ECONOMICS – REVIEW TEST

1. Another word for the word “fundamental” is

A. Option
B. Basic
C. Choice
D. Occupation
2. What is meant by “land”?
A. Labour resources
B. Natural resources
C. Human resources
D. Capital goods
3. Physical objects that can be purchased such as food, clothes, furniture…
A. Services
B. Demand
C. Goods
D. Wants
4. Which of the following statements is correct?
A. Only workforce have the problem of scarcity.
B. Supply refers to people’s needs for goods and services.
C. We can apply the concept of oppotunity cost to time.
D. Opportynity cost is the value of all alternatives that have not been chosen.
5. The closest meaning of the word “finite” is
A. Unlimited
B. Endless
C. Limited
D. Indefinite
6. ___________means that human wants for goods, services and resources exceed what is avaiable.
A. Supply
B. Demand
C. Scarcity
D. Shortage
7. The real cost of any economic decision is
A. Price
B. Needs
C. Wants
D. Opportunity cost
8. Which of the following is NOT included in the study of economics?
A. Scare resources
B. Choices
C. What people should buy
D. Opportunity cost
9. According to the meaning of opportunity cost, what is sacrificed when a decision is taken?
A. An identical alternative
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ECONOMICS – REVIEW TEST

B. Any alternative
C. The least valuable alternative
D. The next best alternative
10. Production can be defined as:
A. Any activity that brings working oppotunities to people.
B. Any activity that makes and sells goods and services
C. Any activity that is designed to satisfy wants
D. Any activity that makes a profit
1. Standard of living
11.The percentage increase in the economy’s output from quarter to quarter is ……
a. Real GDP
b. Nominal GDP
c. GDP Per Capita
d. GDP Growth Rate
12.The income that a government or company receives regularly is called ……
a. Revenue
b. Profit
c. Output
d. Input
13.It is said that industrialized countries should reduce the enormous …… of oil to protect the environment.
a. Price
b. Consumption
c. Exchange
d. Decrease
14.Both GDP and GNP are …… of a nation’s economic output.
a. Use
b. Production
c. Total
d. Measurement
15.The difference between a country’s total value of exports and total value of imports is ……
a. Taxation
b. Restriction
c. Net value
d. Net exports
16.Which is not close in meaning with “False”?
a. Invalid
b. Deceptive
c. Accurate
d. fraudulent
17.Which is antonym of “add”?
a. Subtract
b. Enlarge
c. Raise
d. Grow
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ECONOMICS – REVIEW TEST

18.Payments to suppliers, employee wages, factory leases, and equipment depreciation are examples of ……
a. Expense
b. Price deflator
c. Production output
d. Income
19.…… is an increase in the general level of prices.
a. Deflation
b. Inflation
c. Interdependence
d. Investment
20.A(n)……………………….is a very deep and prolonged recession.
A. depression
B. inflation
C. trough
D. downturn
21.Choose the fators affect the business cycle:
A. Investment, current interest rates, optimism and outside sources.
B. Investment, inflation, pessimistic and outside sources.
C. Positive sources, current interest rates, optimism and inflation
D. Current interest rates, optimism, outside sources and inflation.
22.Growth is characterized as higher………………………, lower unemployment and higher profits for
businesses.
A. investment
B. consumers
C. household income
D. revenue
23.Business cycle is the…………………..but irregular up – and – donw movements in economic activity,
measured by fluctuations in real GDP and other macroeconomic variables.
A. periodic
B. fluent
C. frequent
D. rare
24.Which of the following is not a synonym for optimism
A. Hopefulness
B. Postivism
C. Pessimism
D. Brightness
25.Which of the following is not a synonym for fluctuation
A. Stability
B. Variation
C. Inconstancy
D. Change
26.……………………..is a time at which a decisive change in a situation occur, especially one with beneficial
results.
A. Turning point
B. Fiscal year
C. Fluctuation
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ECONOMICS – REVIEW TEST

