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Economics Questions Unit 1

This document contains an economics exam with multiple choice, true/false, matching, and short answer questions. The exam covers topics like scarcity, demand and supply, production possibilities curves, market equilibrium, and different economic systems. It tests the student's understanding of foundational microeconomics concepts as well as the ability to apply those concepts to analyze graphs and scenarios. The exam was submitted by Raey Yonas to their instructor Mr. Abdissa for a unit 1-4 economics course.

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raeydesta2012
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141 views5 pages

Economics Questions Unit 1

This document contains an economics exam with multiple choice, true/false, matching, and short answer questions. The exam covers topics like scarcity, demand and supply, production possibilities curves, market equilibrium, and different economic systems. It tests the student's understanding of foundational microeconomics concepts as well as the ability to apply those concepts to analyze graphs and scenarios. The exam was submitted by Raey Yonas to their instructor Mr. Abdissa for a unit 1-4 economics course.

Uploaded by

raeydesta2012
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
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Economics

questions
Unit 1 - 4

Section:9B
COURSE TITLE:Economics
Submitted by: Raey Yonas
Submitted to: Mr.Abdissa
Submission date:1/9/2024
I Choose the correct answer and write the letter of your choice on the space provided.
1.What studies how people make decisions when faced with scarcity?
a, Psychology c, macroeconomics
b, microeconomics d, history
2.Which one of the following would be most likely to cause the demand for firewood to increase?
A. a decrease in the price of firewood.
B. a decrease in the price of electricity.
C. an increase in the price of fuel oil.
D. a reduction in the price of chain saws, which are used to cut firewood.
E. all of the above will cause an increase in demand for firewood.
3. Suppose you need to study six hours per week to earn a C, nine hours per week to earn a B, and 15 hours per
week to earn an A. This implies:
A. increasing returns to hours studied.
B. decreasing returns to hours studied.
C. constant returns to hours studied.
D. that extra study is a waste of time.
4. if a researcher is studying consumer spending habits and collects data on households' expenditure and then
analyze the data for patterns and trends. Based on the analysis, they develop hypotheses about consumer
spending behavior then carry out Further research to validate the hypotheses and refine understanding. this
method of studying economics is known as:
a, inductive method c, predictive method
b, conclusive method d, deductive method
5. One purpose of advertising is to:
A. shift the demand curve for the good to the right.
B. shift the demand curve for the good to the left.
C. shift the supply curve for the good to the left.
D. make the demand curve for substitute goods shift to the right, thus increasing the demand for the advertised
good.
6. All of the following would tend to increase a nations production possibilities EXCEPT:
A. the society becomes more accepting of women who work.
B. a new hybrid for wheat is discovered.
C. a government program is instituted that encourages college education.
D. the nation decides (by whatever method) to increase production of investment goods and decrease production
of consumption goods.
E. all of the above would tend to expand a nations production possibilities.
7. What is the financial gain made in transactions?
A. Profit C. Scarcity
B. Resource D. Wage
8. Suppose that in the land of Plenty there is no scarcity. We can conclude that:
A. all resources are fully employed.
B. the production possibilities curve is concave to the origin.
C. opportunity costs are zero when the production of bread increases.
D. all goods are free.
E. both c and d are correct.
9. What is the primary focus of the normative approach in economics?
a) Describing and analyzing economic phenomena as they are
b) Predicting future economic trends and outcomes
c) Prescribing how economic outcomes should be
d) Understanding the historical developments of economic theories

II Write true if the statement is correct and false if it is not


10. Because economy is a static subject it results in the lack of uniformity in defining economics.
11. The question “What goods and services are to be produced” is also known as the problem of the distribution
of the national product of a country.
12. We can take land as an example of non renewable resource
13. Quantity demanded is the entire relation between price and quantity.
14.Scarcity and shortage are the same in the concept of economy
III Match the responses given under column 'B' to the items given under column 'A'.

A B
15. rent A.is what Corporations are in business for
16. interest B.is financial compensation in exchange for labor
17. profit. C. The reward for the services of the land
18. wage D. The reward for the services of capital

VI Fill in the blanks with the correct answer


19.Decision Making Units in an economy focus on ________________.
20.The choice between the techniques of production depends on ________________.
21.A fall in the price of raw milk, used in the production of ice cream, will _____________ the supply of ice
cream.
IV Answer the following questions
22. what are the steps in the deductive method of studying economics?
23. using the PPF below determine which points are efficient, inefficient or unattainable
24. In country ‘A’, the government implements policies that allow privately owned businesses to operate
alongside state-owned enterprises. Additionally, country ‘A’ has a tax system that redistributes wealth to
address income inequalities. we can consider country ‘A’ to be:
25. Define market equilibrium

Answers to the questions above


I Choose
1.B
2.C
3.A
4.A
5.A
6.E
7.A
8.E
9.C
II True/false
10.F
11.F
12.T
13.F
14.F
III Match
15.C
16.D
17.A
18.B
VI Fill in the blanks
19. allocating resources
20. the available supplies
21.Increase
IV Answer the following questions
22. theory development ---- hypothesis formulation ------ data collection -----data analysis----conclusion

23 Points:
R and S are not efficient
T, L and M are efficient.
N is unattainable
24. Mixed economy
25. it refers to the balance between opposite forces of demand and supply

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