Question 1
What is meant by trade-off?
A.
The next best alternative forgone. B.
Finished goods such as phones, cars and food. C.
Sacrificing one outcome to pursue another. D.
Shows economic growth — more output possible.
Question 2
Define a production possibility frontier (PPF).
A.
The maximum combinations of two goods an economy can produce when all resources are fully employed. B.
The profit-maximising output level for one firm C.
A curve showing inflation and unemployment D.
Any point where demand equals supply
Question 3
What is meant by under-employed resources?
A.
Idle and not used at all. B.
Resources fully employed; cannot produce more of one good without less of another (Pareto efficiency). C.
An increase in a country's productive capacity. D.
Not used to maximum capacity.
Question 4
What is meant by economic growth?
A.
Sacrificing one outcome to pursue another. B.
An increase in a country's productive capacity. C.
Shows maximum combinations of output with all resources used. D.
Resources fully employed; cannot produce more of one good without less of another (Pareto efficiency).
Question 5
What is meant by unemployed resources?
A.
Shows maximum combinations of output with all resources used. B.
Finished goods such as phones, cars and food. C.
Idle and not used at all. D.
Sacrificing one outcome to pursue another.
Question 6
What is meant by productive efficiency?
A.
Shows falling productive capacity, e.g. war or disaster. B.
Resources fully employed; cannot produce more of one good without less of another (Pareto efficiency). C.
The next best alternative forgone. D.
Not used to maximum capacity.
Question 7
A point inside the PPF indicates:
A.
Equilibrium price B.
Maximum output C.
Productive inefficiency D.
Economic growth
Question 8
What is meant by consumer goods?
A.
Finished goods such as phones, cars and food. B.
Idle and not used at all. C.
Machinery used to produce consumer goods. D.
Resources fully employed; cannot produce more of one good without less of another (Pareto efficiency).
Question 9
What is meant by opportunity cost?
A.
Finished goods such as phones, cars and food. B.
The next best alternative forgone. C.
Not used to maximum capacity. D.
Shows falling productive capacity, e.g. war or disaster.
Question 10
An outward PPF shift shows:
A.
Recession B.
Market failure C.
Inflation D.
Economic growth
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