Here goes
Plus do let me have any additions - or corrections :-)
Question Answer
What is the difference between a want & a need? a need is an essential
needed for survival a want is a non essential
How is economic activity measured? Using NYA
What's the concept that measures the change in demand for a product in
response to a change in the price of another? XED
What is economic growth increase in gdp, gnp etc over time
What is barter the direct exchange of goods and services without the use of
money.
Which of the following changes would not cause a shift in the demand curve:
a) an increase in the price of a competitor's product b) a change in tastes
and fashion c) a price reduction as part of a marketing campaign d) an
increase in disposable incomes
Q. Unemployment can be measured by the ILO Labour Force Survey, but what
does ILO stand for? A. International Labour Organisation
If market price falls by 5% following a rise in supply, and there is no
change in the quantity bought, the demand curve is A completely elastic B
completely inelastic B completely inelastic
Name one injection into the circular flow of income I, G or X
What's the term to describe a situation where resources are allocated so
that no-one can be made better off without someone else being made worse
off? allocative efficiency
The essential condition for an item to act as money is that: A it is legal
tender B it is generally acceptable B it is generally acceptable
What is a product a good or a service
What was the name of the speculator who made over £1bn from the departure of
Sterling from the Exchange Rate Mechanism on 16th September 1992? George
Soros
Monetary policy involves the manipulation of the supply of money or interest
rates in the economy
What is Capacity the degree of use of factors of production
The origin of the European Union was the EEC in 1958. Six countries
established this group. West Germany, Italy and Netherlands were three. Can
you name one of the others? A. France, Belgium, Luxembourg
Give an example of an activity in the secondary sector manufacturing
With whom are 'invisible hands' associated? A. Adam Smith
This is what keeps competition away from monopolies. Barriers to entry
This term describes a situation where people are not self sufficient, but
instead produce goods and services that they are efficient in and trade the
surplus for other goods and services Specialisation
When did the UK join the European Community? 1973
Who was T R Malthus a UK economist who argued that population has a tendency
to grow faster than the output of food.
Marginal revenue is the income received from the sale of one extra unit. MR
= TR/Q
Loss leader strategy means the practice of selling a product or products at
a low price in order to attract customers who will buy other products.
What is Absolute poverty an income level below that necessary to meet basic
needs. The UN measure is $1 per day
The boom in the late 1980s is associated with which Chancellor? Nigel Lawson
What is present discounted value (PDV) The value today of an expected stream
of future net benefits ie costs - benefits for each year of the project
What is a Command economy The state sets production targets and growth rates
and allocates resources according to its own view of people's wants. The
government makes all economic decisions.
How is transport usage measured? Passenger billion passenger kilometres;
Freight: billion tonne kilometres
Market share is the proportion of total sales accounted for by a particular
brand or firm.
What is the mobility of labour the extent to which labour can move between
jobs and regions.
Market structure is the number and type of firms in a particular industry.
What was the Bretton Woods system an arrangement of fixed exchange rates
which operated between 1945 and 1971.
Production possibility frontier shows the combination of two goods a
country can make in a given time period with resource fully employed
Excess demand is when consumers want to buy more than producers are
prepared to sell.
Prices and incomes policies is when a government freeze on price and income
increases
What is a Poverty trap a situation in which a rise in income results in the
recipient being worse off once tax has been paid and benefits withdrawn.
What is meant by money is a unit of account? money is used to measure the
value of goods in exchange eg one pint is worth £2
What is meant by structural change in an economy Changes in the relative
share of gdp accounted for by the primary, secondary and tertiary sectors.
Specific tax is a fixed tax per unit eg 11p per pint.
Secondary data is existing published information.
Resource allocation means a particular use of land, labour, capital and
entrepreneurs
What does elasticity measure The responsiveness of one variable to a given
change in another
Name two government macro policy objectives low unemployment, low and stable
inflation, a satisfactory balance of payments position and steady economic
growth.
Who was David Ricardo a UK economist who developed the theories of
comparative advantage and economic rent
Disequilibrium means a state of imbalance in which there is tendency for
change.
What is the difference between production and productivity Production is
output whereas productivity is output per factor of production.
