\nC growth in an economy and increased demand for labour\nD lower price elasticity of demand for the product\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: What is likely to assist a government\u2019s policy of reducing inflation?\nA allowing businesses to borrow money for longer periods\nB encouraging the public to spend more money\nC increasing lending to members of the public\nD raising the interest rate on credit card borrowing\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: Which international market is closest to the model of perfect competition?\nA diamonds\nB foreign currency\nC petrol (fuel)\nD washing machines\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: Which form of production would be least likely to have the advantages of economies of scale?\nA car manufacturing\nB commercial cereal farming\nC handmade jewellery\nD refining of oil products\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \n25\n15\nD 20\n30\n18\n\n\n15 Which statement about total fixed cost is correct?\nA It falls as output increases.\nB It is calculated by adding total cost and total variable cost.\nC It is calculated by dividing total cost by output.\nD It must be paid even if output is zero.\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: What is a disadvantage of direct taxes?\nA They can be a disincentive to work.\nB They can be based on people\u2019s ability to pay.\nC They can be a major source of tax revenue.\nD They can be progressive.\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: When is a government said to balance its budget?\nA when all goods and services are taxed equally\nB when economic growth is the same in all regions of the economy\nC when its total income equals its total expenditure\nD when total exports equal total imports\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: In which case is success for the government in achieving the first aim likely to cause problems in\nachieving the second?\n\n\nfirst aim\nsecond aim\nA full employment\nprice stability\nB high economic growth\nfull employment\nC price stability\nstable balance of payments\nD stable balance of payments\nmore even distribution of income\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: An increase in which economic indicator is usually taken as the measure of a country\u2019s economic\ngrowth?\nA the balance of payments surplus\nB the foreign exchange rate\nC the government budget surplus\nD the gross domestic product\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: What is used to measure inflation?\nA the consumer prices index (CPI)\nB the exchange rate\nC the gross domestic product (GDP)\nD the index of workers\u2019 wages\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: A country experienced its usual August increase in the rate of unemployment. Unfortunately this\nwas followed by the loss of jobs resulting from the regular downturn in global economic activity.\n\nWhich types of unemployment occurred?\n\n\nfirst type of\nunemployment\n(August)\nsecond type of\nunemployment\n(global downturn)\nA cyclical\nstructural\nB frictional\nseasonal\nC seasonal\ncyclical\nD structural\nfrictional\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: Iran has recently experienced a natural increase in population.\n\nWhat is the most likely cause of this increase?\nA Emigration exceeded immigration.\nB Immigration exceeded emigration.\nC The birth rate exceeded the death rate.\nD The death rate exceeded the birth rate.\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: Developing countries are sometimes given aid by charities and foreign governments.\n\nWhich aid programme would be least likely to lead to long-term economic growth?\nA the building of an irrigation system\nB the construction of a new airport\nC the distribution of gifts of food\nD the training of technical staff\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: What is a valid economic argument in favour of trade protection?\nA It allows greater consumer choice.\nB It encourages trade liberalisation.\nC It helps support infant industries.\nD It keeps prices lower.\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: Which government policy is most likely to improve a country\u2019s balance of trade?\nA a decrease in direct taxation\nB a decrease in the exchange rate\nC a decrease in the level of tariffs\nD an increase in government expenditure\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nWhich factor of production is not represented in the list shown?\n\nbananas a factory goats a risk taking investor\n\nA capital\nB enterprise\nC labour\nD land\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nWhat do economies aim to achieve in tackling the economic problem of scarcity?\nA equal balance between public and private sectors\nB equal reward for equal effort\nC increased competition in the use of resources\nD optimum allocation of finite resources\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nChina, the world\u2019s second largest economy, is becoming more like a market economy.\n\nWhich policy would contribute directly to such a change?\nA abolishing state control completely\nB encouraging consumers to spend more and save less\nC reducing exports and encouraging more imports\nD transferring wealth from the state sector to the private sector\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nCoal production in the UK has declined in recent years. One reason given for this is that the\nsocial cost of coal production is too high.\n\nWhat best describes the social cost of coal production?\nA all the benefits of coal production minus all the costs of coal production\nB the cost of the environmental damage caused by coal production\nC the cost to the government of subsidising the coal industry\nD the private costs of coal production plus the external costs of coal production\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nA central bank acts as a lender of last resort especially in times of financial crisis.\n\nWhat is the purpose of this function?\nA to cover credit card debts of consumers\nB to provide liquidity to the banking system\nC to remove failing banks from the financial system\nD to safeguard the profits of the banking system\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nWhat will cause the level of savings in an economy to rise?\nA a fall in investment\nB a fall in real wages\nC a rise in income taxes\nD a rise in interest rates\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: What could affect the size of the labour force in an economy?\nA the existence of a trade union\nB the government\u2019s immigration policy\nC the quality of university graduates\nD the ratio of male to female employees\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: Petrol (fuel) retailers in a country have noticed a sharp increase in sales in August when many\npeople take their holidays.\n\nWhy might this take place?\nA Consumers\u2019 demand curve for petrol shifts to the left in August.\nB Consumers\u2019 demand curve for petrol shifts to the right in August.\nC Oil refineries increase their output in August.\nD Travel companies increase their hotel prices in August.\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: What is correct for firms in perfect competition?\nA They achieve economies of scale.\nB They are price takers.\nC They make use of non-price competition.\nD They produce differentiated products.\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: A film production company purchases a group of cinemas.\n\nOf what is this an example?\nA backward vertical integration\nB conglomerate merger\nC forward vertical integration\nD horizontal integration\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \n25\n15\nD 20\n30\n18\n\n\n15 Which statement about total fixed cost is correct?\nA It falls as output increases.\nB It is calculated by adding total cost and total variable cost.\nC It is calculated by dividing total cost by output.\nD It must be paid even if output is zero.\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: A government aims to reduce unemployment through a supply-side policy measure.\n\nWhich measure would it use?\nA It would increase government spending.\nB It would increase tariffs on imported goods and services.\nC It would introduce retraining schemes.\nD It would reduce the rate of interest.\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: When is a government said to balance its budget?\nA when all goods and services are taxed equally\nB when economic growth is the same in all regions of the economy\nC when its total income equals its total expenditure\nD when total exports equal total imports\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: In which case is success for the government in achieving the first aim likely to cause problems in\nachieving the second?\n\n\nfirst aim\nsecond aim\nA full employment\nprice stability\nB high economic growth\nfull employment\nC price stability\nstable balance of payments\nD stable balance of payments\nmore even distribution of income\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: Economic growth is usually measured by the annual change in\nA consumer spending.\nB gross domestic product.\nC the output of the manufacturing and construction industries.\nD the retail price index (RPI).\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: Four groups who are affected by changing economic conditions are creditors, debtors, exporters\nand importers.\n\nWhich pair is most likely to be disadvantaged by a high rate of inflation?\nA creditors and exporters\nB creditors and importers\nC debtors and exporters\nD debtors and importers\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: A country experienced its usual August increase in the rate of unemployment. Unfortunately this\nwas followed by the loss of jobs resulting from the regular downturn in global economic activity.\n\nWhich types of unemployment occurred?\n\n\nfirst type of\nunemployment\n(August)\nsecond type of\nunemployment\n(global downturn)\nA cyclical\nstructural\nB frictional\nseasonal\nC seasonal\ncyclical\nD structural\nfrictional\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: What will lead to an ageing population if other factors remain unchanged?\nA a fall in the birth rate\nB a rise in the death rate\nC an increase in the age of retirement\nD an increase in the state pension\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: Which change is most likely to be expected when an economy is developing?\nA birth rates increase rapidly\nB poverty rates fall\nC unemployment levels rise\nD the primary sector overtakes the secondary sector\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: Developing countries are sometimes given aid by charities and foreign governments.\n\nWhich aid programme would be least likely to lead to long-term economic growth?\nA the building of an irrigation system\nB the construction of a new airport\nC the distribution of gifts of food\nD the training of technical staff\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: It is estimated that in 2016 the Olympic Games in Rio, Brazil attracted over 600 000 foreign\nvisitors.\n\nWhat is likely to have been the result of this number of visitors?\nA a depreciation of Brazil\u2019s currency\nB a fall in Brazil\u2019s rate of inflation\nC an increase in the Brazilian government\u2019s budget deficit\nD a reduction in Brazil\u2019s deficit on the current account of its balance of payments\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: A country has experienced a devaluation of its currency.\n\nWhat are the likely results of the devaluation?\n\nimports\nexports\nA price decreases\nvalue decreases\nB price decreases\nvalue increases\nC price increases\nquantity decreases\nD price increases\nquantity increases\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nWhich example of a factor of production in the fishing industry is correct?\n\n\nfactor\nexample\nA capital\ncharges on loan for fishing boat\nB enterprise\nsalaries of fish warehouse managers\nC labour\nprofits of fish shop owners\nD land\nfish in the sea\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nHospital services are provided by the government and paid for through taxation. People cannot\nalways get the treatment they require because of long waiting lists.\n\nOf what is this an example?\nA external cost\nB market system\nC perfectly inelastic supply\nD scarcity\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nWho determines what goods and services are produced in a market economy?\nA consumers\nB employees\nC government\nD trade unions\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nIn 2015, the world price of oil fell rapidly due to changes in the conditions of demand and supply.\nOne change was the use of a new method of extraction called fracking.\n\nWhich event would not have contributed to the fall in prices?\nA China\u2019s growth slowed leading to lower oil imports.\nB Saudi Arabia increased the volume of its oil supplies.\nC UK protest groups prevented the introduction of fracking projects.\nD USA became more self-sufficient in oil due to fracking and reduced imports.\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nWhat is a function of a country\u2019s stock exchange?\nA to act as lender of last resort to commercial banks\nB to provide a market for the purchase and sale of shares\nC to provide short-term loans for investment\nD to set interest rates within the country\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nWhat might cause an increase in the earnings of a doctor in a government health service?\nA an increasing number of doctors graduate from university each year\nB an increasing number of people need health care\nC the government spends less on the nation\u2019s health services\nD the population becomes more aware of healthy eating\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: What would put a trade union in a strong bargaining position to negotiate higher wages for its\nmembers in a particular firm?\nA The demand for the product produced by the workers has an inelastic demand.\nB The economy is experiencing high unemployment.\nC The proportion of the firm\u2019s workers in the union is low.\nD Wage costs are a high proportion of total costs for firms in the industry.\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: What is most likely to encourage the immediate purchase of an expensive item such as a new\ncar?\nA anticipating a fall in the rate of inflation\nB expecting interest rates to fall\nC making it easier to obtain a loan\nD needing to plan for unexpected emergencies\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: A computer chip manufacturer expands by taking over a computer chip designer.\n\nOf what is this an example?\nA backward vertical integration\nB diversifying integration\nC forward vertical integration\nD horizontal integration\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \n25\n15\nD 20\n30\n18\n\n\n15 Which statement about total fixed cost is correct?\nA It falls as output increases.\nB It is calculated by adding total cost and total variable cost.\nC It is calculated by dividing total cost by output.\nD It must be paid even if output is zero.\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: What is most likely to be an example of a progressive tax?\nA customs duties on imported goods\nB excise duties on cigarettes\nC income tax\nD sales tax\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: When is a government said to balance its budget?\nA when all goods and services are taxed equally\nB when economic growth is the same in all regions of the economy\nC when its total income equals its total expenditure\nD when total exports equal total imports\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: In which case is success for the government in achieving the first aim likely to cause problems in\nachieving the second?\n\n\nfirst aim\nsecond aim\nA full employment\nprice stability\nB high economic growth\nfull employment\nC price stability\nstable balance of payments\nD stable balance of payments\nmore even distribution of income\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: When is a recession said to occur?\nA Economic growth in the economy falls for at least two consecutive quarters.\nB Gross domestic product (GDP) falls for at least two consecutive quarters.\nC The current account of the balance of payment is in deficit for at least two consecutive\nquarters.\nD The government experiences a budget deficit for at least two consecutive quarters.\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: Which country is suffering from the worst deflation?\n\n\nannual change in indicator\ninflation\n% unemployment\nrate\n% real GDP\nper capita\n(US$)\n% A\n\u20135\n+3\n\u20133\nB \u20132\n\u20132\n\u20132\nC +2\n\u20133\n+1\nD +12\n+10\n+3\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: A country experienced its usual August increase in the rate of unemployment. Unfortunately this\nwas followed by the loss of jobs resulting from the regular downturn in global economic activity.