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