REVISION MCQS

ECONOMICS 2281
GRADE 11

1) Which policy measure would be classified as a fiscal policy instrument?

A. A cut in the rate of interest
B. An increase in the money supply
C. The imposition of a quota
D. A rise in government spending on defense

2) What does a government’s budget position show?

A. How the exchange rate influences the country’s trade position
B. How the rate of interest influences the money supply
C. The relationship between export revenue and import expenditure
D. The relationship between government spending and tax revenue

3) What is a disadvantage of a progressive system of income tax?

A. It discourages the growth of the informal economy
B. It may increase the mobility of labor
C. It redistribution income from the poor to the rich
D. It may act as a disincentive to work

4) What effect is a supply-side policy measure designed to have on a country’s total (aggregate) supply
curve and production possibility curve (PPC)?
Total (AS) curve PPC
A. Decrease Decrease
B. Decrease Increase
C. Increase Increase
D. Increase Decrease

5) A country is experiencing a high rate of inflation. Which item would be the least desirable store of
wealth?
A. Money
B. Property
C. Land
D. Shares

6) What causes cost-push inflation?

A. A reduction in direct tax
B. A reduction in the rate of interest
C. An increase in bank lending
D. An increase in the price of raw material
7) Which government measure would be most effective in reducing structural unemployment?
A. Increase government spending on training
B. Increasing the rates of unemployment benefit
C. Reducing income tax
D. Reducing the rate of interest

8) Which of the following payments would be included in the measurement of gross domestic product?
A. Payments to those in the informal sector
B. Retirement pensions
C. Salaries of government ministers
D. Unemployment benefit

9) Which changes to debit and the value of money are the consequences of deflation?

Debt Value of money

A Decrease Decrease

B Decrease Increase

C Increase Increase

D Increase Decrease

10: which combination of changes may enable an economy to grow despite a rise in unemployment?

Occupational mobility Productivity

A Decrease Decrease

B Decrease Increase

C Increase Increase

D Increase Decrease

11: an increase in which variable may cause unemployment?

A. Bank lending
B. Disposable income
C. Government spending
D. Imports
12: why might a fall in unemployment increase the inflation?

A. It will increase total (aggregate) demand

B. It will increase total (aggregate) supply
C. It will reduce workers’ wages
D. It will reduce the economy’s productive capacity

13:What impact will economic development have on adult literacy, infant mortality and life expectancy?

Adult literacy Infant mortality Life expectancy

A Reduce Reduce Increase
B Increase Reduce Reduce
C Increase Increase Reduce
D Reduce Increase Increase

14: two countries have the same size of population. One country has a lower number of hospital beds
per 100,000 people, but is considered to have a better standard of healthcare. What could explain this?

A. Life expectancy is lower in this country

B. Patients are treated more efficiently in this country
C. This country has fewer doctors per 100,000 people
D. This country is more prone to infectious diseases

15: what would indicate that a country is experiencing economic development?

A. A fall in death rate

B. A fall in saving rate
C. A rise in its economic activity rate
D. A rise in its malnutrition rate

16: As an economy develops, what usually happens to the population of workers employed in the
primary and tertiary sector?

Primary Tertiary

A Decrease Decrease

B Decrease Increase

C Increase Increase

D Increase Decrease
17: which of the following may be a barrier to economic growth?

A. A reluctance to lower the school leaving age

B. A resistance to change
C. A high level of investment
D. A high level of productivity

18: How is health care measured in HDI?

A. Doctors per head of population

B. Government spending on healthcare
C. Hospital waiting lists
D. Life expectancy

19: A country has lower GDP per head than another country but a also a smaller percentage of people
living in absolute poverty. What could explain this?

A. The country has a lower rate of inflation

B. The country has a lower population
C. The country has a more even distribution of income
D. The country has more people employed in the primary sector

20: Which of the following may increase the birthrate in a country?

A. Improved healthcare
B. A rise in school leaving age
C. Reduced job opportunities for women
D. The introduction of a generous state pension scheme

21: which form of foreign aid is most likely to be successful in promoting economic development?

A. Tied, bilateral aid

B. Tied, multilateral aid
C. Untied, bilateral aid
D. Untied, multilateral aid

22: what could leads to virtuous cycle

A. Low savings
B. Low tax revenues
C. High imports
D. High productivity

23: a country has a low real GDP per head. What must this mean?

A. Everyone in the country is poor

B. Government spending on welfare benefits is high
 C. On average income levels are los
D. There are no millionaires living in country

24: What would increase the ratio of males to females in country?

A. A fall in death rate of males

B. A reduction in infanticides of female babies
C. A rise in emigration of males
D. A rise in immigration of females

25: why might a poor developing country experience net immigration?

A. It has a high and rising unemployment rate

B. It has a low and declining real GDP per head
C. It is surrounded by poorer countries
D. It is surrounded by countries with more lenient immigration controls

26: why may a rich developed country have a declining labor force?

A. It may have experienced a falling birth rate

B. It may have experienced a falling death rate
C. It may have experienced net immigration
D. It may have reduced the retirement age

27: which policy measures would increase the absolute and relative poverty?

A. A cut in state benefits

B. A cut in direct taxes
C. An increase in government spending on state education
D. An increase in government spending on state healthcare

28: A country has low GDP per head, low productivity, a high level of international debt and is
experiencing a natural increase in population. Which feature may be found in such country?

A. A death rate which is exceeding the birth rate

B. A net inflow of interest payments on past debts
C. High output per worker hour
D. Some households with high level of income

29: A country experiences a fall in its HDI despite a rise in life expectancy. What could explain this?

A. A fall in access to clean water

B. A fall in mean years of education
 C. A rise in air pollution
D. A rise in gender inequality

30: what is meant by optimum population?

A. A population which produces the higher output per head

B. A population with an equal number of males and females
C. A population which is static
D. A population with a low average age