\n\nWhich types of unemployment occurred?\n\n\nfirst type of\nunemployment\n(August)\nsecond type of\nunemployment\n(global downturn)\nA cyclical\nstructural\nB frictional\nseasonal\nC seasonal\ncyclical\nD structural\nfrictional\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: What is the most likely effect of raising the retirement age in a country?\nA government spending increases\nB net immigration increases\nC spending on pensions increases\nD working population increases\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: What describes absolute and relative poverty?\n\n\nabsolute poverty\nrelative poverty\nA \nwhen there are low birth rates, high death\nrates, and high levels of migration\nwhen there are high birth rates, low death\nrates, and low levels of migration\nB \nwhen a person does not have enough\nmoney for food, shelter, and clothes\nwhen a person earns less than\nothers in the same society\nC \nwhen everyone has an\nincome below US$1.90 a day\nwhen half the population has an\nincome of US$1.90 a day\nD when necessities cannot be afforded\nwhen luxuries cannot be afforded\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: Developing countries are sometimes given aid by charities and foreign governments.\n\nWhich aid programme would be least likely to lead to long-term economic growth?\nA the building of an irrigation system\nB the construction of a new airport\nC the distribution of gifts of food\nD the training of technical staff\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: A government imposes a limit of 2 million on the number of smartphones imported into the\ncountry.\n\nWhich term is given to this limitation?\nA ban\nB embargo\nC quota\nD tariff\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: In July 2015, Australia\u2019s balance of trade with the rest of the world was \u20132809 billion Australian\ndollars. In January 2016 it was \u20133294 billion Australian dollars.\n\nWhat describes Australia\u2019s balance of trade over this period?\n\n\nbalance of trade\ntrend\nA deficit\nimproving\nB deficit\nworsening\nC surplus\nimproving\nD surplus\nworsening\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nWhat is classified as one of the four economic resources?\nA consumption\nB enterprise\nC production\nD trade\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nSam wrote a list of how he would prefer to spend his Saturday afternoon.\n\nfirst choice\ngo to a cricket match\nsecond choice\nwatch the annual town parade\nthird choice\ngo to the cinema\nfourth choice\nvisit relatives\n\nUnfortunately a thunderstorm caused the cricket match and the town parade to be cancelled.\nSam went to the cinema.\n\nWhat was the opportunity cost of going to the cinema?\nA going to a cricket match\nB watching the annual town parade\nC visiting relatives\nD losing his Saturday free time\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nWhich pair of economic institutions can be found in a market economy?\nA local government and charities\nB monopolies and commercial banks\nC nationalised industries and partnerships\nD stock exchange and public corporations\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nIn a city, what is most unlikely to be provided by the private market system?\nA a museum\nB a school\nC a sports field\nD street lights\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \n500\n500\n6 600\n400\n\nWhat would happen to the equilibrium price if the quantity supplied increased by 200 units at\neach price?\nA It would decrease by $1.\nB It would decrease by $2.\nC It would increase by $1.\nD It would increase by $2.\n\n\n7 The table shows the quantity that producers are willing to supply at different price levels.\n\nprice\n($)\nquantity\nsupplied\n120\n20\n150\n40\n180\n80\n\nIf the price increases from $120 to $180, what would be the price elasticity of supply?\nA 0.16\nB 4\nC 6\nD 60\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nWhat is an example of a non-wage factor?\nA bonus\nB commission\nC fringe benefits\nD overtime rates\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nAn African government has abandoned its own dollar and now uses the US dollar as its currency.\n\nWhy would such a policy have been necessary?\nA Commercial banks restricted their lending.\nB Consumers only used credit cards rather than paper money.\nC Its own dollar no longer acted as a store of value.\nD The central bank controlled the issue of money too tightly.\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: A musician has a choice of playing for an orchestra in either Germany or England.\n\nWhich combination of incomes and cost of living is most likely to cause her to choose the\nGerman orchestra?\n\n\nIncomes and cost of living in Germany compared with those in England\npre-tax (gross) income\nafter-tax (net) income\ncost of living\nA higher\nhigher\nhigher\nB higher\nlower\nlower\nC lower\nhigher\nhigher\nD lower\nhigher\nlower\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: What must result from an increase in output?\nA a decrease in the average cost\nB a decrease in the total costs\nC an increase in the fixed costs\nD an increase in the variable costs\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: What is characteristic of a monopoly market structure?\nA A monopolist may determine the price of its product.\nB A monopolist\u2019s product has many substitutes.\nC There are no external costs.\nD There is easy entry into the market.\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: A firm producing bicycles has the following costs at different levels of output.\n\noutput\ntotal fixed costs\n($)\ntotal variable costs\n($)\n10\n300\n800\n20\n300\n1500\n30\n300\n3300\n\nWhat happens to the average total cost over this range of output?\nA It falls continuously.\nB It falls then rises.\nC It rises continuously.\nD It rises then falls.\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: One aim of government policy is to redistribute income through taxation in order to reduce\ninequality.\n\nWhich policy will achieve this aim?\nA Impose a tax of $0.20 on every dollar earned.\nB Increase the tax-free allowances after which tax must be paid progressively.\nC Introduce a tax on all food.\nD Provide an incentive to earn by reducing taxes for the highest paid.\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: What is an example of expansionary monetary policy?\nA a decrease in income tax rates\nB a decrease in the budget deficit\nC a decrease in the money supply\nD a decrease in the rate of interest\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: Which actions would be likely to increase government expenditure and reduce revenues from\ntaxation?\n\n\ngovernment expenditure\ntax revenues\nA improve health facilities for the elderly\nencourage people to reduce their spending\nB increase the amount of the state pension\nincrease VAT (sales tax)\nC provide free bus transport for retired people\nencourage people to work beyond retirement\nD raise the age of retirement\ndecrease bus fares\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: The chart shows the GDP annual growth rate (percentage), 2012\u20132016, for Greece.\n\n2 0\n\u2013 2\n\u2013 4\n\u2013 6\n\u2013 8\n\u201310\n\u201312\ngrowth\nrate %\n2012\n2013\n2014\n2015\n2016\nyear\n\n\nIn which years did Greece experience the longest period of positive economic growth?\nA 2012\u20132013\nB 2013\u20132014\nC 2014\u20132015\nD 2015\u20132016\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: What are the components of the Human Development Index (HDI)?\nA life expectancy at birth, expected years of schooling, GDP\nB life expectancy at birth, expected years of schooling, GDP per head\nC population growth, adult literacy rate, GDP per head\nD population size, expected years of schooling, number of doctors per head\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: Which government policy would reduce economic growth?\nA cutting the rate of corporation tax\nB increasing expenditure on education\nC lowering the rate of income tax\nD raising interest rates\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: What is a typical characteristic of a developing country?\nA equal distribution of income and wealth\nB good medical care\nC high gross domestic product per head\nD high reliance on natural resources\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: In Botswana, better healthcare has meant that birth rates have been falling faster than death\nrates. Also the number of children born, on average, to each woman has declined from 6.4 to 3.2.\n\nWhat may be concluded from this information?\nA Government spending on education will need to increase.\nB Medical improvements have resulted in falling infant mortality rates.\nC There will be a decline in income for each person working.\nD There will, in the long run, be an increase in the working population.\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: What would cause a favourable change in the Kenyan trade in services (invisible) account?\nA A Kenyan company wins a contract to transport exports from Uganda.\nB A Kenyan tea company increases its exports.\nC A Kenyan trade delegation promoting coffee sales visits India.\nD A Zambian company increases its exports to Kenya.\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: Protectionist policies reduce the level of global economic growth.\n\nWhat is a possible reason for this?\nA Incomes earned from trading decline.\nB Tariffs encourage trade.\nC The average cost of production decreases.\nD The production possibility of an economy expands.\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: What would reduce the volume of international trade in the world economy?\nA a German bank making a loan to a Nigerian company\nB a Japanese car manufacturer establishing a factory in the Czech Republic\nC the Canadian government introducing quotas on Malaysian electronics products\nD the Swedish government granting aid to Somalia\n\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nWhich statement about factors of production is correct?\nA Capital is the amount of money borrowed from a bank.\nB Labour is output made by an employee.\nC Land includes commercially grown rice crops.\nD Profit is the reward for enterprise.\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nSam wrote a list of how he would prefer to spend his Saturday afternoon.\n\nfirst choice\ngo to a cricket match\nsecond choice\nwatch the annual town parade\nthird choice\ngo to the cinema\nfourth choice\nvisit relatives\n\nUnfortunately a thunderstorm caused the cricket match and the town parade to be cancelled.\nSam went to the cinema.\n\nWhat was the opportunity cost of going to the cinema?\nA going to a cricket match\nB watching the annual town parade\nC visiting relatives\nD losing his Saturday free time\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nWhich pair of economic institutions can be found in a market economy?\nA local government and charities\nB monopolies and commercial banks\nC nationalised industries and partnerships\nD stock exchange and public corporations\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nWhat suggests that there is market failure?\nA high producer profits\nB high retail prices\nC lack of competition\nD low levels of investment\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nA railway company increases ticket prices by 10% for travel between 06:00 and 09:00, causing a\nreduction in demand by 2%. After 09:00 it reduces ticket prices by 5%, resulting in a 7% increase\nin demand.\n\nWhat is the price elasticity of demand in response to these price changes?\n\n\nbetween 06:00\nand 09:00\nafter 09:00\nA elastic\nelastic\nB elastic\ninelastic\nC inelastic\nelastic\nD inelastic\ninelastic\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nWhat is a disadvantage of being a specialist skilled worker?\nA Career opportunities are abundant.\nB Earnings are related to the level of skill.\nC It may be difficult to find work locally.\nD Labour supply is elastic and plentiful.\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nWhat is not normally a function of the central bank of a country?\nA acting as lender of last resort\nB issuing notes and coins\nC operating the government\u2019s monetary policy\nD setting the government\u2019s budget\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: A musician has a choice of playing for an orchestra in either Germany or England.\n\nWhich combination of incomes and cost of living is most likely to cause her to choose the\nGerman orchestra?\n\n\nIncomes and cost of living in Germany compared with those in England\npre-tax (gross) income\nafter-tax (net) income\ncost of living\nA higher\nhigher\nhigher\nB higher\nlower\nlower\nC lower\nhigher\nhigher\nD lower\nhigher\nlower\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: Which type of business organisation is necessarily in the public sector of the economy?\nA multinational company\nB public limited company\nC public corporation\nD sole trader\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: Which combination of characteristics correctly describes a monopoly?\n\n\nbarriers to entry\neconomies of scale\nA high\npossible\nB high\nimpossible\nC low\npossible\nD low\nimpossible\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: A firm producing bicycles has the following costs at different levels of output.\n\noutput\ntotal fixed costs\n($)\ntotal variable costs\n($)\n10\n300\n800\n20\n300\n1500\n30\n300\n3300\n\nWhat happens to the average total cost over this range of output?\nA It falls continuously.\nB It falls then rises.\nC It rises continuously.\nD It rises then falls.\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: Why are indirect taxes, such as VAT of 20% on goods and services, described as regressive\nwhen comparing high-income and low-income purchasers?\nA High-income purchasers pay a higher percentage of their income in tax.\nB High-income purchasers pay a lower percentage of their income in tax.\nC Low-income purchasers pay a lower percentage of their income in tax.\nD Low-income purchasers and high-income purchasers pay the same percentage of their\nincome in tax.\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: The government has an important role in mixed economies.\n\nWhich function would it not perform?\nA distributing dividends from profits of state-owned enterprises\nB employing workers to collect taxes\nC investing in transport infrastructure projects\nD producing goods in public corporations\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: Which combination of policy measures would be effective in reducing the effects of a recession?\nA a reduction in interest rates and a reduction in income tax\nB a reduction in interest rates and an increase in income tax\nC an increase in interest rates and a reduction in income tax\nD an increase in interest rates and an increase in income tax\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: How would government spending on education be classified?\n\n\nfiscal\npolicy\nmonetary\npolicy\nsupply-side\npolicy\nA no\nno\nyes\nB no\nyes\nno\nC yes\nno\nyes\nD yes\nyes\nno\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: Which increase is most likely to cause a rise in the output of an economy?\nA hyperinflation\nB income taxes\nC interest rates\nD investment\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: Why was the Human Development Index (HDI) introduced as a measure of the standard of\nliving?\nA Education and healthcare are important contributors to the standard of living.\nB GDP per head only measures development.\nC Inequality can only be measured by HDI.\nD Literacy rates are not an effective measure of the standard of living.\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: During periods of high unemployment across the entire labour force, the highest unemployment\nrate in an economy is often in the 16\u201319 year-old age group.\n\nWhich statement explains why 16\u201319 year-olds may find it difficult to find a job?\nA The incentive to earn an income is lower for that age group.\nB Their wages are lower than those of adults.\nC They lack both work experience and the necessary skills.\nD They prefer leisure activities to long working hours.\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: Venezuela, a leading world oil producer, has experienced hyperinflation of over 400% per annum\nin recent years.\n\nHow does hyperinflation affect an economy?\n\n\nprices\neffect\nA fluctuate up and down\nconsumers are uncertain about future price levels\nB fluctuate up and down\nconsumers can anticipate future price levels\nC rise very rapidly\nvalue of fixed assets remains stable\nD rise very rapidly\nmoney has limited worth as a medium of exchange\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: What is most likely to increase as a country becomes more developed?