Shadow prices are estimated prices in situations where market prices do not
exist.
Consumer sovereignty refers to the power of consumers to determine what
goods and services are produced.
VAT stands for Value Added Tax
Define value added output less input; sales less costs
An Engels curve shows the relationship between income and consumption.
What is the Economic problem while our resources are finite, our wants and
needs are infinite. Therefore society has to choose what, how and for whom
to produce.
Industrial inertia occurs when the initial reasons for location have
disappeared
What is Cost plus pricing setting prices by adding a profit margin to
average cost.
Entrepreneurs are people who organise land labour and capital and accepting
the risks of production in return for profit.
Give an example of demand side policies to control congestion: road pricing;
supplementary licences; raise road fuel duty
Factor endowments are the resources which a country posess.
What are Differentiated products goods or services which are distinguished
from rival products by eg packaging, advertising
Non-excludability means once the good is provided, others cannot easily be
stopped from also consuming it eg public parks
Who was Rostow American economist W.W. Rostow, argues growth proceeds in
stages from a traditional society to a transitional one (in which the
foundations for growth are developed), to the "take-off" society (in which
development accelerates), to the mature society.
Integrated transport occurs when passengers and freight can easily switch
between different modes of transport in a given journey
Wealth means a stock of all those assets capable of earning an income.
Wealth can be human or material
How would an increase in the productive capacity of the economy be
illustrated on a production possibility diagram? A shift of the production
possibility frontier to the right
What is a currency exchange rate? the price of one currency in terms of
another
Search unemployment is a form of A frictional unemployment B structural
unemployment A frictional unemployment
What is effective demand willingness and ability to pay
Fiscal drag means As national income rises, tax revenues rise and
government spending falls thereby slowing the economy down (ie automatic
fiscal stabiliser). This may inhibit the recovery of an economy form
recession.
What is the output gap? The output gap is the difference between actual
output and potential output
What is Sustainable Development? Sustainable development is development that
meets the needs of the present without compromising the ability of future
generations to meet their own needs.
What is the aim of government regulation of markets? The aim of regulation
is to attempt to correct for a market failure
What causes a movement along an aggregate demand curve? change in price
level (following a shift in AgS)
Multinational corporations are firms which produce goods in more than one
country
Who was Keynes UK economist who urged state intervention to achieve full
employment
Joint demand means goods which are used together ie complements are in
joint demand.
What is the Income-leisure trade-off the choice labour makes between working
more hours or taking more leisure when the rate of income tax changes.
What is the main, short run, opportunity cost of economic growth? A
reduction in consumer goods
What is the polluter pays principle? Polluters should be taxed the amount of
their externality
What does the marginal propensity to consume measure proportion of each
extra pound spent
What are Public Private Partnerships? PPPs are joint ventures between
private sector firms and public sector agencies.
The largest component of UK aggregate demand is A consumption B government
expenditure A consumption
What is the doubling time effect of growth rates every 1% per annum increase
means gdp doubles in size every 72 years
What factor is not held constant when drawing a demand curve price
What is Real GDP Real GDP is nominal (money) GDP adjusted for inflation.
Why does a normal supply curve for corn slope upwards from left to right? A
farmers charge more to cover a rise in the price of seed B farmers are
willing to produce more corn as price increases B farmers are willing to
produce more corn as price increases
What does the HDI measure standard of living, education and life exepctancy
What does the phrase demand is elastic mean? Demand is relatively responsive
to a given change in price
A favourable movement in the terms of trade occurs when the index rises
Price elasticity of supply will be smaller A the longer the time period
under consideration B the more immobile the factors of production used B
the more immobile the factors of production used
How is total revenue calculated P x Q or AR x Q
In which market structures may supernormal profits be earned in the long
run? Imperfect competition
What does the RPI measure? price level or inflation
Which of the following is a characteristic of the downturn of a business
cycle? A Increasing stocks of unsold goods B Falling government expenditure
on benefits B Falling government expenditure on benefits
What is a lagging indicator of changes in economic activity? A lagging
indicator is one which reacts after the change in the business cycle.
