Economics 2024/2025 Trial Test Questions (30) Objective Questions

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Select the correct options for each Questions below

1. What is the basic economic problem of scarcity?

a) Unlimited wants and limited resources b) Unlimited resources and limited wants c) Equal distribution of resources d) Excess resources and wants

2. Which of the following is NOT a factor of production?

a) Land b) Labor c) Money d) Capital

3. In economics, what is the term for the total value of all goods and services produced within a country in a given period?

a) Gross National Product (GNP) b) Gross Domestic Product (GDP) c) Net Export Value (NEV) d) Consumer Price Index (CPI)

4. What is the term for the total income earned by all factors of production in an economy in a given period?

a) Gross Domestic Product (GDP) b) Gross National Product (GNP) c) National Income (NI) d) Personal Income (PI)

5. In economics, what is the term for the measure of the responsiveness of the quantity demanded of a good to a change in its price?

a) Elasticity b) Utility c) Monopoly d) Inflation

6. Which type of economic system relies on market forces to allocate resources and determine prices?

a) Command economy b) Traditional economy c) Market economy d) Mixed economy

7. Which of the following is NOT a characteristic of a monopoly?

a) Single seller b) Price taker c) High barriers to entry d) Unique product

8. What is the term for a market structure where there are many buyers and sellers, and no single buyer or seller can influence the market price?

a) Monopoly b) Oligopoly c) Monopolistic competition d) Perfect competition

9. Which of the following is an example of a regressive tax?

a) Income tax b) Sales tax c) Property tax d) Corporate tax

10. What is the term for a situation in which the government spends more money than it collects in revenue?

a) Budget surplus b) Budget deficit c) Fiscal policy d) National debt

11. What is the term for the percentage of the labor force that is unemployed and actively seeking employment?

a) Inflation rate b) Unemployment rate c) Interest rate d) Exchange rate

12. Which of the following is NOT a goal of fiscal policy?

a) Price stability b) Economic growth c) Full employment d) International trade balance

13. Which economic concept refers to the ability to produce a good or service at a lower opportunity cost than others?

a) Comparative advantage b) Absolute advantage c) Marginal utility d) Diminishing returns

14. Which type of unemployment occurs when individuals are unemployed because they lack the necessary skills for available jobs?

a) Cyclical unemployment b) Structural unemployment c) Frictional unemployment d) Seasonal unemployment

15. In the context of international trade, what is a trade surplus?

a) When a country exports more than it imports b) When a country imports more than it exports c) When a country has no international trade d) When a country has a balanced trade

16. What is the term for a legal limit on the quantity of a good that can be imported into a country?

a) Quota b) Tariff c) Subsidy d) Embargo

17. What economic concept refers to the increase in the overall price level of goods and services over time?

a) Deflation b) Inflation c) Stagflation d) Recession

18. Which economic indicator measures the average change over time in the prices paid by urban consumers for a market basket of consumer goods and services?

a) GDP b) CPI c) PPI d) GNP

19. Which of the following is an example of a progressive tax?

a) Sales tax b) Property tax c) Income tax d) Excise tax

20. What is the term for the monetary policy tool used by central banks to control the money supply and interest rates by buying and selling government securities?

a) Open market operations b) Discount rate c) Reserve requirement d) Fiscal policy

21. Which economic concept refers to the additional satisfaction or pleasure obtained from consuming one more unit of a good or service?

a) Marginal utility b) Diminishing returns c) Elasticity d) Opportunity cost

22. What is the term for a market structure where there are only a few large firms that dominate the market?

a) Monopoly b) Oligopoly c) Monopolistic competition d) Perfect competition

23. Which of the following is a characteristic of a command economy?

a) Private ownership of resources b) Competition among firms c) Centralized government control d) Consumer choice

24. What is the term for a tax that takes a larger percentage of income from high-income earners than from low-income earners?

a) Progressive tax b) Regressive tax c) Proportional tax d) Excise tax

25. What is the term for the total value of a country's exports minus the total value of its imports?

a) Balance of payments b) Balance of trade c) Trade deficit d) Trade surplus

26. What is the term for a tax on imported goods?

a) Quota b) Tariff c) Subsidy d) Embargo

27. What is the term for a situation in which a country's currency is worth less relative to another currency?

a) Depreciation b) Appreciation c) Devaluation d) Inflation

28. In economics, what is the term for a general and sustained increase in the level of prices for goods and services?

a) Deflation b) Stagflation c) Recession d) Inflation

29. What is the term for the total quantity of goods and services produced by an economy in a given time period, usually a year?

a) Gross National Product (GNP) b) Gross Domestic Product (GDP) c) Net Export Value (NEV) d) Consumer Price Index (CPI)

30. Which of the following is NOT a characteristic of a traditional economy?

a) Barter system b) Custom and tradition determine economic activity c) Centralized government control d) Little technological advancement