\nA average household income\nB average size of family\nC infant mortality rate\nD the proportion of income spent on food\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: In Botswana, better healthcare has meant that birth rates have been falling faster than death\nrates. Also the number of children born, on average, to each woman has declined from 6.4 to 3.2.\n\nWhat may be concluded from this information?\nA Government spending on education will need to increase.\nB Medical improvements have resulted in falling infant mortality rates.\nC There will be a decline in income for each person working.\nD There will, in the long run, be an increase in the working population.\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: What would cause a favourable change in the Kenyan trade in services (invisible) account?\nA A Kenyan company wins a contract to transport exports from Uganda.\nB A Kenyan tea company increases its exports.\nC A Kenyan trade delegation promoting coffee sales visits India.\nD A Zambian company increases its exports to Kenya.\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: What is a disadvantage of trade protection of manufactured goods?\nA It can lead to retaliation from trading partners.\nB It encourages infant industries to grow.\nC It increases demand for domestic manufactured goods.\nD It reduces outflows of currencies to pay for imports.\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: What would cause a rise in the deficit on the current account of the balance of payments?\nA a fall in foreign direct investment into the country\nB a fall in interest earned on overseas investment by the country\nC a fall in the value of imported manufactured goods into the country\nD a rise in the revenue earned from tourism in the country\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: What would reduce the volume of international trade in the world economy?\nA a German bank making a loan to a Nigerian company\nB a Japanese car manufacturer establishing a factory in the Czech Republic\nC the Canadian government introducing quotas on Malaysian electronics products\nD the Swedish government granting aid to Somalia\n\n\nBLANK PAGE\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nWhat identifies a finite resource?\nA The resource does not renew itself.\nB The supply of the resource is greater than demand.\nC There is no opportunity cost for the resource.\nD There is unlimited supply of the resource.\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nCountry X provides computers to help teachers in the classroom.\n\nHow would this technology increase the economic potential of country X?\nA It improves the quality of human resources.\nB It reduces the amount of land required for education.\nC It removes the need for teachers.\nD It requires more teachers to do the same work.\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nSam wrote a list of how he would prefer to spend his Saturday afternoon.\n\nfirst choice\ngo to a cricket match\nsecond choice\nwatch the annual town parade\nthird choice\ngo to the cinema\nfourth choice\nvisit relatives\n\nUnfortunately a thunderstorm caused the cricket match and the town parade to be cancelled.\nSam went to the cinema.\n\nWhat was the opportunity cost of going to the cinema?\nA going to a cricket match\nB watching the annual town parade\nC visiting relatives\nD losing his Saturday free time\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nWhich pair of economic institutions can be found in a market economy?\nA local government and charities\nB monopolies and commercial banks\nC nationalised industries and partnerships\nD stock exchange and public corporations\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nIn a private market system certain goods and services would not be available unless the\ngovernment intervened.\n\nWhat does this identify in a private market?\nA market distribution\nB market equilibrium\nC market failure\nD market structure\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nWhat is most likely to increase the occupational mobility of labour?\nA building more houses\nB increased spending on re-training schemes\nC increased total government spending\nD increasing the information on job availability\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nWhich organisations can directly fund the growth of firms?\n\n\ncentral\nbank\ncommercial\nbanks\ngovernment\nA no\nyes\nno\nB no\nyes\nyes\nC yes\nno\nno\nD yes\nno\nyes\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: A musician has a choice of playing for an orchestra in either Germany or England.\n\nWhich combination of incomes and cost of living is most likely to cause her to choose the\nGerman orchestra?\n\n\nIncomes and cost of living in Germany compared with those in England\npre-tax (gross) income\nafter-tax (net) income\ncost of living\nA higher\nhigher\nhigher\nB higher\nlower\nlower\nC lower\nhigher\nhigher\nD lower\nhigher\nlower\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: A public limited company has shares which are\nA freely transferable on the stock exchange.\nB owned by the government.\nC owned only by its workers.\nD restricted in their transferability.\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: In 2015, a large UK company attempted to acquire a rival US medical company to become the\nworld\u2019s leading supplier. Both companies specialised in the manufacture of medicines for treating\nrare diseases.\n\nWhich term would describe the acquisition if it had been successful?\nA backwards vertical integration\nB conglomerate integration\nC forwards vertical integration\nD horizontal integration\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: A firm producing bicycles has the following costs at different levels of output.\n\noutput\ntotal fixed costs\n($)\ntotal variable costs\n($)\n10\n300\n800\n20\n300\n1500\n30\n300\n3300\n\nWhat happens to the average total cost over this range of output?\nA It falls continuously.\nB It falls then rises.\nC It rises continuously.\nD It rises then falls.\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: A government decides to increase tax revenues from consumer expenditure.\n\nWhich tax will it increase?\nA capital gains tax\nB death duties\nC profits tax\nD value added tax\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: A government uses a mixture of fiscal policy measures and supply-side policy measures to\nstimulate growth in the economy.\n\nWhich combination of policy measures will achieve this?\n\n\nfiscal policy measures\nsupply-side policy measures\nA increase government expenditure\nincrease skills training\nB increase government investment\nincrease indirect taxes\nC increase direct taxation\ndecrease unemployment benefit\nD increase interest rates\ndecrease money supply\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: The government uses monetary policy and reduces the interest rate.\n\nWhat might be a consequence of this?\nA a decrease in the rate of inflation\nB an increase in the level of investment\nC an increase in the level of savings\nD an increase in unemployment\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: What is the most likely result of a sustained increase in Gross Domestic Product (GDP)?\nA a decrease in living standards\nB a decrease in the budget surplus\nC an increase in tax revenues\nD an increase in unemployment\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: Which indicator would be included in the Human Development Index (HDI) for a country?\nA adult literacy rate\nB doctors per 1000 people\nC unemployment rate\nD years spent in education\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: Which type of unemployment is the result of a permanent fall in the demand for the products of\nan industry?\nA cyclical\nB frictional\nC seasonal\nD structural\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: Which change, as a percentage of GDP, would be unlikely to be found in a country as it\ndevelops?\nA an increase in average incomes and a decrease in unemployment\nB an increase in manufacturing production and an increase in shipping services\nC an increase in subsistence farming and a decrease in financial services\nD an increase in tourism and a decrease in the export of agricultural products\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: In Botswana, better healthcare has meant that birth rates have been falling faster than death\nrates. Also the number of children born, on average, to each woman has declined from 6.4 to 3.2.\n\nWhat may be concluded from this information?\nA Government spending on education will need to increase.\nB Medical improvements have resulted in falling infant mortality rates.\nC There will be a decline in income for each person working.\nD There will, in the long run, be an increase in the working population.\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: What would cause a favourable change in the Kenyan trade in services (invisible) account?\nA A Kenyan company wins a contract to transport exports from Uganda.\nB A Kenyan tea company increases its exports.\nC A Kenyan trade delegation promoting coffee sales visits India.\nD A Zambian company increases its exports to Kenya.\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: A newspaper headline stated \u2018Free trade helps the world\u2019s poorest\u2019.\n\nWhy might this be correct?\nA Employment will be focused in hi-tech industries.\nB Environmental disasters will be avoided.\nC Free trade reduces competitiveness for domestic firms.\nD The cost of living is likely to go down with free trade.\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: A trade union succeeds in raising the wages in an industry above the current equilibrium wage.\n\nHow would the demand and supply of labour change?\n\n\nchange in quantity\nof labour demanded\nchange in quantity\nof labour supplied\nA fall\nfall\nB fall\nrise\nC rise\nfall\nD rise\nrise\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: What would reduce the volume of international trade in the world economy?\nA a German bank making a loan to a Nigerian company\nB a Japanese car manufacturer establishing a factory in the Czech Republic\nC the Canadian government introducing quotas on Malaysian electronics products\nD the Swedish government granting aid to Somalia\n\n\nBLANK PAGE\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nWhat is the basic economic problem?\nA excess supply of goods and services\nB lack of profits\nC recession\nD scarcity of resources\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nOn which factor of production does innovation directly depend?\nA decisions of entrepreneurs\nB high inputs of capital\nC long hours of manual labour\nD plentiful supplies of land\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nWhich person makes macroeconomic decisions?\nA a bank manager\nB a government finance minister\nC a shareholder in a firm\nD a worker\n\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nWhat is a function of the price mechanism?\nA to allocate goods and services\nB to calculate national expenditure\nC to ensure an equal distribution of income\nD to guide government policy decisions\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nThe price elasticity of supply of a good is 2. The price of the good then falls by 10%.\n\nWhat is the effect on quantity supplied?\nA It falls by 0.2%.\nB It falls by 20%.\nC It increases by 0.2%.\nD It increases by 20%.\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nA German car manufacturer builds a factory in India. A group of Indian workers at the factory join\na trade union.\n\nWhat would this trade union be expected to do for the workers?\nA Encourage the workers to bargain individually with the employer.\nB Negotiate with the German government on tariff reductions for Indian-produced cars.\nC Promote an advertising campaign to sell more Indian cars.\nD Protect the workers against unfair dismissal by the employer.\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nWhy do women, on average, earn less than men?\nA Women may be less able than men.\nB Women are not eligible for government jobs.\nC Women may not work as hard as men.\nD Women often face discrimination in the workplace.\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: When is it most likely that the demand for labour in an industry increases?\nA When the demand for the industry\u2019s product increases.\nB When the level of immigration into the country increases.\nC When the level of qualifications needed to work in the industry decreases.\nD When the level of wages paid in the industry increases.\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: What could cause internal diseconomies of scale for a firm?\nA a fall in demand for the products produced by the firm\nB a merger with another firm that results in slower decision-making\nC spending more on research and development to create new products\nD the lack of skilled labour in the geographical area where the firm is based\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: What are two aims that a government normally pursues when managing the performance of the\nwhole economy?\nA to encourage an increase in production and to prevent high inflation\nB to ensure no one is unemployed and to reduce exports\nC to give everyone equal incomes and to increase government revenue\nD to protect the environment and to reduce interest rates\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: What is most likely to be the responsibility of a central government?\nA the provision of immigration officials at an airport\nB the provision of security cameras in a shopping centre\nC the provision of security staff at a bank\nD the provision of ticket inspectors on a train\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: Which measure would indicate that an expansionary fiscal policy is being used by the\ngovernment?\nA cuts in government spending\nB higher interest rates\nC lower interest rates\nD lower taxes\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: Some governments in the European Union are trying to reduce unemployment.\n\nWhat should increase to achieve this?\nA imports of goods\nB interest rates\nC public sector spending\nD taxation of firms\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: In 2016, Romania had an increase in its real gross domestic product of 4.8%.\n\nWhat must this mean about the Romanian economy?\nA Living standards increased by 4.8%.\nB Total consumer income increased by 4.8%.\nC Total output of all goods and services adjusted for inflation increased by 4.8%.\nD Total output of manufactured goods adjusted for inflation increased by 4.8%.\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: An economy is experiencing rising prices.\n\nWhich government policy will help reduce consumer expenditure?\nA introducing compulsory saving for income earners\nB investing more in building infrastructure\nC issuing more banknotes and coins\nD reducing indirect taxes\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: Some goods take a greater percentage of a typical household\u2019s total spending than others.\nHow is this accounted for in the construction of a consumer prices index?\nA by deducting the goods\nB by giving a weight to the goods\nC by taking an average of price fluctuations during a year\nD by using the price elasticity of demand for the goods\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: A low-income country experiences extreme poverty in its rural areas.\n\nWhat is a possible cause of this?\nA development of better irrigation techniques\nB distribution of international food aid\nC high trade barriers imposed by high-income countries\nD higher prices for agricultural produce\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: Which factor in the world\u2019s low-income countries limits their economic development?\n\nA balance of payments surpluses\nB high saving ratios\nC large inflows of foreign investment\nD rapid population growth\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: A government is faced with an unwanted deficit on the current account of its balance of\npayments.\n\nWhich action is most likely to reduce the deficit?\nA raising government spending on welfare benefits\nB reducing income tax\nC restricting imports by raising tariffs\nD revaluing its currency\n\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: What is meant by a depreciation in the foreign exchange rate?\nA The government intervenes to reduce the exchange rate of the country\u2019s currency.\nB The rate of exchange of exports for imports for a country deteriorates.\nC The rate of inflation in a country continues to rise.\nD The value of a country\u2019s currency falls on the international exchange market.\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nWhat causes economic agents to make choices?\nA limited needs and wants\nB the existence of finite resources\nC the existence of free goods\nD the market mechanism\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nWhich combination of a factor of production and its factor income is not correct?