Chapter 5 and 6

Which of the following is NOT considered an economic agent?

• Households

• Firms

• The government

• The environment

What is the main aim of private firms in an economy?

• To ensure low prices for consumers

• To maximise profit

• To provide public goods

• To regulate the economy

Which economic agent is responsible for regulating the private sector?

• Households

• Firms

• The government

• Banks

Which of the following statements best explains the connection between microeconomics and macroeconomics?

• Microeconomic decisions have no impact on macroeconomic outcomes.

• Macroeconomic decisions and microeconomic designs are the same.

• Microeconomic decisions may influence the macroeconomy

• All of the above

What does microeconomics study?

• The economy as a whole

• The behaviour and decisions of households and firms

• The behaviour of the government

• None of the above

Which of the following is NOT one of the three key allocation decisions?

• What to produce?

• How to produce it?

• How to distribute profits?

• Who is to receive the products produced?

Which of the following best describes a mixed economy?

• An economy where the government owns all resources 

• An economy where there is no private sector

• An economy where only the private sector exists

• An economy where both public and private sectors play important roles

Which economic system is also known as a free enterprise economy?

• Planned economy

• Market economy

• Mixed economy

• None of the above

Who typically decides what products are produced in a market economy?

• Consumers

• State-owned enterprises

• The government

• None of the above

In a market economy, how is the allocation of resources determined?

• Through the government

• By the price mechanism

• By social needs

• All of the above