G.10 - Economics Unit 1: Exam Preparation

Which of the following is an example of a normative statement?

• The unemployment rate is currently 5%.

• Inflation has been consistent at 2% annually.

• GDP growth was 3% last quarter.

• Government spending should increase to reduce unemployment.

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

• A private school

• A national defense system

• A coffee shop

• A personal computer

Which factor of production is most associated with human skills and talents?

• Land (Natural Resources)

• Labor (Human Resources)

• Enterprise

• Capital (Human-Made Resources)

Which of the following best describes a market economy?

• All economic decisions are made by the government.

• Resources are allocated by market forces without government intervention.

• Public goods are provided solely by private firms.

• All firms are owned by the state.

Which sector is directly involved in the extraction of raw materials?

• Primary sector

• Secondary sector

• Tertiary sector

• Quaternary sector

A new report shows that Country Y's economy is heavily reliant on its mining industry, which accounts for 40% of its GDP. However, the government wants to diversify the economy by promoting tourism and financial services. By promoting tourism and financial services, which sectors does the government aim to expand?

• Primary and Secondary sectors

• Tertiary and Quaternary sectors

• Secondary and Tertiary sectors

• Primary and Quaternary sectors

A new report shows that Country Y's economy is heavily reliant on its mining industry, which accounts for 40% of its GDP. However, the government wants to diversify the economy by promoting tourism and financial services. Currently, which economic sector dominates Country Y's economy?

• Primary sector

• Secondary sector

• Tertiary sector

• Quaternary sector

Liam owns a bakery in a small town and sells cakes and bread. Recently, he received a grant from the local government to upgrade his baking equipment. This allows him to produce more cakes and bread at a lower cost. Additionally, he hires a marketing team to increase his sales through social media.

Which factor of production was enhanced by upgrading the baking equipment?

• Labor (Human Resources)

• Land (Natural Resources)

• Enterprise

• Capital (Human-Made) Resources)

Liam owns a bakery in a small town and sells cakes and bread. Recently, he received a grant from the local government to upgrade his baking equipment. This allows him to produce more cakes and bread at a lower cost. Additionally, he hires a marketing team to increase his sales through social media. If Liam wants to focus solely on cakes due to higher demand, what economic concept is he using?

• Division of Labor

• Specialization

• Economic growth

• Productivity

Which of the following statements is positive rather than normative?

• Everyone should have access to free healthcare.

• A cut in income tax will lead to higher consumer spending.

• The government ought to focus more on renewable energy.

• The country should adopt a flat tax system to simplify taxation.