\n\n\nfactor of\nproduction\nfactor income\nA capital\ninterest\nB enterprise\nprofit\nC labour\ndividends\nD land\nrent\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nWhat is an example of a macroeconomic aim?\nA to create and maintain full employment\nB to improve efficiency in the manufacturing sector of the economy\nC to provide consumers with greater information when buying goods and services\nD to encourage greater occupational mobility of labour\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nWhy might a market economy fail to achieve the best use of scarce resources?\nA Consumers may lack information about which good to buy.\nB Demerit goods are underconsumed.\nC Public goods are overconsumed.\nD Most resources are owned by the government.\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nWhich task is not a function of a trade union?\nA agreeing the minimum number to be employed on a particular job\nB deciding on the level of a national minimum wage\nC negotiating working hours and conditions of work\nD providing legal advice on unfair dismissal\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nWhat does not have an effect on wages in a free market economy?\nA danger levels in the workplace\nB government regulations\nC the number of people willing and able to work\nD the years of training required\n\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: Firm X supplies bricks and decides to merge with firm Y that also supplies bricks.\n\nWhich form of merger has taken place?\nA backward vertical\nB conglomerate\nC forward vertical\nD horizontal\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: Who owns a public sector organisation?\nA individuals\nB shareholders\nC specialist managers\nD the government\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: What are two aims that a government normally pursues when managing the performance of the\nwhole economy?\nA to encourage an increase in production and to prevent high inflation\nB to ensure no one is unemployed and to reduce exports\nC to give everyone equal incomes and to increase government revenue\nD to protect the environment and to reduce interest rates\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: What is most likely to be the responsibility of a central government?\nA the provision of immigration officials at an airport\nB the provision of security cameras in a shopping centre\nC the provision of security staff at a bank\nD the provision of ticket inspectors on a train\n\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: The government wants to reduce the consumption of cigarettes.\n\nWhich policy would be most likely to do this?\nA increasing a subsidy on cigarettes\nB increasing income tax\nC increasing interest rates\nD increasing the indirect tax on cigarettes\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: Which group should not be included in the measurement of unemployment?\nA redundant unskilled workers seeking alternative work\nB seasonal agricultural workers in out-of-season periods\nC students over 18 years continuing with full-time education\nD those who have left school and cannot get a job\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: An economy is experiencing rising prices.\n\nWhich government policy will help reduce consumer expenditure?\nA introducing compulsory saving for income earners\nB investing more in building infrastructure\nC issuing more banknotes and coins\nD reducing indirect taxes\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: Some goods take a greater percentage of a typical household\u2019s total spending than others.\nHow is this accounted for in the construction of a consumer prices index?\nA by deducting the goods\nB by giving a weight to the goods\nC by taking an average of price fluctuations during a year\nD by using the price elasticity of demand for the goods\n\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: In countries with absolute poverty, low incomes can start a process that keeps incomes low.\n\nWhat are the stages of this process?\nA low incomes \uf0ae low consumption \uf020\uf0ae low prices \uf0ae low output \uf0ae low incomes\nB low incomes \uf0ae low government spending \uf0ae high taxation \uf0ae low employment \uf0ae low\nincomes\nC low incomes \uf0ae low investment \uf0ae high profits \uf0ae low dividends \uf0ae low incomes\nD low incomes \uf0ae low saving \uf0ae low investment \uf0ae low productivity \uf0ae low incomes\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: Which factor in the world\u2019s low-income countries limits their economic development?\n\nA balance of payments surpluses\nB high saving ratios\nC large inflows of foreign investment\nD rapid population growth\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: What causes the birth rate to fall in a country?\nA Fewer women work.\nB Infant mortality rates rise.\nC Medical supplies and healthcare improve.\nD The optimum population increases.\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: A country wishes to increase a current account surplus on the balance of payments.\n\nWhich action would it take?\nA abolish an import quota\nB increase import tariffs\nC remove export subsidies\nD tax export producers\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nWhy do consumers have to make choices when spending their income?\nA Advertising encourages consumer spending.\nB Consumers have unlimited incomes.\nC Consumer wants cannot all be satisfied with their income.\nD Not all products will be attractive to consumers.\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nWhat is the key role of an entrepreneur?\nA inventor\nB risk taker\nC shareholder\nD worker\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nEconomics is divided into two: microeconomics and macroeconomics.\n\nstatement 1\nWhen the price of oil falls there is an expansion in demand.\n\nstatement 2\nThe Organization of the Petroleum Exporting Countries (OPEC) can\ninfluence the price of oil.\n\nWhich combination correctly describes these two statements?\n\n\nstatement 1\nstatement 2\nA macroeconomic statement\nmacroeconomic statement\nB macroeconomic statement\nmicroeconomic statement\nC microeconomic statement\nmacroeconomic statement\nD microeconomic statement\nmicroeconomic statement\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nWhat is a disadvantage of a market economic system?\nA Entrepreneurs lack incentives to produce what consumers want.\nB Government intervention will reduce the efficiency of firms.\nC Market dominance by firms can lead to higher prices.\nD There is underproduction of demerit goods.\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nIn which occupation would wages tend to increase?\nA in those where a worker is paid weekly\nB in those where a worker needs less training\nC in those where there is an excess demand for labour\nD in those where work becomes less dangerous\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nWhich row shows a characteristic of money and a function of money?\n\n\ncharacteristic\nfunction\nA acceptability\nmedium of exchange\nB cash\nmeasure of value\nC divisibility\nportability\nD store of value\nbank deposit\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: Which combination is usually found in a monopoly?\nA many buyers and many sellers\nB many buyers and single seller\nC single buyer and many sellers\nD single buyer and single seller\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: What is usually considered to be an advantage to a firm of using division of labour?\nA high labour turnover\nB increased mechanisation\nC movement of labour between tasks\nD need for quality control\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: What are two aims that a government normally pursues when managing the performance of the\nwhole economy?\nA to encourage an increase in production and to prevent high inflation\nB to ensure no one is unemployed and to reduce exports\nC to give everyone equal incomes and to increase government revenue\nD to protect the environment and to reduce interest rates\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: What is most likely to be the responsibility of a central government?\nA the provision of immigration officials at an airport\nB the provision of security cameras in a shopping centre\nC the provision of security staff at a bank\nD the provision of ticket inspectors on a train\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: A government decreased the tax on all goods produced in its country.\n\nWhat is the most likely consequence of this?\nA a decrease in exports\nB an increase in imports\nC an increase in production\nD a worsening of the balance of trade in goods\n\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: Which government policy measure would cause an increase in a country\u2019s supply of labour?\nA increasing unemployment benefits\nB lowering interest rates\nC raising income tax\nD raising the age of retirement\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: Due to a rise in the number of retired people, there has been increased demand for some\ngovernment expenditure.\n\nWhich type of government expenditure is most likely to be directly affected?\nA defence\nB health services\nC re-training grants\nD street lighting\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: An economy is experiencing rising prices.\n\nWhich government policy will help reduce consumer expenditure?\nA introducing compulsory saving for income earners\nB investing more in building infrastructure\nC issuing more banknotes and coins\nD reducing indirect taxes\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: Some goods take a greater percentage of a typical household\u2019s total spending than others.\nHow is this accounted for in the construction of a consumer prices index?\nA by deducting the goods\nB by giving a weight to the goods\nC by taking an average of price fluctuations during a year\nD by using the price elasticity of demand for the goods\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: One of the indicators of living standards is the Human Development Index (HDI).\n\nWhat is not taken into consideration when calculating the HDI?\nA education\nB income per head\nC level of savings\nD life expectancy\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: Which factor in the world\u2019s low-income countries limits their economic development?\n\nA balance of payments surpluses\nB high saving ratios\nC large inflows of foreign investment\nD rapid population growth\n\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: What would not be included in the current account of the balance of payments?\nA dividends earned from a firm in another country\nB imports of TVs from another country\nC purchase of a house in another country\nD rents paid to owners of land in another country\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: What is most likely to discourage international specialisation and trade for an economy?\nA decreasing labour supply\nB decreasing transport costs\nC increasing oil prices\nD increasing trade barriers\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: Many low-income countries rely on multinational companies (MNCs) to provide economic\ndevelopment.\n\nWhat is a disadvantage of this for the low-income country?\nA Local firms close because MNCs are more efficient.\nB New production techniques are introduced.\nC The balance of payments may improve.\nD The MNCs have to pay taxes on their profits.\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nTo help reduce the price of oil, new supplies are needed. However, objectors oppose exploration\nof new sites because of the environmental damage it may cause.\n\nWhy is this statement an example of the basic economic problem?\nA Oil is a limited resource.\nB Oil is expensive.\nC The exploration involves demand and supply.\nD There are external costs involved in production.\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \n0 0\n3 6\n9 12\n15\nentertainment\n(hours)\nrevision\n(hours)\n\n\nThe student revises for 3 hours a day. As exams approach, the student decides to revise for 9\nhours a day.\n\nWhat is the opportunity cost of this decision?\nA 3 hours of revision\nB 6 hours of entertainment\nC 6 hours of revision\nD 9 hours of entertainment\n\n\n\n3 Helium is a gas that is limited in supply because it takes thousands of years to form. The US\ngovernment holds 35% of the world\u2019s supply of helium and has been selling its stocks. Helium is\nessential in medical scanners. It is also used for party balloons, which is a wasteful alternative\nuse of a valuable good.\n\nWhich two concepts apply to this statement?\nA demand and supply, government subsidy\nB excess demand, resource allocation\nC opportunity cost, private monopoly\nD public sector, factors of production\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nWhen is production certain to harm society?\nA when the private costs are greater than the private benefits\nB when the production results in externalities\nC when the social costs are greater than the private costs\nD when the social costs are greater than the social benefits\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nWhat is the role of the price mechanism in a market economy?\nA to allocate scarce resources\nB to increase the provision of merit goods\nC to make the distribution of goods and services more equal\nD to reduce the negative externalities of production and consumption\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nWhat is a macroeconomic concept?\nA the effect of a price change of a good\nB the equilibrium price in the market for a good\nC the reason for a change in a firm\u2019s behaviour\nD the total spending in an economy\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nThe price elasticity of demand (PED) for bottled water is \u2013 0.9.\n\nWhat will happen to the quantity demanded for bottled water if its price increases by 10%?\nA decrease by 0.9%\nB decrease by 9%\nC increase by 0.9%\nD increase by 9%\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nWhat will increase the demand for labour in an industry?\nA a decrease in labour productivity in that industry\nB a decrease in the demand for the good made in that industry\nC an increase in labour productivity in that industry\nD an increase in wages in that industry\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: Which government policies will both reduce the difference in income between low-paid and high-\npaid workers?\nA a decrease in the maximum wage and a more regressive income tax system\nB a decrease in the maximum wage and a reduction in trade union power\nC an increase in the minimum wage and a more progressive income tax system\nD an increase in the minimum wage and a more regressive income tax system\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: Wages for nurses decrease, while working hours for pilots decrease.\n\nAssuming other factors do not change, what is the likely effect on the number of individuals\nchoosing to become nurses or pilots?\n\n\nnurses\npilots\nA decrease\ndecrease\nB decrease\nincrease\nC increase\ndecrease\nD increase\nincrease\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: For some months the price of petrol (gas) decreased significantly.\n\nHow would this affect a delivery firm that delivers goods for other firms using petrol (gas)\npowered vehicles?\nA Average fixed costs would decrease.\nB Profits would decrease.\nC Total fixed costs would decrease.\nD Variable costs would decrease.\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: The size of the domestic car industry in Japan has enabled Japanese car producers to be more\nprice competitive than rival car producers.\n\nWhat is an explanation for this?\nA Economies of scale are present in the Japanese car industry.\nB Managerial problems exist in the Japanese car industry.\nC Productivity is low in Japan.\nD The Japanese car industry is very labour-intensive.\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: What is a major advantage of a horizontal merger compared with a conglomerate merger?\nA It causes more motivation of the workforce.\nB It gains financial economies of scale with cheaper borrowing from banks.\nC It leads to a diversification making the firm less vulnerable.\nD It reduces competition and increases the merged firm\u2019s market share.\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: Recession is when there are two consecutive quarters (six months) of\nA deflation.\nB falling GDP.\nC rising prices.\nD rising unemployment.\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: An economy is operating with all resources fully employed.\n\nWhich would be an outcome of a significant increase in government expenditure?\nA deflation\nB demand-pull inflation\nC falling output\nD increased employment\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: What causes economic growth?\nA availability of more resources\nB higher imports of consumer goods\nC higher unemployment\nD lower investment\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: 0\ninheritance tax\n50\nsales tax (VAT)\n300\n\nWhat is the total amount of revenue raised by indirect taxes?