SS3 First Term Economics Past Questions And Answers
Question: What is the primary function of money in an economy?
a) Barter transactions
b) Medium of exchange
c) Barter negotiations
d) Medium of production
Answer: b) Medium of exchange
Question: Which of the following is not a factor of production?
a) Land
b) Labor
c) Capital
d) Profit
Answer: d) Profit
Question: What is the law of demand?
a) As price increases, quantity demanded decreases
b) As price decreases, quantity demanded increases
c) Price and quantity demanded are unrelated
d) Quantity demanded remains constant regardless of price changes
Answer: b) As price decreases, quantity demanded increases
Question: In economics, what does GDP stand for?
a) Gross Domestic Product
b) General Demand Profile
c) Government Development Plan
d) Global Development Protocol
Answer: a) Gross Domestic Product
Question: Which market structure is characterized by a large number of sellers with similar products?
a) Monopoly
b) Oligopoly
c) Monopolistic competition
d) Perfect competition
Answer: d) Perfect competition
Question: What is the opportunity cost of a decision?
a) The actual cost incurred
b) The monetary cost involved
c) The highest-valued alternative forgone
d) The explicit cost of the decision
Answer: c) The highest-valued alternative forgone
Question: What is inflation?
a) Decrease in the overall price level
b) Increase in the overall price level
c) Stability in the overall price level
d) Fluctuation in the exchange rate
Answer: b) Increase in the overall price level
Question: The study of how individuals and societies allocate scarce resources to satisfy unlimited wants is known as:
a) Anthropology
b) Sociology
c) Economics
d) Psychology
Answer: c) Economics
Question: Which of the following is a fiscal policy tool used by governments to manage the economy?
a) Monetary policy
b) Interest rates
c) Taxation
d) Exchange rates
Answer: c) Taxation
Question: What does the term “invisible hand” refer to in economics?
a) Government intervention
b) Market forces guiding self-interest to promote the social good
c) Barter system
d) Perfect competition
Answer: b) Market forces guiding self-interest to promote the social good
Question: The demand curve slopes downward because:
a) Buyers prefer lower prices
b) Sellers increase prices
c) Quantity demanded increases with higher prices
d) Quantity demanded decreases with higher prices
Answer: d) Quantity demanded decreases with higher prices
Question: Which of the following is a characteristic of a command economy?
a) Private ownership of resources
b) Government control of resources and production
c) Market-driven prices
d) Limited government intervention
Answer: b) Government control of resources and production
Question: What is a monopoly?
a) A market structure with many sellers
b) A market structure with one seller
c) A market structure with identical products
d) A market structure with differentiated products
Answer: b) A market structure with one seller
Question: What does the term “elasticity of demand” measure?
a) Responsiveness of quantity demanded to changes in price
b) Total quantity demanded
c) Inelasticity of supply
d) Government intervention in the market
Answer: a) Responsiveness of quantity demanded to changes in price
Question: Which of the following is a form of indirect tax?
a) Income tax
b) Sales tax
c) Property tax
d) Corporate tax
Answer: b) Sales tax
Question: The point where the demand and supply curves intersect is known as:
a) Equilibrium price
b) Market surplus
c) Price ceiling
d) Price floor
Answer: a) Equilibrium price
Question: What is the role of the World Trade Organization (WTO) in international trade?
a) Setting monetary policies
b) Promoting free and fair trade
c) Managing exchange rates
d) Controlling domestic inflation
Answer: b) Promoting free and fair trade
Question: Which of the following is a characteristic of a developed economy?
a) High unemployment rate
b) Low standard of living
c) Advanced infrastructure and technology
d) Limited access to education
Answer: c) Advanced infrastructure and technology
Question: What is the law of diminishing marginal utility?
a) The more you consume, the more satisfaction you get
b) The less you consume, the more satisfaction you get
c) The additional satisfaction from consuming one more unit decreases
d) Marginal utility remains constant
Answer: c) The additional satisfaction from consuming one more unit decreases
Question: Which economic system relies on the forces of supply and demand with minimal government intervention?
a) Market economy
b) Command economy
c) Mixed economy
d) Socialist economy
Answer: a) Market economy.
