SS1 First Term Economics Past Questions And Answers

 

Here they are;

 

Question: What is the primary goal of economic systems?

 

a) Profit maximization

b) Wealth distribution

c) Resource allocation

d) Consumer satisfaction

Answer: c) Resource allocation

Question: Define the term “opportunity cost” in economics.

 

a) Actual cost incurred

b) Next best alternative foregone

c) Total cost of production

d) Market price

Answer: b) Next best alternative foregone

Question: In which market structure does a single seller dominate the entire market?

 

a) Perfect competition

b) Monopoly

c) Oligopoly

d) Monopolistic competition

Answer: b) Monopoly

Question: What is inflation?

 

a) Increase in the money supply

b) Decrease in the general price level

c) Increase in the general price level

d) Stable prices over time

Answer: c) Increase in the general price level

Question: Which factor of production includes physical and mental effort by individuals?

 

a) Land

b) Labor

c) Capital

d) Entrepreneurship

Answer: b) Labor

Question: What is the role of the Central Bank in an economy?

 

a) Fiscal policy implementation

b) Monetary policy regulation

c) Tax collection

d) Public goods provision

Answer: b) Monetary policy regulation

Question: Define the law of demand in economics.

 

a) As price increases, quantity demanded decreases

b) As price decreases, quantity demanded increases

c) Price and quantity demanded are unrelated

d) Quantity supplied equals quantity demanded

Answer: b) As price decreases, quantity demanded increases

Question: Which type of unemployment occurs when workers are between jobs?

 

a) Structural unemployment

b) Frictional unemployment

c) Cyclical unemployment

d) Seasonal unemployment

Answer: b) Frictional unemployment

Question: What is the equilibrium price in a market?

 

a) The highest price a consumer is willing to pay

b) The lowest price a producer is willing to accept

c) The price where quantity demanded equals quantity supplied

d) The price set by the government

Answer: c) The price where quantity demanded equals quantity supplied

Question: Define the term “elasticity of demand.”

 

a) Responsiveness of quantity demanded to changes in income

b) Responsiveness of quantity demanded to changes in price

c) Proportion of income spent on a good

d) Total quantity of a good demanded in the market

Answer: b) Responsiveness of quantity demanded to changes in price

Question: In which market structure do many firms sell similar but not identical products?

a) Perfect competition

b) Monopoly

c) Oligopoly

d) Monopolistic competition

Answer: d) Monopolistic competition

Question: What is the function of the World Trade Organization (WTO)?

a) Currency regulation

b) Trade liberalization and dispute resolution

c) Environmental protection

d) Labor market regulation

Answer: b) Trade liberalization and dispute resolution

Question: Define “Gross Domestic Product (GDP)” in economics.

a) Total value of goods and services produced in a country within a specific time frame

b) Total value of exports minus imports

c) Total government expenditure

d) Total income of all citizens

Answer: a) Total value of goods and services produced in a country within a specific time frame

Question: What is the difference between a progressive tax and a regressive tax?

a) Progressive taxes increase as income increases, while regressive taxes decrease with income

b) Progressive taxes decrease as income increases, while regressive taxes increase with income

c) Both increase proportionally with income

d) Both decrease proportionally with income

Answer: a) Progressive taxes increase as income increases, while regressive taxes decrease with income

Question: What is the main function of the International Monetary Fund (IMF)?

a) Providing financial aid to developing countries

b) Regulating international trade

c) Promoting global economic stability and growth

d) Setting global interest rates

Answer: c) Promoting global economic stability and growth

Question: Define the term “monetary policy.”

a) Government spending to influence the economy

b) Central bank’s management of the money supply and interest rates

c) Taxation to control inflation

d) Regulation of international trade

Answer: b) Central bank’s management of the money supply and interest rates

Question: What is a budget deficit?

a) Excess of government expenditures over revenues in a specific period

b) Excess of government revenues over expenditures in a specific period

c) Total government debt

d) Balance between government revenues and expenditures

Answer: a) Excess of government expenditures over revenues in a specific period

Question: In the production possibilities frontier (PPF) model, what does a point inside the curve represent?

a) Inefficient use of resources

b) Maximum efficiency

c) Economic growth

d) Unattainable production levels

Answer: a) Inefficient use of resources

Question: Define the law of supply in economics.

a) As price increases, quantity supplied decreases

b) As price decreases, quantity supplied increases

c) Price and quantity supplied are unrelated

d) Quantity demanded equals quantity supplied

Answer: b) As price decreases, quantity supplied increases

Question: What is the role of entrepreneurship in the economy?

a) Resource ownership

b) Risk-taking and innovation

c) Labor force management

d) Monetary policy implementation

Answer: b) Risk-taking and innovation.