If the price of a product rises by 10% and total revenue remains constant,
price elasticity of demand is:- unitary or PED = 1
What will be the effect on supply following the introduction of
labour-saving technology? increase in supply and a shift in the SS curve to
the right or down
Which of the following is an example of a free good: sea water or B state
education sea water
Which of the following would cause a shift of the supply curve to the right?
A A decrease in production costs B An increase in the price of the product
A A decrease in production costs
Market failure occurs when there is an imperfectly competitive market
because A price exceeds marginal cost B all firms are profit maximisers A
price exceeds marginal cost
What type of firms have a legal identity or personality limited companies ie
plcs or ltds
Which of the following is the most accurate measure of a country's standard
of living? A real national income B per capita real national income B per
capita real national income
What is the reward of land rent
A government decides to introduce an urban road tax. If this is set at the
socially efficient level this will: A eliminate road congestion B reduce
congestion to an optimal level B reduce congestion to an optimal level
Who is the Shadow Chancellor of the Exchequer Frances Maud
Which of the following comes closest to being a pure public good? A
education B flood control C medical care B flood control
Goods which are in joint supply are: A sold together B consumed together C
produced together D produced by the same firm C produced together
What is the main cost of unemployment is foregone output. foregone output
Why do some firms satisfice because of a conflict of objectives between
stakeholders eg profit (shareholders) and bonuses (eg managers)
Why is the supply of fresh salmon more inelastic than the supply of tinned
salmon? Fresh salmon cannot be stored
What is Social Benefit = Private Benefit + External Benefit
Give two possible objectives for a firm: profit, survival, growth, sales
maximisation etc
What 'Q' is a restriction on the number of goods which a government will
allow to be imported or exported? Quota
What are the three main sections of the balance of payments the current
account, the capital account and the financial account.
How do firms increase output in the short run? Firms increase output by
adding more (marginal) labour to fixed capital
The most common use of cost benefit analysis has been for planning: A the
budget position B public sector investment schemes B public sector
investment schemes
What are the two main types of fiscal policy the use of taxation and
government spending
Oftel is an example of what? a regulatory body
Give an example of a progressive tax income tax
What would shift the production possibility frontier of an economy to the
right? Economic growth
In which type of market structure are there no barriers to entry and exit?
perfect competition or monopolistic competition
Who is Sir Alisdiar Morton? The Rail Regulator
Which is a regressive tax: television licence or corporation tax television
licence
What is Collective bargaining occurs when the union negotiates pay and
working conditions on behalf of all its members.
Give an example of derived demand workers, transport
Explain the occupational immobility of labour workers have the wrong skills
for changing jobs from lack of skill or inability to retrain; employment
barriers placed by unions and professional bodies
State a characteristic of a public good non rivalrous; non excludable
Why is interest paid Compensate lender for loss of use of funds and risk of
loan not being paid back
Only in a pure command economy does production A respond to prices B
respond to directives A respond to prices
Which of the following is an example of fiscal policy? A changes in
interest rates B Change in income tax B Change in income tax
The economist responsible for suggesting that 'supply creates its own
demand' Say
What does DETR stand for Dept of the Environment, Transport and the Regions
In the poorest countries in the world most of the population is employed in:
A the primary sector B the secondary sector A the primary sector
Which type of firms have their own legal identity? limited companies
Who is First Lord of the Treasury The Prime Minister Tony Blair
What is the shape of the supply curve for a concert vertical, perfectly
price inelastic
What is the branch of economics dealing with value judgements? Normative
economics
Who first used the red bag used by the Chancellor on budget day Gladstone
Which market structure exists when one firm can supply the market more
efficiently than any other number? Natural monopoly
Which of the following is a characteristic of a perfectly competitive
industry? A firms are price takers B some differentiation of products A
firms are price takers
What is left when private costs are taken from social costs? External costs
Demerit goods are products that: A can only be bought in a black market B
are likely to be over consumed in a market economy B are likely to be over
consumed in a market economy
Which right wing think tank has the initials ASI Adam Smith Institute
What is an inferior good As income increases demand falls (-ve YED)
Who wrote the Wealth of Nations in 1776 Adam Smith
What does the concept of cross elasticity of demand (XED) measure?
