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Business, Other
9th -
10thgrade
Basic economic problem and the factors of production
25 questions
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- 1. Multiple Choice
What is an example of the purchase of a consumer good?
A farm owner buys a television
A farm owner buys additional land
A farm owner buys fertiliser for their crops.
A farm owner buys some farming equipment.
- 2. Multiple Choice
What is the function of the factors of production in an economy?
to make goods and services to fulfil wants and needs
to provide an even distribution of income
to provide tax income for the government
to reduce the existence of external costs
- 3. Multiple Choice
A natural resource was discovered in a country. The exploitation of this resource allowed the country to double its gross domestic product within ten years. Why did this not solve the basic economic problem?
Exploiting the resource required high expenditure on capital equipment.
Exploiting the resource caused significant environmental damage.
Gross domestic product was unevenly distributed in the country.
Wants still exceeded the resources available to meet those wants.
- 4. Multiple Choice
What is not a factor of production?
a $20 banknote
an office
a photocopier
a secretary
- 5. Multiple Choice
What is classified as one of the four economic resources?
consumption
enterprise
production
trade
- 6. Multiple Choice
Which statement about factors of production is correct?
A Capital is the amount of money borrowed from a bank.
Labour is output made by an employee.
Land includes commercially grown rice crops
Profit is the reward for enterprise
- 7. Multiple Choice
What identifies a finite resource?
The resource does not renew itself
The supply of the resource is greater than demand
There is no opportunity cost for the resource
There is unlimited supply of the resource
- 8. Multiple Choice
What would an economist regard as an example of the factor of production capital?
an individual’s purchase of stocks and shares
borrowing by a firm to pay for electricity
the building by a firm of a new factory
total savings by individuals in a country
- 9. Multiple Choice
A government wishes to increase agricultural output. It gives farmers the tools to irrigate the farmers’ fields. Which factors of production are provided by the farmers?
capital and enterprise
enterprise and labour
labour and land
land and capital
- 10. Multiple Choice
In farming, what is an example of what economists call capital?
savings the farmer has in the bank
shares in a farming company
the money the farmer set aside to pay taxes
the tractor owned by the farmer
- 11. Multiple Choice
Which factor of production involves risk-taking?
capital
enterprise
labour
land
- 12. Multiple Choice
What is the basic problem facing all economies?
how to achieve a stable balance of payments
how to maximise tax revenues
how to reach full employment
how to use scarce resources
- 13. Multiple Choice
What do economies aim to achieve in tackling the economic problem of scarcity?
equal balance between public and private sectors
equal reward for equal effort
increased competition in the use of resources
optimum allocation of finite resources
- 14. Multiple Choice
Hospital services are provided by the government and paid for through taxation. People cannot always get the treatment they require because of long waiting lists. Of what is this an example?
external cost
market system
perfectly inelastic supply
scarcity
- 15. Multiple Choice
What would be classified by an economist as the factor of production known as land?
a discovery of oil in the South China sea
an oil rig bought by an oil company
money held by the oil companies in their bank accounts
the productivity of oil workers
- 16. Multiple Choice
What is the cause of the economic problem facing all countries?
A climate change and global warming
significant quantities of unemployed resources
uneven distribution of income and wealth
unlimited wants in relation to limited resources
- 17. Multiple Choice
What would be classified as the factor of production capital for an airline?
the aircraft operated by the airline
the money the airline keeps in the bank
the pilots the airline uses
the shares of the airline quoted on the stock market
- 18. Multiple Choice
The introduction of robots has meant that many firms now require fewer workers to produce their goods and services. According to this statement, which factor of production is replacing workers?
capital
enterprise
labour
land
- 19. Multiple Choice
What best describes the problem of scarcity?
All consumer wants must be satisfied.
All resources are free at the point of use.
There are limited resources and unlimited wants.
There are unlimited resources and limited wants.
- 20. Multiple Choice
What is an example of the purchase of a capital good?
a farm owner purchasing additional land
a farm owner purchasing a television
a farm owner purchasing a tractor
a farm worker purchasing some seeds
- 21. Multiple Choice
Economics textbooks identify the existence of scarcity as the basic economic problem. What is it that makes scarcity a problem?
It can cause inflation and unemployment.
It is impossible to satisfy unlimited wants.
It is the first priority of governments
It only affects the richest countries.
- 22. Multiple Choice
An oil company announced in 2015 that it was starting its drilling operations for oil deposits in the Arctic Ocean. What will be the effect of this?
to increase the supply of raw materials
to reduce the level of technology available
to solve the economic problem
to worsen resource allocation
- 23. Multiple Choice
A self-employed fortune teller earns a living by reading the palms of people’s hands. Which factors of production are essential to this activity?
A capital and enterprise
enterprise and labour
labour and land
land and capital
- 24. Multiple Choice
Economists refer to factors of production. Which is not a factor of production?
the fields of a farm
the machinery in a factory
the shares of a company
the staff in an office
- 25. Multiple Choice
What does an economist mean by the factor of production called capital?
goods that can be used to produce other goods
money used to start a business
money used to start a business
the profits of a company
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