\nA $300 m\nB $350 m\nC $385 m\nD $435 m\n\n\n20 Which statement about supply-side policy is correct?\nA It aims to increase the productive potential of the economy.\nB It aims to increase total demand in the economy.\nC It involves changes in the equilibrium foreign exchange rate.\nD It involves changes in the rate of interest.\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: Why is weighting used in the Consumer Prices Index (CPI)?\nA to ensure that all items in the index are treated equally\nB to ensure that all price changes are included in the index\nC to ensure that the index includes changes in the quantity consumed\nD to ensure that the index reflects the spending patterns of consumers\n\n\n\nDue to an issue with Question 22, the question has been removed from the question paper.\n\n\n23 Which combination of policy measures is most likely to increase the level of employment?\nA decrease general taxation and decrease the rate of interest\nB decrease general taxation and increase the rate of interest\nC increase general taxation and decrease the rate of interest\nD increase general taxation and increase the rate of interest\n\n\n24 What is a certain cause of absolute poverty?\nA growing old\nB insufficient income for basic needs\nC lack of good healthcare\nD many dependants in the family\n\n\n25 The birth rate in a country is higher than the death rate.\n\nWhat might prevent the country\u2019s population from rising?\nA Emigration is greater than immigration.\nB The birth rate is falling.\nC The country\u2019s medical care improves.\nD The death rate is rising.\n\n\n\n26 The table shows statistics for four countries, A\u2013D.\n\nWhich country has the lowest standard of living?\n\n\naverage annual\ngrowth rate of\npopulation\n(%)\npopulation density\n(per square kilometre)\nlife expectancy\n(years)\nreal GDP per head\n($)\nA 1.9\n19\n46\n190\nB 2.7\n2 58\n1700\nC 3.7\n45\n59\n210\nD 4.2\n89\n44\n190\n\n\n27 Why can specialisation cause economic growth?\nA Specialisation can allow a country to produce many different goods and services.\nB Specialisation can lead to a reduction in average costs of production.\nC Specialisation can mean that firms in a country will face diseconomies of scale.\nD Specialisation can reduce a country\u2019s need to depend on other economies.\n\n\n28 The diagram shows China\u2019s trade with Brazil for two years.\n\n0 1\n2 3\n4 5\nChina\u2019s exports\nChina\u2019s imports\nyear 1\nyear 2\nkey\n$ billion\n\n\nWhat happened to China\u2019s trade balance with Brazil between year 1 and year 2?\nA It experienced a falling surplus.\nB It experienced a rising deficit.\nC It moved from deficit to surplus.\nD It moved from surplus to deficit.\n\n\n29 Why do some governments limit the operations of multinational companies (MNCs) within their\ndomestic economy?\nA MNCs contribute to technological advances.\nB MNCs decrease a country\u2019s unemployment rate.\nC MNCs gain profits which are transferred out of the country.\nD MNCs increase a country\u2019s current account surplus.\n\n\n30 What is an immediate effect for a country of a fall in its foreign exchange rate?\nA a fall in the money supply\nB an increase in purchasing power\nC cheaper imports\nD more competitive exports\n\n\n\nBLANK PAGE\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nTo help reduce the price of oil, new supplies are needed. However, objectors oppose exploration\nof new sites because of the environmental damage it may cause.\n\nWhy is this statement an example of the basic economic problem?\nA Oil is a limited resource.\nB Oil is expensive.\nC The exploration involves demand and supply.\nD There are external costs involved in production.\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nWhat is an opportunity cost for a consumer spending money on a holiday?\nA the potential interest earned if the holiday money had been saved\nB the price paid for an air ticket to the holiday destination\nC the rubbish created during the holiday which affects the local community\nD the satisfaction that the consumer gains from the holiday\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nHelium is a gas that is limited in supply because it takes thousands of years to form. The US\ngovernment holds 35% of the world\u2019s supply of helium and has been selling its stocks. Helium is\nessential in medical scanners. It is also used for party balloons, which is a wasteful alternative\nuse of a valuable good.\n\nWhich two concepts apply to this statement?\nA demand and supply, government subsidy\nB excess demand, resource allocation\nC opportunity cost, private monopoly\nD public sector, factors of production\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nWhich combination of characteristics describes a public good?\nA excludable and non-rival in consumption\nB excludable and rival in consumption\nC non-excludable and non-rival in consumption\nD non-excludable and rival in consumption\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nWhat is an advantage of a market economy?\nA Equilibrium market price clears the market.\nB Producers and consumers have the same aims.\nC The government has no need to intervene in markets.\nD The lowest price possible is always charged.\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nWhat is a macroeconomic aim of a government?\nA balance of payments stability\nB deflation\nC income inequality\nD unemployment\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \n\nFor which fall in price is the demand price-inelastic?\nA from $6 to $5\nB from $5 to $4\nC from $4 to $3\nD from $3 to $2\n\n\n9 Which government policy will increase productivity?\nA decreasing the number of training programmes\nB encouraging labour-intensive production\nC promoting good industrial relations\nD reducing private sector investment\n\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: Which result of increased specialisation in a firm is an advantage for the firm, but a disadvantage\nfor some of the workers in the firm?\nA greater mechanisation\nB higher labour productivity\nC higher skill levels\nD longer training times\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: Two car manufacturers agree to merge.\n\nWhich outcome would be a disadvantage for customers?\nA increased capital for research and development\nB lower average costs through economies of scale\nC reduced range of vehicles produced\nD use of a wider range of marketing information\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: An economy recorded a second month of deflation.\n\nWhat does this mean?\nA It was facing a recession.\nB Price levels were falling.\nC Total demand was rising.\nD Unemployment was falling.\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: What is a cause of demand-pull inflation?\nA a surplus of skilled labour\nB higher government expenditure\nC higher tax rates\nD lower net exports\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: What is the consequence of economic growth for individuals and for the economy?\n\n\nindividuals\nthe economy\nA increase in absolute poverty\nincrease in inflation\nB increase in average incomes\nincrease in government tax revenue\nC increase in the variety of goods and services\nreduction in exports\nD increase in unemployment\nreduction in the standard of living\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: 0\ninheritance tax\n50\nsales tax (VAT)\n300\n\nWhat is the total amount of revenue raised by indirect taxes?\nA $300 m\nB $350 m\nC $385 m\nD $435 m\n\n\n20 Which supply-side policy measure would help to match the skills of workers to job vacancies?\nA encouraging the modernisation of factories\nB offering retraining to unemployed workers\nC reducing taxes to provide incentives to work\nD replacing government enterprises with private enterprises\n\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: How is the rate of inflation measured?\nA by calculating the change in the price of goods and services from one year to the next\nB by calculating the real value of all output of goods and services in an economy\nC by calculating the total number of people willing and able to work but cannot find work\nD by calculating the total value of exports minus the total value of imports\n\n\n\nDue to an issue with Question 22, the question has been removed from the question paper.\n\n\n23 Which combination of policy measures is most likely to increase the level of employment?\nA decrease general taxation and decrease the rate of interest\nB decrease general taxation and increase the rate of interest\nC increase general taxation and decrease the rate of interest\nD increase general taxation and increase the rate of interest\n\n\n24 Poverty in households may be defined in relative terms.\n\nWhat indicates relative poverty?\nA falling below society\u2019s expected standard of living\nB income level required to meet basic needs\nC lack of access to clean water\nD living on less than $2 a day\n\n\n25 What is the effect on an economy of net emigration of people aged 20\u201340?\nA a more mobile labour force\nB an ageing population\nC higher government tax revenue\nD rising house prices\n\n\n26 The table shows statistics for four countries, A\u2013D.\n\nWhich country has the lowest standard of living?\n\n\naverage annual\ngrowth rate of\npopulation\n(%)\npopulation density\n(per square kilometre)\nlife expectancy\n(years)\nreal GDP per head\n($)\nA 1.9\n19\n46\n190\nB 2.7\n2 58\n1700\nC 3.7\n45\n59\n210\nD 4.2\n89\n44\n190\n\n\n27 A country specialises in the production of steel, toys and textiles.\n\nWhat is a disadvantage of specialisation for the country\u2019s workers?\nA They cannot afford to buy products from other countries.\nB They could become structurally unemployed if global demand changes.\nC They have to learn a variety of skills.\nD They have too much choice which wastes their time.\n\n\n28 The diagram shows China\u2019s trade with Brazil for two years.\n\n0 1\n2 3\n4 5\nChina\u2019s exports\nChina\u2019s imports\nyear 1\nyear 2\nkey\n$ billion\n\n\nWhat happened to China\u2019s trade balance with Brazil between year 1 and year 2?\nA It experienced a falling surplus.\nB It experienced a rising deficit.\nC It moved from deficit to surplus.\nD It moved from surplus to deficit.\n\n\n\n29 The US imposed tariffs on cars and motorcycles from Germany.\n\nWhat is the effect of these tariffs?\nA decrease in inflation in the US\nB decrease in trade between the US and Germany\nC increase in profits of car and motorcycle producers from Germany\nD increase in standards of living in the US and in Germany\n\n\n30 What is an immediate effect for a country of a fall in its foreign exchange rate?\nA a fall in the money supply\nB an increase in purchasing power\nC cheaper imports\nD more competitive exports\n\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nTo help reduce the price of oil, new supplies are needed. However, objectors oppose exploration\nof new sites because of the environmental damage it may cause.\n\nWhy is this statement an example of the basic economic problem?\nA Oil is a limited resource.\nB Oil is expensive.\nC The exploration involves demand and supply.\nD There are external costs involved in production.\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nHelium is a gas that is limited in supply because it takes thousands of years to form. The US\ngovernment holds 35% of the world\u2019s supply of helium and has been selling its stocks. Helium is\nessential in medical scanners. It is also used for party balloons, which is a wasteful alternative\nuse of a valuable good.\n\nWhich two concepts apply to this statement?\nA demand and supply, government subsidy\nB excess demand, resource allocation\nC opportunity cost, private monopoly\nD public sector, factors of production\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nWhat is an example of a public good?\nA healthcare\nB street lights\nC unemployment benefits\nD vaccinations\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nWhy does a government provide certain goods and services in a mixed economic system?\nA The government always provides goods more cheaply than private firms.\nB The government considers only private costs and benefits.\nC The government provides goods to prevent the development of monopolies.\nD The government provides public goods because private firms cannot charge for them.\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nWhat is a microeconomic decision?\nA a central bank reducing interest rates\nB a gas firm reducing its prices\nC a government increasing income tax\nD a government increasing the national minimum wage\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \n40\nB 40\n640\nC 50\n750\nD 100\n500\n\n\n10 What is an advantage of labour-intensive production and what is an advantage of\ncapital-intensive production?\n\n\nlabour-intensive\ncapital-intensive\nA each item can be individually made\naverage costs of production are low\nB keeps unemployment down\nfixed costs are high\nC workers have pride in the product\nmachinery may break down\nD workers have to work hard\nthere is a ready market for the product\n\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: The market equilibrium wage rate is $10 per hour.\n\nWhat explains why the wage rate actually paid is $12 per hour?\nA Employers are competing for labour.\nB The government sets a minimum wage of $12 per hour.\nC There is a surplus of skilled labour.\nD Workers have received unpaid training.\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: A firm imports 20 high quality bicycles into the US at a cost of $3000 each. It sells them all,\nmaking a profit of $1000 per bicycle.\n\nWhat is the firm\u2019s average revenue?\nA $1000\nB $2000\nC $3000\nD $4000\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: A clothing manufacturer expands by taking over a clothing retailer.\n\nWhich type of merger is this?\nA backward vertical\nB conglomerate\nC forward vertical\nD horizontal\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: Which economic situation exists when there are two consecutive quarters (six months) of\nnegative economic growth?\nA budget surplus\nB current account deficit\nC inflation\nD recession\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: Why might measures to reduce unemployment also make inflation rise?\nA They encourage cheap imports.\nB They increase demand.\nC They reduce firms\u2019 costs.\nD They require wages to fall.\n\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: Which change affecting an economy\u2019s labour market promotes economic growth?\nA increasing trade union strike action\nB lowering the age of retirement\nC reducing training of workers\nD removing immigration controls\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: 0\ninheritance tax\n50\nsales tax (VAT)\n300\n\nWhat is the total amount of revenue raised by indirect taxes?\nA $300 m\nB $350 m\nC $385 m\nD $435 m\n\n\n20 Which statement relating to supply-side policies is correct?\nA They aim to increase aggregate demand.\nB They aim to increase the long-run capacity of the economy.\nC They aim to reduce cyclical unemployment.\nD They aim to work in the short term.\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: What is always indicated by an increase in the Consumer Prices Index (CPI)?\nA an increase in consumer spending in an economy\nB an increase in living standards\nC an increase in the average cost of living\nD an increase in the purchasing power of money\n\n\n\nDue to an issue with Question 22, the question has been removed from the question paper.\n\n23 Which combination of policy measures is most likely to increase the level of employment?\nA decrease general taxation and decrease the rate of interest\nB decrease general taxation and increase the rate of interest\nC increase general taxation and decrease the rate of interest\nD increase general taxation and increase the rate of interest\n\n\n24 What could reduce poverty?\nA greater economic growth\nB less spending on education\nC more regressive taxation\nD privatisation of hospitals\n\n\n25 The table shows information about four countries, A\u2013D.\n\nWhich country is most likely to have a falling population?\n\n\naccess to a\nhealthy diet\ncost of bringing\nup children\nA falling\nfalling\nB falling\nrising\nC rising\nfalling\nD rising\nrising\n\n\n\n26 The table shows statistics for four countries, A\u2013D.\n\nWhich country has the lowest standard of living?\n\n\naverage annual\ngrowth rate of\npopulation\n(%)\npopulation density\n(per square kilometre)\nlife expectancy\n(years)\nreal GDP per head\n($)\nA 1.9\n19\n46\n190\nB 2.7\n2 58\n1700\nC 3.7\n45\n59\n210\nD 4.2\n89\n44\n190\n\n\n27 Malaysia and Indonesia specialise in the production of palm oil.\n\nWhat is a disadvantage of specialisation?\nA concentration of labour in the activity in which it is most productive\nB creation of jobs to meet world demand\nC reliance on trade with other countries for other goods\nD rising palm oil prices\n\n\n28 The diagram shows China\u2019s trade with Brazil for two years.