Responsiveness of demand for one good to a change in the price of another
What is human capital people and their ability to be economically
productive. Education, training, and health care can help increase human
capital
Define consumer surplus When people are able to buy a good for less than
they would be willing to pay.
A monopolist seeks to earn maximum profits. How will they decide which
level of output to produce? Set Q where MC=MR
What is the Latin phrase for all other things being equal Ceterus paribus
Define the difference between a change in demand and change in quantity
demanded (Qd) Change in demand cased by a change in a condition of demand
resulting in a shift in DD. A change in in quantity demanded (Qd) is caused
by a change in price and a movement along a DD curve
What does the IMF stand for International Monetary Fund
What is an Asian Tiger? Far East country with high growth rate eg Korea
What is tax incidence the burden of an indirect tax falling on a consumer
or producer
Which of the following is a necessary condition for a firm to practice price
discrimination? 1 different cost structures in each market 2 different
price elasticities of demand in each market 2 different price elasticities
of demand in each market
How are slumps measured? Consecutive falls in real gdp
Skimming means a pricing policy sometimes used by companies introducing a
new product. A high price is set to ensure large profits are made before the
competitors are able to produce a similar product.
Internal economies of scale are These are economies made within a firm as a
result of mass production. As the firm produces more and more goods, so
average cost begin to fall
Market system occur when Resources are owned by individuals and allocated by
profit and price signals.
Horizontal integration occurs when a car manufacturer: A buys a chain of
garages B merges with a second car manufacturer B merges with a second car
manufacturer
Which specialist magazine is published weekly covering economics and
politics The Economist
Give one problems firms experience in estimating elasticities past data may
no longer be relevant; past data trends may not be repeated in the future;
Many factor s affect DD & SS; were other factors at work apart from change
in one variable?; Collecting data is expensive
If two goods share a - XED they are complements
Non-rivalness means The consumption of a good by one person does not prevent
others from enjoying the same good. eg a lighthouse.
Full employment means everyone has a job. True or false False
Which law explains why short run average cost curves fall? Economies of
scale
What causes occupational immobility of labour workers with inflexible skills
Define Producer surplus When firms receive more than they require to supply
a good
Q3 With reference to the long run average cost curve, what does the acronym
MES stand for? Minimum efficient scale
What are weights in the retail price index weights indicate what proportion
of consumer expenditure is devoted to the different categories of
expenditure
Average fixed costs will remain constant as output increases. True or false?
False
What does a Phillips curve show Relationship between inflation and
unemployment
Which of the following sources of investment finance is not available to a
sole trader? A retained profits B the issue of shares B the issue of
shares
If a firm increases output from 400 to 750 units after doubling all of its
factor inputs. It can be said that it has experienced (a) increasing, (b)
constant or (c) decreasing returns to scale? Decreasing returns.
Adam Smith described the division of labour among what type of worker? pin
workers
Give an example of a fixed cost of owning a motor car Insurance, road tax,
etc
Define opportunity cost Cost of X in terms of the next best alternative
forgone Y
The natural rate of unemployment is the rate A at which unemployment is
zero B at which inflation is constant B at which inflation is constant
What is labour productivity output per person
Who is the Governor of the Bank of England Sir Eddie George
If average cost is falling:- A marginal cost must also be decreasing B
marginal cost must be lower than average cost B marginal cost must be lower
than average cost
What will happen to the demand for luxury goods during a recession? A
recession means output hence incomes are falling. YED for luxury goods is
elastic Therefore a bigger fall in demand than the fall in income.
Regards
Richard Young
Business Studies, Economics & ICT Teacher
Wood Green School
Woodstock Road
Witney OX28 1DX
Tel 01993 702355
Fax 01993 708662
www.woodgreen.oxon.sch.uk
BECTa/Guardian Secondary School Web Site of the Year 2001
[log in to unmask]
-----Original Message-----
From: For teachers and lecturers interested in curriculum issues
affecting the te [mailto:[log in to unmask]] On Behalf
Of Alison Eves
Sent: 04 November 2001 18:26
To: [log in to unmask]
Subject: Re: Weakest link 2001
Dear Richard,
Could you post a copy of your economics version of "the weakest link"?
Many thanks!
Alison
--
Alison Eves
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