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