\n\n0 1\n2 3\n4 5\nChina\u2019s exports\nChina\u2019s imports\nyear 1\nyear 2\nkey\n$ billion\n\n\nWhat happened to China\u2019s trade balance with Brazil between year 1 and year 2?\nA It experienced a falling surplus.\nB It experienced a rising deficit.\nC It moved from deficit to surplus.\nD It moved from surplus to deficit.\n\n\n29 What is a reason for trade protection?\nA to reduce a deficit on the current account of the balance of payments\nB to reduce a surplus on the current account of the balance of payments\nC to reduce economic growth\nD to reduce inflation\n\n\n30 What is an immediate effect for a country of a fall in its foreign exchange rate?\nA a fall in the money supply\nB an increase in purchasing power\nC cheaper imports\nD more competitive exports\n\n\n\nBLANK PAGE\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nThe Chinese government is concerned about the level of poverty and the need for more\nresources in low-income regions of the country. As a result, it is increasing its expenditure in\nthose regions and reducing it in high-income regions.\n\nWhich economic concept does this government policy illustrate?\nA diseconomies of scale\nB market forces\nC opportunity cost\nD specialisation\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nAn airline needs people and equipment. These can be divided into factors of production.\n\nWhat is allocated to its correct factor of production?\n\n\npeople or equipment\nfactor of production\nA aircraft\ncapital\nB airline owners\nlabour\nC computer network\nland\nD pilots\nenterprise\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nWhat is the significance to firms of price elasticity of demand?\nA It allows firms to measure the effect of a change in the price of their competitors.\nB It allows firms to measure their ability to change production due to a change in price.\nC It allows firms to predict the change in costs of production.\nD It allows firms to predict the effect of a change in price on their total revenue.\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nIn a free market, market failure causes a misallocation of resources.\n\nWhat is not an example of market failure?\nA external costs of production\nB internal diseconomies of scale\nC over-consumption of demerit goods\nD under-consumption of merit goods\n\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nWhich organisations can directly fund the growth of firms?\n\n\ncentral\nbanks\ncommercial\nbanks\ngovernments\nA no\nyes\nno\nB no\nyes\nyes\nC yes\nno\nno\nD yes\nno\nyes\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: Which statement about different income groups is correct?\nA High-income groups do not need to borrow money.\nB High-income groups save less money than low-income groups.\nC Low-income groups find it easier to borrow than high-income groups.\nD Low-income groups save a smaller percentage of their income than high-income groups.\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: A musician has a choice of playing for an orchestra in either Germany or England.\n\nWhich combination of incomes and cost of living is most likely to cause her to choose the\nGerman orchestra?\n\n\nincomes and cost of living in Germany compared with those in England\npre-tax (gross) income\nafter-tax (net) income\ncost of living\nA higher\nhigher\nhigher\nB higher\nlower\nlower\nC lower\nhigher\nhigher\nD lower\nhigher\nlower\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: A firm sells 50 units at a price of $3 per product.\n\nWhat is the firm\u2019s total revenue and average revenue?\n\n\ntotal revenue\n$ average revenue\n$ A\n50\n3 B\n50\n50\nC 150\n3 D\n150\n50\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: Two large-scale firms involved in chemical manufacturing wish to merge.\n\nWhy might the government decide to prevent the merger?\nA It enables greater economies of scale to operate.\nB It increases productivity per worker employed.\nC It reduces competition in the industry.\nD It results in higher wages paid to labour.\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: What is included in a government budget calculation?\nA export revenue\nB external costs\nC indirect tax revenue\nD opportunity cost\n\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: Which change is an example of monetary policy?\nA a depreciation of the foreign exchange rate\nB a reduction of unemployment benefits\nC an increased import tax\nD the introduction of import quotas\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: What is the most likely effect of increasing the rate of interest?\nA Investment increases.\nB The cost of government borrowing falls.\nC The exchange rate falls.\nD The rate of inflation falls.\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: What is the most effective way for a government to raise national output?\nA encourage a period of deflation\nB improve the productivity of resources\nC limit the size of its population\nD restrict its trade with other countries\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: A shop worker was made redundant due to the introduction of self-service checkouts.\n\nWhich type of unemployment is this?\nA cyclical\nB frictional\nC seasonal\nD structural\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: A decrease in which variable is most likely to cause the rate of inflation to increase?\nA the average wage rate\nB the budget deficit\nC the interest rate\nD the money supply\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: Which type of goods have to be financed by a government?\nA capital goods\nB demerit goods\nC free goods\nD public goods\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: 0\nimports of goods\n350\nexports of services\n110\nimports of services\n60\nnet primary income\n\u2013 40\n\nWhat is the country\u2019s balance on its current account?\nA a deficit of $60 million\nB a deficit of $160 million\nC a surplus of $20 million\nD a surplus of $760 million\n\n\n28 Vietnamese companies buy insurance from companies in the US.\n\nHow will this transaction be recorded in the Vietnamese balance of payments?\n\n\nsection\ncredit / debit\nA trade in goods\ncredit\nB trade in services\ncredit\nC trade in services\ndebit\nD current transfers\ndebit\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: Which row shows the potential benefits of free trade to consumers, producers and the economy?\n\n\nconsumers\nproducers\neconomy\nA higher income\nlower costs\ndeflation\nB lower quality\nhigher prices\ngreater equality\nC lower prices\nincreased competition\nhigher current account deficit\nD more choices\nlarger market\nlower unemployment\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: A manufacturing firm in a low-income country has decided to close.\n\nWhat is most likely to have caused this decision?\nA increase in foreign multinational companies operating in its country\nB increase in global demand for its products\nC increase in its productivity\nD increase in subsidies received from its government\n\n\n\nBLANK PAGE\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nThe Chinese government is concerned about the level of poverty and the need for more\nresources in low-income regions of the country. As a result, it is increasing its expenditure in\nthose regions and reducing it in high-income regions.\n\nWhich economic concept does this government policy illustrate?\nA diseconomies of scale\nB market forces\nC opportunity cost\nD specialisation\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nAn airline needs people and equipment. These can be divided into factors of production.\n\nWhat is allocated to its correct factor of production?\n\n\npeople or equipment\nfactor of production\nA aircraft\ncapital\nB airline owners\nlabour\nC computer network\nland\nD pilots\nenterprise\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nWhat is a disadvantage of a market economy?\nA Consumer choice is ignored.\nB Consumers may lack information.\nC Government subsidies encourage efficiency.\nD There is no incentive to work.\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nWhat is the definition of price elasticity of demand?\nA the responsiveness of quantity demanded of a product to a change in income of consumers\nB the responsiveness of quantity demanded of a product to a change in the price of a\ncomplementary product\nC the responsiveness of quantity demanded of a product to a change in the price of that\nproduct\nD the responsiveness of quantity demanded of a product to a change in the price of a\nsubstitute product\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nTo reduce traffic congestion, a government decides to build a new road. There is a toll charge on\nthe new road.\n\nWhat is the main purpose of this government intervention?\nA to address the problem of market failure\nB to discourage people from using public transport\nC to ensure the supply of transport through the free market\nD to obtain revenue from the levy of a toll\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nWhich organisations can directly fund the growth of firms?\n\n\ncentral\nbanks\ncommercial\nbanks\ngovernments\nA no\nyes\nno\nB no\nyes\nyes\nC yes\nno\nno\nD yes\nno\nyes\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: Which statement about different income groups is correct?\nA High-income groups do not need to borrow money.\nB High-income groups save less money than low-income groups.\nC Low-income groups find it easier to borrow than high-income groups.\nD Low-income groups save a smaller percentage of their income than high-income groups.\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: A musician has a choice of playing for an orchestra in either Germany or England.\n\nWhich combination of incomes and cost of living is most likely to cause her to choose the\nGerman orchestra?\n\n\nincomes and cost of living in Germany compared with those in England\npre-tax (gross) income\nafter-tax (net) income\ncost of living\nA higher\nhigher\nhigher\nB higher\nlower\nlower\nC lower\nhigher\nhigher\nD lower\nhigher\nlower\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: The central bank of a country decreases interest rates to help the economy out of a recession.\n\nHow is this decrease in interest rates most likely to affect the levels of saving in and borrowing\nfrom the country\u2019s commercial banks?\n\n\nsaving\nborrowing\nA decreases\ndecreases\nB decreases\nincreases\nC increases\nincreases\nD increases\ndecreases\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: Which effect of increased specialisation by firms and workers is most likely to cause problems for\nan economy?\nA better product quality\nB greater interdependence\nC higher productivity\nD improved resource allocation\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: Which statement is correct when comparing small firms with large firms?\nA Small firms are more able to adapt to changes in market conditions.\nB Small firms are more able to reduce competition through barriers to entry.\nC Small firms benefit from lower cost per unit from economies of scale.\nD Small firms have higher total fixed costs and lower average fixed costs.\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: Which pair is included in a government\u2019s budget?\nA consumption and factor income\nB exports and imports\nC investments and savings\nD public expenditure and tax revenue\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: A central bank reduces interest rates.\n\nWhat would not be a consequence of this action?\nA a benefit for borrowers receiving loans\nB a fall in the international value of the currency\nC a reduction in inflation\nD an increase in GDP\n\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: An individual decides to employ a professional decorator rather than buying the materials and\ndecorating her house herself.\n\nWhy would this decision cause GDP to rise?\nA The activity would be recorded as income for the decorator.\nB The individual would have more leisure time.\nC The professional decorator can purchase materials at a discount.\nD The professional decorator would work less efficiently than the individual.\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: What is the definition of the unemployment rate?\nA the benefits and allowances paid by the government to people without a job\nB the number of people without a job but seeking a job as a percentage of the labour force\nC the rate of change in the number of people who have not worked over the last year\nD the total number of people not working when the data was calculated\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: What is most likely to cause inflation?\nA a reduction in exports\nB a reduction in government spending\nC an increase in the rate of interest\nD an increase in trade union power\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: What is included in the Human Development Index (HDI)?\n\n\nenvironmental\nsustainability\nlife expectancy\nyears of schooling\nA no\nno\nyes\nB no\nyes\nno\nC no\nyes\nyes\nD yes\nyes\nyes\n\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: A fall in the level of absolute poverty can be best achieved by reducing\nA government unemployment benefits.\nB income tax.\nC the number of homeless people.\nD the rate of inflation.\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: 0\nimports of goods\n350\nexports of services\n110\nimports of services\n60\nnet primary income\n\u2013 40\n\nWhat is the country\u2019s balance on its current account?\nA a deficit of $60 million\nB a deficit of $160 million\nC a surplus of $20 million\nD a surplus of $760 million\n\n\n28 Vietnamese companies buy insurance from companies in the US.\n\nHow will this transaction be recorded in the Vietnamese balance of payments?\n\n\nsection\ncredit / debit\nA trade in goods\ncredit\nB trade in services\ncredit\nC trade in services\ndebit\nD current transfers\ndebit\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: What is a restriction on the quantity of imports called?\nA dumping\nB quota\nC subsidy\nD tariff\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: Which combination of factors would attract a multinational company (MNC) producing\nsmartphones to operate in a low-income country?\nA high economic growth rate and supply of cheap labour\nB low corporation tax and competitive local market\nC limited supply of skilled workers and cheap land\nD strict employment laws and high import duties\n\n\n\nBLANK PAGE\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nThe Chinese government is concerned about the level of poverty and the need for more\nresources in low-income regions of the country. As a result, it is increasing its expenditure in\nthose regions and reducing it in high-income regions.\n\nWhich economic concept does this government policy illustrate?\nA diseconomies of scale\nB market forces\nC opportunity cost\nD specialisation\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nAn airline needs people and equipment. These can be divided into factors of production.\n\nWhat is allocated to its correct factor of production?\n\n\npeople or equipment\nfactor of production\nA aircraft\ncapital\nB airline owners\nlabour\nC computer network\nland\nD pilots\nenterprise\n\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nA government decides to move towards a market economy by selling state-owned enterprises.\n\nWhat is a possible motive for this?\nA to create greater income equality\nB to extend government control of the economy\nC to increase efficiency of production\nD to take account of external costs\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nThe shoppers in a country become worried about a sudden and dangerous rise in air pollution\nand so buy more food in case they have to stay at home. As the air pollution spreads,\nsupermarket staff fall ill and the supermarkets struggle to keep their shelves full of food.\n\nX was the initial equilibrium in the market for food in supermarkets.\n\nWhat will be the new equilibrium as a result of the above situation?\n\nprice\nof food\nO quantity of food\nD3\nS3\nD1\nD2\nS1\nS2\nA D\nB C\nX \n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nWhich factor can influence the price elasticity of supply of a product?\nA the degree of necessity of the product\nB the level of spare capacity in the industry\nC the price of substitutes\nD the proportion of income spent on the product\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nWhat is a possible consequence of market failure?\nA Consumers have complete information about goods.\nB Disequilibrium continues in the market.\nC Merit goods are under-supplied.\nD Some goods are no longer demanded.\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nWhich organisations can directly fund the growth of firms?\n\n\ncentral\nbanks\ncommercial\nbanks\ngovernments\nA no\nyes\nno\nB no\nyes\nyes\nC yes\nno\nno\nD yes\nno\nyes\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: Which statement about different income groups is correct?