D. Movement
27.The trough of a business cycle occurs when………………….. hits its lowest point.
A. inflation
B. the money supply
C. aggregate economic activity
D. the unemployment rate
28.A…………………. occurs when the real GDP reaches its maximum, stops rising and begins to decline.
A. trough
B. contraction
C. expansion
D. peak
29.After the downturn reaches the bottom and economic conditions begin to improve, the economy enters the
…………………….phase of the cycle.
A. peak
B. expansion
C. contraction
D. Trough
30.In economics, demand is formally defined as 'effective' demand meaning that it is a consumer want or a need
supported by a(n) ……………….- namely a budget derived from disposable income.
A. desire to pay B. willingness to pay
C. plan to pay D. ability to pay
31.If, at a given quantity, the highest price that buyers are willing to pay is equal to the lowest price that
………….. are willing to accept, we say the market has reached its equilibrium quantity
A. demanders B. sellers
C. economists D. buyers
32.As the price rises, the quantity demanded decreased while the quantity supplied increases, that is how
price………………… can eliminate a shortage.
A. level B. adaptation
C. adjustments D. deflator
33. People come to expect that the price of a gallon of gasoline will rise next week. As a result, today’s demand
for gasoline ……………..
A. remain the same B. declines
C. increases D. Fluctuate
34.Choose the correct term for the following definition: The amount of good and service consumers is willing
and able to purchase.
A. Supply B. Quantity demanded
C. Demand D. Quantity
35.Choose the correct term for the following definition: A term used in economics to describe the total amount
of a good or service that consumers demand over a given interval of time at a certain price
A. Supply B. Quantity demanded
C. Demand D. Quantity
36.Choose the correct term for the following definition: A fall in price will lead to a decrease the quantity
supplied and an increase in price will lead to an increase in the quantity supplied, if all the other variables are
held constant
A. The law of demand B. The law of supply
C. The nature of market D. The law of market
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ECONOMICS – REVIEW TEST

37. Choose the correct term for the following definition: The higher the price of a good, the lower the quantity
demanded will be, the lower the price, the more goods will be in demand
A. The law of supply B. The law of demand
C. The nature of market D. The law of market
38. Choose the correct term for the following definition: The amount of goods and services producer is willing
to supply when receiving a particular price
A. Quantity supplied B. Supply
C. Quantity demanded D. Demand
39.Choose the correct term for the following definition: The amount of goods and services producer is willing
to supply at each price
A. Quantity supplied B. Supply
C. Quantity demanded D. Demand
40………………refers to the interest rate charged to the commercial banks and other financial institutions for
the loans they take from the Federal Reserve Bank through the discount window loan process.
A. The income
B. The profit
C. The interest rate
D. The discount rate
41.A(n) ……………….can be defined as a state of an economy in which growth is slow, flat or declining.
A. sluggish economy
B. natural disater
C. economic expansion
D. economic growth
42.When the economy is maintained at a certain rate, we say that it is in a ……………….
A. shortage condition
B. sustainable level
C. susplus condition
D. equilibrium condition
43.………………… are designed to protect citizens from the economic risks and insecurities of life in order to
promote the pursuance of work, education or a better standard of living.
A. Welfare programs
B. Training programs
C. Investment policies
D. Education policies
44.What is the term for this definition: “ the work of building such things as roads, schools, and reservoirs,
carried out by the government for the community
A. Welfare program
B. Transport system
C. Public service
D. Public works
45.Which of the following does fiscal policy directly affect?
A. Unemployment rate
B. Interest rate
C. Birth rate
D. Reserve requirement rate

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ECONOMICS – REVIEW TEST

46……………………..is a profit oriented financial institution and operates under the direct control and
supervision of the central bank.
A. The head quarter
B. Member bank
C. Commercial bank
D. The company location.
47. There can be only one ……………………..for the entire economy and it is also known as non-profit
making financial institution with the monopoly power to issue money.
A. Headquarter
B. commercial bank
C. company location
D. central bank
48. Fiscal policy can be defined as the ……………………..to influence an economy through the use of taxation
and government spending.
A. fiscal policy
B. monetary policy
C. government policy
D. company policy
49. Fiscal policy can be used in order to either to stimulate or to slow down an economy and it affects the
…………………….of an economy.
A. quantity demanded
B. aggregate demand
C. consumer demand
D. law of demand
50. The level of wealth, comfort, material goods and necessities available to a certain socioeconomic class in a
certain geography area is ……
a. Standard of living
b. Currency
c. Market price
d. Economic indicator