Question 1

What is meant by 'allocation' in an economic system?

Accepted Answer

The process of distributing resources among various uses

Answer

A type of economic system

Answer

The measurement of economic growth

Answer

The total amount of resources available

Question 2

Which of the following is an example of a command economy?

Accepted Answer

A government decides what goods and services will be produced

Answer

Prices are determined by supply and demand

Answer

Consumers have full freedom to choose what to buy

Answer

Businesses operate without any government intervention

Question 3

What does the term 'market economy' refer to?

Accepted Answer

An economic system where decisions are made based on supply and demand

Answer

A form of economy that has no competition

Answer

An economy that relies solely on barter

Answer

A system where the government controls all production

Question 4

What is the primary function of an economic system?

Accepted Answer

To allocate resources effectively to meet the needs of society

Answer

To ensure political stability

Answer

To maintain a balance of nature

Answer

To maximize profits for businesses only

Question 5

In a mixed economy, how are decisions typically made?

Accepted Answer

Through a combination of government intervention and market forces

Answer

Solely by the government

Answer

By random selection

Answer

Completely by private individuals without regulation

Question 6

What is the role of prices in an economic system?

Accepted Answer

Prices act as signals to both consumers and producers

Answer

Prices are determined solely by the government

Answer

Prices have no impact on supply and demand

Answer

Prices are fixed and do not change

Question 7

What is scarcity in economics?

Accepted Answer

The limited availability of resources compared to unlimited wants

Answer

The abundance of resources available for all

Answer

A situation where all resources are free

Answer

A government policy to control production

Question 8

Which of the following best describes 'opportunity cost'?

Accepted Answer

The value of the next best alternative that is forgone

Answer

A type of financial penalty

Answer

The total cost of a decision

Answer

The profit made from a trade

Question 9

What is the purpose of government intervention in a market economy?

Accepted Answer

To correct market failures and provide public goods

Answer

To eliminate all forms of competition

Answer

To increase consumer choices

Answer

To set prices for all goods and services

Question 10

What is meant by 'economic efficiency'?

Accepted Answer

The optimal allocation of resources to maximize output

Answer

A situation where everyone has equal wealth

Answer

The ability to produce goods without any costs

Answer

The state of having no waste in production

Related quizzes

Related quizzes