\nA High-income groups do not need to borrow money.\nB High-income groups save less money than low-income groups.\nC Low-income groups find it easier to borrow than high-income groups.\nD Low-income groups save a smaller percentage of their income than high-income groups.\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: A musician has a choice of playing for an orchestra in either Germany or England.\n\nWhich combination of incomes and cost of living is most likely to cause her to choose the\nGerman orchestra?\n\n\nincomes and cost of living in Germany compared with those in England\npre-tax (gross) income\nafter-tax (net) income\ncost of living\nA higher\nhigher\nhigher\nB higher\nlower\nlower\nC lower\nhigher\nhigher\nD lower\nhigher\nlower\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: A trade union states that its members have experienced a loss in real income over the past five\nyears.\n\nWhat must have happened for this to be true?\nA Income tax rates have increased.\nB Prices have risen.\nC Savings have fallen.\nD Wages adjusted for inflation have fallen.\n\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: A firm provides a personal service to its customers. It prefers to remain labour-intensive rather\nthan changing to more capital-intensive production.\n\nWhich aspect of remaining labour-intensive would support this choice?\nA Customer satisfaction is higher.\nB Production costs are higher.\nC Production is less flexible.\nD Quality of customer service is worse.\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: A government decides to boost the economy through the use of a budget deficit.\n\nWhich target should it adopt to achieve this aim?\nA Direct taxation should exceed indirect taxation.\nB Export earnings should exceed import expenditure.\nC Government savings should exceed government investment.\nD Government spending should exceed government revenue.\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: A government decides to use a fiscal policy measure.\n\nWhat is an example of this?\nA increasing the exchange rate\nB reducing the power of trade unions\nC reducing the rate of corporation tax\nD setting a low interest rate\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: What would the government reduce to decrease inflation?\nA income tax\nB its foreign exchange rate\nC the money supply\nD the rate of interest\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: A country wishes to encourage economic growth.\n\nWhich policy measure is most likely to achieve this aim?\nA increasing interest rates\nB increasing spending on education\nC reducing the maximum permitted hours of work\nD reducing spending on infrastructure\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: How does a country usually measure its Gross Domestic Product?\nA by calculating the total value of all goods and services produced within the economy\nB by measuring the average prices of a basket of goods and services throughout the country\nC by subtracting government expenditure from government revenue\nD by surveying the number of people who are out of work but willing and able to work\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: What is the most likely consequence of increased unemployment?\nA higher output\nB higher government budget deficit\nC higher self-esteem\nD higher inflation\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: Why is deflation undesirable for an economy?\nA It reduces business confidence.\nB It reduces export competitiveness.\nC It reduces purchasing power.\nD It reduces real incomes.\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: Why does a government provide public goods?\nA Public goods are always used by everyone.\nB Public goods are not profitable for private firms.\nC Public goods can only be provided by monopolies.\nD Public goods create large external costs.\n\n\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: Which combination of government actions is most likely to raise the living standards of lower\nincome groups in an economy?\n\n\nindirect tax\nspending on\nhealthcare\npersonal tax-free\nallowance\nA increase\nincrease\ndecrease\nB increase\ndecrease\nincrease\nC reduce\nincrease\ndecrease\nD reduce\nincrease\nincrease\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: What is the usual effect of net immigration for a high-income country?\nA an increase in the size of the labour force\nB a rise in the average age of the population\nC lower economic growth\nD reduced demand for housing\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: 0\nimports of goods\n350\nexports of services\n110\nimports of services\n60\nnet primary income\n\u2013 40\n\nWhat is the country\u2019s balance on its current account?\nA a deficit of $60 million\nB a deficit of $160 million\nC a surplus of $20 million\nD a surplus of $760 million\n\n\n28 Vietnamese companies buy insurance from companies in the US.\n\nHow will this transaction be recorded in the Vietnamese balance of payments?\n\n\nsection\ncredit / debit\nA trade in goods\ncredit\nB trade in services\ncredit\nC trade in services\ndebit\nD current transfers\ndebit\n\n\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: Country X produces cars and also imports cars.\n\nWhich group is least likely to benefit from the introduction of an import tariff on cars?\nA consumers of cars in country X\nB producers of cars in country X\nC the government of country X\nD workers making cars in country X\n\n\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: What may be a cost to its home country when a multinational company (MNC) expands abroad?\nA Increased competition from the MNC may force firms in the host country to close.\nB Many jobs created by the MNC may be low-skilled.\nC The MNC\u2019s profits from the host country may be sent to its home country.\nD The MNC may cause job losses in its home country by moving production abroad.\n\n\n\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nproduction will cause external costs\nA relative poverty will gradually increase\nB sustainable development will take place\nC wants will exceed productive capacity\nD The diagram shows the production possibility curve (PPC) for an economy producing consumer\ngoods and capital goods.\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nconsumer\ngoods\nN M\nL O\nG H\nJ capital goods\nThe economy is currently producing OM consumer goods and OG capital goods. It decides to\nincrease production of capital goods to OH.\nWhat is the opportunity cost of this decision in terms of consumer goods?\nNL\nD MN\nC ML\nB JG\nA A hospital has spent all of its budget allocated for employing doctors.\nWhat is the opportunity cost to the hospital of employing an extra doctor?\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \na reduction in the number of nurses employed\nA an improvement in the recovery rate of patients\nB an increase in the number of patients treated\nC the salary paid to the extra doctor\nD There has been an increase in the demand for wheat. This has led to an increase in the demand\nfor labour to harvest the wheat.\nWhich branch of economics covers these two concepts?\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nincrease in the\ndemand for labour\nto harvest wheat\nincrease in the\ndemand for wheat\nmacroeconomics\nmacroeconomics\nA microeconomics\nmacroeconomics\nB macroeconomics\nmicroeconomics\nC microeconomics\nmicroeconomics\nD In the United Kingdom (UK), the price of timber used in house building increased. This was because\nof a boom in the UK house building industry and a shortage of drivers to deliver the timber.\nWhat happened in the UK market for timber to cause this price increase?\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nA firm will supply more when consumers\u2019 purchasing power increases.\nA The higher the price, the fewer goods are supplied as costs of production increase.\nB The lower the price, the more profit is made by the firm.\nC There is a positive relationship between quantity supplied and price.\nD A global pandemic causes the demand for air travel to decrease.\nWhich value for the price elasticity of supply of air travel will cause the number of tickets for air\ntravel to fall the most?\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \n1.5\nD 1\nC 0.5\nB 0\nA What is a disadvantage of a market economy?\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nnot enough competition\nA not enough merit goods\nB no consumer choice\nC state intervention\nD Droughts in some countries caused the supply of wheat to fall. Wheat prices then rose providing\nan opportunity for wheat producers in other countries to increase supply.\nWhy might the price of wheat continue to be high in the year following the drought?\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nDifferent weather conditions allowed a bumper harvest.\nA Suppliers unaffected by drought failed to increase output.\nB The government introduced a subsidy to wheat producers.\nC The wheat market returned to its original equilibrium.\nD Newly built houses tend to be inelastic in supply. A government aim is to make the supply more\nelastic by relaxing building regulations.\nWhy is the government not likely to achieve this aim immediately?\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nBanks will only lend to high-income earners.\nA Costs of building materials fluctuate according to season.\nB Houses take a long period of time to be built.\nC Population increases lead to greater housing demand.\nD A person planning for old age saves in the form of money rather than goods.\nWhich function does money perform when this is done?\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nmedium of exchange\nA standard of deferred payment\nB store of value\nC unit of account\nD What is not normally a function of the central bank of a country?\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nacting as lender of last resort\nA issuing notes and coins\nB operating the government monetary policy\nC setting the government budget\nD What is a trade union most likely to protect?\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nthe profit of a firm\nA the rights of a group of workers\nB the satisfaction of consumers\nC the social welfare of everybody\nD A person sets up a street food stall.\nWhat is necessary for the food stall to survive in the long run?\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nprofitability\ngrowth\nno\nno\nA yes\nno\nB no\nyes\nC yes\nyes\nD A large privately owned firm is the sole supplier of electricity to a city.\nWhich combination of characteristics is likely to exist for this firm?\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \npricing decision\nlong-run profit\nbarriers to entry\nprice maker\nhigh\nhigh\nA price taker\nlow\nhigh\nB price maker\nhigh\nlow\nC price taker\nlow\nlow\nD When a firm produces 200 units, its total variable cost is $600 and its total fixed cost is $2000.\nWhat is the average cost at this output?\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \n$2600\nD $13\nC $10\nB $3\nA The government of country Z announces a forecast budget deficit of $234 billion, as part of its fiscal\npolicy.\nWhat is the effect of this forecast budget deficit likely to be?\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \na decrease in economic growth\nA a decrease in inflation\nB an increase in employment\nC an increase in unemployment\nD Low-income groups do not pay income tax but are able to use state-provided healthcare services.\nWhat does this illustrate?\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nmonetary policy\nA privatisation\nB redistribution of income\nC regressive taxation\nD The government uses monetary policy and reduces the interest rate.\nWhat might be a consequence of this?\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \na decrease in the rate of inflation\nA an increase in the level of investment\nB an increase in the level of savings\nC an increase in unemployment\nD What is a likely objective of supply-side policy?\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nimproving productive potential\nA increasing direct taxation\nB increasing the power of trade unions\nC promoting the public sector\nD An increase in which economic indicator best describes economic growth?\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \ngeneral price level\nA level of consumption\nB level of output\nC living standards\nD What is full employment considered to be?\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nno cyclical unemployment\nA no frictional unemployment\nB no private sector unemployment\nC no seasonal unemployment\nD Which group is most likely to benefit during a period of rapid inflation?\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nexporters\nA pensioners\nB people with debts\nC savers\nD What are the components of the Human Development Index (HDI)?\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nlife expectancy at birth, expected years of schooling, gross national income (GNI)\nA life expectancy at birth, expected years of schooling, gross national income (GNI) per head\nB population growth, adult literacy rate, gross national income (GNI) per head\nC population size, expected years of schooling, number of doctors per head\nD Which situation must produce an ageing population?\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \na falling birth rate and a falling death rate\nA a rising birth rate and a rising death rate\nB a rising marriage rate and a falling death rate\nC a falling marriage rate and a rising death rate\nD The table shows the unemployment rate in three developed economies in one year.\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nunemployment\nrate %\n7.6\nUnited States\n8.2\nSweden\n10.9\nFrance\nWhat is the main cause of high rates of unemployment in developed economies in periods of\nrecession?\ndecreases in total demand\nA movement of labour between countries\nB reduced levels of technological change\nC regional inequalities of wealth\nD What is most likely to result from an extension of specialisation in manufacturing?\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nfor the consumer some prices will be reduced\nA for the country there will be less dependency on international trade\nB for the employee the work will become more varied\nC for the producer there will be less efficiency\nD A country imposes a tariff on an imported product.\nWhat is the effect of this change?\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nthe quantity of the\nproduct imported\nis fixed\nthe price of the\nproduct increases\nno\nno\nA yes\nno\nB no\nyes\nC yes\nyes\nD The world demand for oil is price-inelastic and oil is paid for in US dollars.\nIf the price of oil falls rapidly, how might it affect the US dollar?\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nexchange rate for US$\nmarket for US$\nincreases\ngreater demand for US$\nA decreases\ngreater supply of US$\nB decreases\nless demand for US$\nC increases\nless supply of US$\nD Which benefit do multinational companies (MNCs) bring to their home country?\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nflow of profits\nA higher wages\nB increased employment\nC more investment\nD BLANK PAGE\nBLANK PAGE\n\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nEconomic goods are not scarce.\nA Economic goods have no opportunity cost.\nB Free goods are scarce.\nC Free goods have no opportunity cost.\nD The economy of country X is always on its production possibility curve (PPC).\nWhen will the goods and services produced by country X become more scarce?\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \npopulation size\nPPC\nincreases\nshifts left\nA unchanged\nshifts right\nB decreases\nunchanged\nC unchanged\nunchanged\nD What is capital?\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nthe ability to organise the factors of production\nA the energy used in production\nB the factory used in production\nC the money invested in a firm\nD What are features of a market economy?\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \ngovernment\nallocation\nof production\npublic ownership\nof factors of\nproduction\nprivate ownership\nof factors of\nproduction\nyes\nno\nno\nA yes\nyes\nno\nB no\nno\nyes\nC yes\nyes\nyes\nD Public transport and cars are substitute goods. The price of public transport rises.\nWhat will happen to the demand for cars?\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nIt will contract.\nA It will extend.\nB It will decrease.\nC It will increase.\nD The markets of four products are all in equilibrium. The table gives the value of the price elasticity\nof supply (PES) for each product.\nThe demand for each product shifts to the right by 5000 units at all prices.\nWhich product will have the largest price increase?\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nprice elasticity\nof supply\n0 A\n0.6\nB 1.0\nC 2.5\nD What is the value of the price elasticity of demand (PED) for a product if total revenue remains the\nsame when the price is reduced?