The document contains multiple-choice questions (MCQs) related to AS Level CIE Economics, covering topics such as normative statements, economic problems, factors of production, demand elasticity, public goods, fiscal policy, international trade, income inequality, and sustainable development. Each question presents four options, with only one correct answer for each. The questions assess knowledge of fundamental economic concepts and principles.
The document contains multiple-choice questions (MCQs) related to AS Level CIE Economics, covering topics such as normative statements, economic problems, factors of production, demand elasticity, public goods, fiscal policy, international trade, income inequality, and sustainable development. Each question presents four options, with only one correct answer for each. The questions assess knowledge of fundamental economic concepts and principles.
The document contains multiple-choice questions (MCQs) related to AS Level CIE Economics, covering topics such as normative statements, economic problems, factors of production, demand elasticity, public goods, fiscal policy, international trade, income inequality, and sustainable development. Each question presents four options, with only one correct answer for each. The questions assess knowledge of fundamental economic concepts and principles.
The document contains multiple-choice questions (MCQs) related to AS Level CIE Economics, covering topics such as normative statements, economic problems, factors of production, demand elasticity, public goods, fiscal policy, international trade, income inequality, and sustainable development. Each question presents four options, with only one correct answer for each. The questions assess knowledge of fundamental economic concepts and principles.
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AS LEVEL CIE ECONOMICS MCQ’S
1. Which of the following is a normative statement?
a) The unemployment rate is 5%.
b) Inflation has increased by 2%.
c) The government should increase taxes on the wealthy.
d) GDP grew by 3% last year.
2. The basic economic problem is:
a) How to reduce inflation.
b) How to achieve full employment.
c) Scarcity of resources relative to unlimited wants.
d) How to control the money supply.
3. Which factor of production earns rent?
a) Labour
b) Capital
c) Land
d) Entrepreneurship
4. A movement along the demand curve is caused by:
a) A change in consumer tastes.
b) A change in the price of the good.
c) A change in income.
d) A change in the price of a substitute good.
5. If the price elasticity of demand is 2, and price increases by 10%, quantity demanded will:
a) Increase by 20%. b) Decrease by 20%. c) Increase by 5%. d) Decrease by 5%.
6. Which of the following is a characteristic of a public good?
a) Excludability b) Rivalry c) Non-excludability d) Private provision
7. A tax on a good with inelastic demand will:
a) Lead to a large decrease in quantity demanded. b) Lead to a small decrease in quantity demanded. c) Lead to a large increase in quantity demanded. d) Have no effect on quantity demanded.
8. Which of the following is an example of a merit good?
a) National defense b) Street lighting c) Education d) Fast food
9. The primary function of money is to act as a:
a) Store of value. b) Medium of exchange. c) Unit of account. d) Standard of deferred payment.
10. Which of the following is a component of aggregate demand (AD)?
a) Exports b) Imports c) Savings d) Taxes
11. Cost-push inflation is caused by:
a) An increase in aggregate demand. b) A decrease in aggregate supply. c) An increase in the money
supply. d) A decrease in government spending.
12. Which of the following is a tool of fiscal policy?
a) Interest rates b) Reserve requirements c) Government spending d) Open market operations.
13. The main aim of supply-side policies is to:
a) Control inflation. b) Increase aggregate demand. c) Increase aggregate supply. d) Reduce
unemployment.
14. Which of the following is a characteristic of a perfectly competitive market?
a) Barriers to entry b) Product differentiation c) Many buyers and sellers d) Price-setting power
15. A monopoly is characterized by:
a) Many firms b) Perfect information c) A single seller d) Free entry and exit
16. Which of the following is a type of unemployment?
a) Inflationary unemployment b) Cyclical unemployment c) Interest rate unemployment d) Exchange
rate unemployment
17. The balance of payments consists of the:
a) Current account and capital account. b) Income statement and balance sheet. c) Budget deficit and national debt. d) Trade surplus and trade deficit.
18. A depreciation of the domestic currency will:
a) Increase exports and decrease imports. b) Decrease exports and increase imports. c) Increase both exports and imports. d) Decrease both exports and imports.
19. Which of the following is a factor affecting exchange rates?
a) Interest rates b) Inflation rates c) Economic growth d) All of the above
20. A tariff is a:
a) Tax on imports. b) Subsidy on exports. c) Quota on imports. d) Voluntary export restraint.
21. Which of the following is a benefit of international trade?
a) Increased domestic employment. b) Greater consumer choice. c) Reduced competition. d)
Increased government revenue.
22. Which of the following is a disadvantage of a quota?
a) It generates government revenue. b) It leads to higher prices for consumers. c) It protects domestic industries. d) It increases consumer choice.
23. The Gini coefficient measures:
a) Inflation. b) Unemployment. c) Income inequality. d) Economic growth.
24. Which of the following is a cause of income inequality?
a) Progressive taxation. b) Equal access to education. c) Differences in skills and education. d) Strong welfare systems.
25. Which of the following is a characteristic of a developing economy?
a) High GDP per capita. b) Low levels of poverty. c) High levels of industrialization. d) Dependence on primary sector activities.
26. Which of the following is a measure of economic development?
a) GDP b) HDI c) Inflation rate d) Unemployment rate.
27. Which of the following is a potential problem with economic growth?
a) Increased living standards. b) Environmental degradation. c) Reduced poverty. d) Improved
healthcare.
28. Which of the following is a benefit of foreign direct investment (FDI)?
a) Increased domestic competition. b) Job creation. c) Environmental damage. d) Loss of sovereignty.
29. Which of the following is a potential problem associated with privatization?
a) Increased efficiency. b) Reduced government revenue. c) Job losses. d) Increased consumer choice.
30. Which of the following is a goal of sustainable development?
a) Maximizing economic growth at all costs. b) Meeting the needs of the present without compromising the ability of future generations to meet their own needs. c) Exploiting natural resources for short-term gains. d) Ignoring environmental concerns in favor of economic development.
