Exam_Economics_Question_SS1
  • 1. The study of how people make choices in the use of scarce resources is known as
A) economics
B) political science
C) geography
D) sociology
  • 2. Economics is best defined as the study of
A) the production of goods only
B) how to make profit
C) money and banking
D) human behaviour as a relationship between ends and scarce means
  • 3. Who is regarded as the father of modern economics?
A) Adam Smith
B) Karl Marx
C) David Ricardo
D) John Keynes
  • 4. The central concept in economics is
A) money
B) demand
C) utility
D) scarcity
  • 5. The branch of economics that studies the whole economy is
A) micro-economics
B) political economics
C) macro-economics
D) business economics
  • 6. The term 'choice' in economics arises because
A) wants are limited
B) people are greedy
C) resources are scarce
D) goods are abundant
  • 7. Which of these best describes opportunity cost?
A) cost of production
B) The total benefit gained
C) The amount of money spent
D) The next best alternative forgone
  • 8. Wants are said to be unlimited because
A) governments are corrupt
B) new wants keep arising
C) money is scarce
D) man's resources are few
  • 9. The economic problem of scarcity means
A) there are not enough resources to satisfy wants
B) there too many goods
C) prices are always high
D) consumers are rich
  • 10. The study of economics helps individuals to
A) spend carelessly
B) waste resources
C) make rational decisions
D) ignore opportunity costs
  • 11. Government studies economics mainly to
A) formulate good policies
B) exploit the poor
C) increase corruption
D) raise salaries
  • 12. Economics contributes to national development by
A) encouraging waste
B) increasing inequality
C) Helping efficient resource use
D) discouraging production
  • 13. Knowledge of economics helps a consumer to
A) buy more than needed
B) waste resources
C) make wise spending decisions
D) avoid saving
  • 14. Economist help businesses by
A) producing advertisments
B) increasing wages automatically
C) printing money
D) determining market trends
  • 15. The basic economic problems arise because
A) governments are weak
B) population is high
C) wants are unlimited and resources are limited
D) prices are low
  • 16. 'What to produce' refers to
A) cost of production
B) choice of techniques
C) location of production
D) type of goods to produce
  • 17. 'How to produce' refers to
A) the total output
B) the time of production
C) who will consume the goods
D) the method or technique of production
  • 18. 'For whom to produce' means
A) choosing who gets the goods and services
B) deciding what to export
C) determining the cost
D) hiring workers
  • 19. Which of the following helps solve the basic economic problems?
A) Trade unions
B) Choice
C) Scarcity
D) Inflation
  • 20. Production in economics means
A) manufacturing only
B) creating goods and services to satisfy human wants
C) buying and storing
D) selling goods at a market
  • 21. The major aim of production is to
A) increase population
B) create employment
C) satisfy human wants
D) reduce exports
  • 22. The process that changes raw-materials into finished goods is called
A) exchange
B) distribution
C) consumption
D) manufacturing
  • 23. Primary production involves
A) mining, farming and fishing
B) transport and trade
C) banking and insurance
D) advertising
  • 24. Secondary production includes
A) banking
B) manufacturing
C) farming
D) teaching
  • 25. Tertiary production involves
A) mining
B) construction
C) manufacturing
D) service industries
  • 26. When goods are moved from factory to consumers, this is
A) exchange
B) production
C) distribution
D) consumption
  • 27. Which of these is a form of indirect production?
A) self-cooking
B) Building your own house
C) Washing your own clothes
D) Tailor sewing for pay
  • 28. The reward for the successful organization of production is
A) profit
B) interest
C) wage
D) rent
  • 29. How many major factors of production are there?
A) Five
B) Four
C) Two
D) Three
  • 30. The reward for land is
A) Rent
B) wage
C) profit
D) interest
  • 31. Land as a factor of production refers to
A) buildings and machines
B) capital
C) all natural resources used in production
D) soil only
  • 32. Labour refers to
A) land
B) buildings
C) machines
D) all human efforts used in production
  • 33. The reward for labour is
A) wage
B) profit
C) interest
D) rent
  • 34. Capital is important in production because it
A) decreases output
B) reduces unemployment
C) causes scarcity
D) increases efficiency
  • 35. The entrepreneur is responsible for
A) organizing and managing the factors of production
B) providing only labour
C) earning rent
D) making government policies
  • 36. The reward for the entrepreneur is
A) interest
B) wage
C) rent
D) profit
  • 37. Which of the following IS NOT a reward of any factor of production?
A) Subsidy
B) Interest
C) Rent
D) Profit
  • 38. In the study of economics land, labour, capital and entrepreneur are referred to as factors of production. These factors produce commodities only if they are
A) brought into the factory
B) purchased for the purpose of production
C) combined in the production process
D) profitable to the production process
  • 39. Production resources can also be called
A) primary productive
B) items of production
C) labour and material resources
D) factors of production
  • 40. Economics is founded on the principle that
A) human needs are easy to define
B) human wants are limitless while the means to satisfy them are limited
C) human wants are more than human wants
D) material things are more than human wants
  • 41. An example of circulating capital used by an entrepreneur is
A) factory building
B) pipe-borne water
C) raw materials
D) electric power
  • 42. Immobility of land in the geographical sense is applicable ONLY to
A) vegetation and it's products
B) land as the earth surface
C) all natural resources
D) fishes in water bodies
  • 43. Which of the following factors of production is the most mobile?
A) Capital
B) Entrepreneur
C) Land
D) Labour
  • 44. The act of combining factor inputs in order to obtain specific output is known as
A) production
B) manufacturing
C) factor procurement
D) industrialization
  • 45. Capital as a factor of production is important because
A) people can work without capital
B) most tasks can be done with bare hands
C) it enables us to carry out tasks which cannot be done by human effort only
D) it provides money which is essential for the growth of business
  • 46. Which of the following factors of production consists of man-made goods?
A) Capital
B) labour
C) Entrepreneur
D) Land
  • 47. Which of the following IS NOT regarded as labour?
A) Physical effort
B) Skillful effort
C) Mental effort
D) Immobility of labour
  • 48. Choice is necessary because resources
A) are scarce
B) are available
C) are available
D) are limited
  • 49. Economic problems arise because of
A) the absence of skilled labour
B) corruption in high places
C) the creation of artificial scarcity
D) inadequate resources
  • 50. Which of the following is a basic economic problem of a society?
A) What to produce
B) Scarcity
C) level of inflation
D) Price of commodity
Created with That Quiz — where test making and test taking are made easy for math and other subject areas.