\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nzero\nA between 0 and 1\nB greater than 1\nC 1\nD The owner of a hotel in Malaysia finds that the price elasticity of demand (PED) for accommodation\nin the area is \u20131.7.\nIf the hotel owner decreases the price of a room by 5%, how would the demand for a room change?\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nIt would decrease by 2.9%.\nA It would decrease by 8.5%.\nB It would increase by 2.9%.\nC It would increase by 8.5%.\nD Good weather results in an increase in the demand for tomatoes. It also increases the supply of\ntomatoes.\nWhat must be a result of this?\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nThe price of tomatoes will fall.\nA The price of tomatoes will rise.\nB The quantity of tomatoes traded will fall.\nC The quantity of tomatoes traded will rise.\nD What causes a change in the price of a product in a free market economy?\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nchanges in demand and supply conditions\nA changes in external costs and external benefits\nB changes in government decisions\nC changes in the quantity of public goods\nD The ways of making and receiving payments continue to develop. Payments can now be made\nusing smartphones, as well as cash, debit cards and credit cards.\nWhich method of paying for products provides no information to sellers about their customers?\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \ncash\nA debit cards\nB credit cards\nC smartphones\nD In most countries, which organisation controls the banking system?\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \ncentral bank\nA commercial bank\nB investment bank\nC World Bank\nD What is not a reason for differences in the earnings of airline pilots in a particular country?\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nbargaining power of employees\nA discrimination\nB government policies\nC inflation\nD An airline takes over an online clothing company.\nWhat is an advantage of such a move by the airline?\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nto diversify their operations\nA to generate economies of scale\nB to improve lines of communication\nC to increase market share\nD In which type of industry is a firm most likely to make a large profit in the short run and in the long\nrun?\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nbarriers to entry\ninto the industry\nnumber of firms\nin the industry\nhigh\nmany\nA low\nmany\nB high\none\nC low\none\nD A firm produces five units of output at an average cost of $20 per unit. The cost of the sixth unit is\n$26.\nWhat is the average cost of six units?\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \n$21\nD $8.33\nC $6\nB $4.33\nA What is an example of government macroeconomic policy?\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nincreasing the money supply\nA preventing price rises in the food industry\nB removing a monopoly\u2019s barriers to entry\nC setting a maximum price for wheat\nD Why would devaluing the international value of an economy\u2019s currency help reduce unemployment?\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nDevaluing the currency would increase the cost of production.\nA Devaluing the currency would increase the confidence of investors.\nB Devaluing the currency would increase the foreign demand for domestic products.\nC Devaluing the currency would increase the demand for imports.\nD What is likely to happen when the rate of interest increases?\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nconsumer spending increases\nA firms buy fewer machines\nB people hold more cash\nC savers earn lower rewards\nD What is not a supply-side policy measure?\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \ncontrol of trade union power\nA higher indirect taxation\nB privatisation\nC skills training for workers\nD The table shows the real GDP per head for a country in 2021 and 2022.\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \n2022\n2021\n$21000\n$20000\nWhat is most likely to have changed between 2021 and 2022?\nIncomes were distributed more evenly.\nA There was more activity in the informal economy.\nB The living standards of some people improved.\nC The rate of inflation increased.\nD Which change to fiscal policy is most likely to reduce cyclical unemployment in an economy?\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nincreasing direct taxation\nA increasing the budget deficit\nB increasing the budget surplus\nC increasing the money supply\nD What must have happened in a country when it experienced an annual rate of inflation of 100%?\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nThe money supply doubled.\nA The price level halved.\nB The purchasing power of money halved.\nC The real value of money doubled.\nD The Human Development Index (HDI) can be used to measure human development in countries.\nWhich measure would not be part of its calculation?\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \ninequality of incomes\nA life expectancy\nB gross national income per head\nC years of schooling\nD What is the most likely consequence of an ageing population for a high-income economy?\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nThere will be a fall in the dependency ratio.\nA There will be a fall in the level of immigration.\nB There will be an increase in geographic mobility.\nC There will be an increase in spending on healthcare.\nD In some developing countries a large percentage of the population is involved in subsistence\nfarming.\nWhat can be concluded from this?\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nEach family will be able to produce enough to live on.\nA Production is unlikely to be capital intensive.\nB Production will be efficient.\nC There will be a high level of trade.\nD A small country whose only export is oil decides to reduce substantially the rate at which it extracts\nits limited oil reserves.\nWhat is the most likely reason for this decision?\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nto improve the balance of payments in the following year\nA to increase current government income\nB to maintain future living standards\nC to raise the level of employment in the oil industry\nD Country X believes that country Y is selling steel at prices below the average cost of production.\nSo, country X imposes a higher tariff on steel imports from country Y.\nWhat does country X hope to achieve by imposing this higher tariff?\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \navoid country X dumping steel in country Y\nA avoid country Y dumping steel in country X\nB reduce inflation in country X\nC reduce inflation in country Y\nD Which factor would cause a country\u2019s exchange rate to fall?\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nDemand for imports increases.\nA Domestic interest rates rise.\nB Domestic savings increase.\nC More tourists visit the country.\nD Many European firms employ workers from the Philippines. These workers send part of their income\nto relatives in the Philippines.\nIn which part of the balance of payments current account for the Philippines would these transactions\nbe recorded?\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nprimary income\nA secondary income\nB trade in goods\nC trade in services\nD BLANK PAGE\nBLANK PAGE\n\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nexcess demand\nA free goods\nB market failure\nC the economic problem\nD The diagram shows a production possibility curve (PPC) for a country. The country moved from\nposition X to position Y on the PPC.\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nO capital\ngoods\nconsumer goods\nX Y\nWhat is the most likely reason for this change?\nFirms have decided to increase investment in technology.\nA New economic resources have been discovered in the country.\nB The government has brought about an increase in living standards.\nC The government has encouraged long-term economic growth.\nD Which type of factor of production is a railway track?\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \ncapital\nA enterprise\nB labour\nC land\nD Which statement must be correct if a market is in disequilibrium?\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nQuantity demanded and quantity supplied are equal.\nA The government must intervene if anything is to be sold.\nB There can be no changes to demand or supply.\nC There is excess supply or excess demand.\nD What is a determinant of price elasticity of demand (PED)?\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \navailability of stocks of the product\nA change in the income of consumers\nB degree of necessity of the product\nC existence of monopoly\nD What would cause the supply curve for an agricultural product to shift to the right?\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nan increase in the costs of production\nA an increase in the price of substitutes\nB an increase in the price of the good\nC an increase in the productivity of farms\nD What would increase the price elasticity of supply (PES) of a product?\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nan increase in the cost of inputs\nA an increase in the firm\u2019s profits\nB an increase in the number of close substitutes\nC an increase in the time a product can be stored\nD The diagram shows a demand curve.\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nO D\nX Y\nP2\nQ2\nQ1\nP1\nprice\nquantity\nWhat does the movement from X to Y show?\na decrease in quantity demanded due to an increase in price\nA a decrease in quantity demanded due to changes in the conditions of demand\nB an increase in quantity demanded due to changes in the conditions of demand\nC an increase in quantity demanded due to an increase in price\nD In a market there is a surplus of a good.\nWhich change would cause the market to come to an equilibrium?\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \na decrease in demand\nA a fall in price\nB a rise in price\nC an increase in supply\nD When the price of a good is $10, the quantity demanded is 100 units per day.\nWhich combination of price change and price elasticity of demand will cause the largest increase\nin the quantity demanded for the good?\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nprice elasticity\nof demand\nprice change\n0.8\nprice falls to $9\nA 1.2\nprice falls to $9\nB 0.8\nprice rises to $11\nC 1.2\nprice rises to $11\nD A function of money is to act as a measure of value.\nWhat does this mean?\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nIt is used for future savings.\nA It is used to compare the worth of different goods.\nB It is used to enable monthly payments for expensive goods.\nC It is used to pay the price of a good.\nD In 2008\u20132009 the central bank of a developed country reduced interest rates from 5% to 0.5% per\nyear to stimulate the economy.\nHow would this policy have affected the amount saved and the cost of borrowing by individuals?\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \ncost of\nborrowing\namount saved\ndecreased\ndecreased\nA increased\ndecreased\nB decreased\nincreased\nC increased\nincreased\nD Many small energy providers have closed down due to rising costs.\nWhat is the likely effect of this on the price of energy and choice of energy providers for consumers,\nassuming there is no government intervention?\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nchoice of\nenergy providers\nprice of\nenergy\ndecreases\ndecreases\nA increases\ndecreases\nB decreases\nincreases\nC increases\nincreases\nD What is the most likely goal of a state-owned enterprise providing health services?\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \nprofits\nA public satisfaction\nB sales revenue\nC survival\nD Some governments allow monopoly markets to exist.\nWhat is a reason for this?\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nto attract entry into the market\nA to fund research and development\nB to increase prices for consumers\nC to maximise monopoly profits\nD The table shows the costs incurred by a firm producing computers.\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \ntotal costs\n($ thousands)\noutput\n(thousands)\n20\n1200\n1350\n1450\n0 1\n2 3\nWhat are the fixed costs if 3000 computers are produced?\n$4020000\nD $1450000\nC $1430000\nB $20000\nA A government increases its revenue by higher direct taxation of both personal incomes and company\nprofits.\nWhat is most likely to be the reason for this increase?\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nto control spending on specific consumer goods\nA to encourage business investment\nB to provide public and merit goods\nC to reduce pollution from industrial production\nD Income tax in a country gives all individuals an initial tax-free income allowance. Any income above\nthis allowance is taxed at increasing rates as the incomes of individuals rise.\nWhich change to this income tax will be regressive?\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \ndecreasing the lowest rate of tax\nA decreasing the tax-free income allowance\nB increasing the tax-free income allowance\nC increasing the top rate of tax\nD A government lowers the rate of interest.\nWho is most likely to be disadvantaged by this policy?\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nhouse buyers\nA manufacturers\nB retailers\nC savers\nD What is a supply-side policy measure?\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \na tariff on imported goods\nA an increase in indirect taxes\nB a contractionary monetary policy\nC the removal of barriers to entry to a market\nD What is the most likely consequence of economic growth?\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nmore equal income distribution\nA more use of resources\nB reduced imports\nC reduced tax revenue\nD In high-income economies, cereal farming is highly productive but few workers are employed.\nWhat could have caused this employment situation?\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \na fall in world demand for cereals\nA a lack of capital equipment\nB increased mechanisation of agriculture\nC large-scale migration from rural areas\nD Who is most likely to benefit during a period of inflation?\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \ncreditors (lenders)\nA debtors (borrowers)\nB fixed income earners\nC holders of cash\nD The table shows some economic indicators.\nWhich increase in the first indicator is most likely to lead to an increase in the second indicator?\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nsecond indicator\nfirst indicator\nconsumer saving\nbudget surplus\nA unemployment\nconsumer spending\nB trade surplus\ninflation\nC living standards\nproductivity\nD Which combination would be most likely to increase the population of a country?\n\n Answer: D" }, { "notes": "", "input": "", "output": "Question: \nnet immigration\ndeath rates\nbirth rates\npositive\nhigh\nhigh\nA positive\nlow\nhigh\nB negative\nhigh\nlow\nC negative\nlow\nlow\nD Which economic consequence is most likely to result from an increasing proportion of the population\nbeing over the age of 65?\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nGovernment transfer payments will increase.\nA More facilities will be needed to retrain workers.\nB The total savings in the economy will increase.\nC There will be a rise in the economic growth rate.\nD What is most likely to encourage international specialisation?\n\n Answer: A" }, { "notes": "", "input": "", "output": "Question: \nsimilarities in climate in different countries\nA the ability to produce products more cheaply than other countries\nB the discovery of oil in a country that had no oil before\nC very high international transport costs\nD Country X established free trade agreements with other nations.\nWhat would be the intended benefit of such agreements to country X?\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nincreased labour shortages\nA increased tariff revenue\nB more efficient allocation of resources\nC protection from low wage competition\nD A country\u2019s foreign exchange rate appreciates significantly.\nWhich group in the country will directly benefit from this change?\n\n Answer: C" }, { "notes": "", "input": "", "output": "Question: \na government department which only buys locally made goods\nA retailers who get all their supplies from foreign producers\nB workers in local companies that compete with foreign firms in the local market\nC workers in local companies that sell only in foreign countries\nD What is measured in the secondary income balance in a country\u2019s current account of the balance\nof payments?\n\n Answer: B" }, { "notes": "", "input": "", "output": "Question: \nnet contributions to international and regional organisations\nA net exports of goods and services\nB net foreign investment flows\nC net inflow of income from factors of production abroad\nD BLANK PAGE\n\n\n Answer: A" } ]