Economics Practice IG2 2

Which of the following is NOT a factor that can shift the demand curve?

• Income

• Price of related goods

• Government regulations

• Consumer preferences

What is the formula for calculating price elasticity of demand?

• (Change in quantity demanded / Change in price) x 100

• (Change in price / Change in quantity demanded) x 100

• (Initial price - Final price) x Quantity demanded

• (Final price - Initial price) x Quantity demanded

Which of the following is an example of a public good?

• A restaurant meal

• A private jet

• National defense

• Designer clothing

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

• A progressive tax takes a larger percentage of income from low-income earners, while a regressive tax takes a smaller percentage of income from high-income earners.

• A progressive tax takes a larger percentage of income from high-income earners, while a regressive tax takes a smaller percentage of income from low-income earners.

• A progressive tax is only paid by businesses, while a regressive tax is only paid by individuals.

• A progressive tax is only paid by wealthy individuals, while a regressive tax is only paid by middle-class individuals.

Which of the following is NOT a characteristic of a market economy?

• Private property rights

• Profit motive

• Central planning by the government

• Competition

What is the difference between nominal GDP and real GDP?

• Nominal GDP is adjusted for inflation, while real GDP is not.

• Real GDP is adjusted for inflation, while nominal GDP is not.

• Nominal GDP includes only goods and services produced domestically, while real GDP includes both domestic and foreign production.

• Real GDP includes only goods and services produced domestically, while nominal GDP includes both domestic and foreign production.

Which of the following is an example of a positive externality?

• Pollution from a factory

• Education

• Traffic congestion

• Noise pollution from construction

What is the difference between a quota and a tariff?

• A quota is a tax on imported goods, while a tariff limits the amount of goods that can be imported.

• A quota limits the amount of goods that can be imported, while a tariff is a tax on imported goods.

• A quota is only used for agricultural products, while a tariff is used for all types of goods.

• A quota is set by the exporting country, while a tariff is set by the importing country.

Which of the following is NOT a characteristic of a command economy?

• Central planning by the government

• Limited consumer choice

• Private ownership of property

• Little or no competition

Which of the following is NOT a characteristic of oligopoly?

• Few sellers in the market

• High barriers to entry

• Homogeneous products

• Interdependence among firms