A Level Economics Quiz 2018 Part 3

20 Questions

Quiz Description

Pual A. Samuelson defined economics as the study of how societies use scarce resources to produce valuable commodities and distribute them among different people.

Students are always puzzled when someone has a good grade. The key to having a good grade is answering past question papers, especially the most recent years. It’s simply the best way to prepare for an exam being official or not official, because you can now examine if you have a mastery of the syllabus, how questions are being asked and most importantly where you are lacking. So, in our own way to help you out with this, we have chosen a recent year, June 2018 A-level Economics paper to help test your preparedness. We have set a quiz of 20 questions, with each question having four possible answers.

Bear in mind that you’re dealing with MCQs, each answer is similar to the next. So, take your time to understand each question before proposing your answer.At the end of this quiz, we have also prepared another session of quiz which is made up of 15 questions. For more questions click more or you can also visit our website

1:

The Table 3 shows a country’s consumption at different levels of national income.

What is the savings function?


<p>The Table 3 shows a country’s consumption at different levels of national income. </p><p> What is the savings function? </p>
Correct
  • 1:
    S = 600 million + 0.3Y
  • 2:
    S = -600 million + 0.3Y
  • 3:
    S = -600 million + 0.7Y
  • 4:
    S = 600 million + 0.7Y
2:

In a closed economy without any government, the savings function is given by S=
-50 + 0.4Y. If the national income is 500, calculate the average propensity to consumption


Correct
  • 1:
    0.1
  • 2:
    0.3
  • 3:
    0.5
  • 4:
    0.7
3:

The power of issuing bank notes in Cameroon is confined to:


Correct
  • 1:
    BICEC
  • 2:
    UBC
  • 3:
    NFC
  • 4:
    BEAC
4:

The total amount of money the banking system can create with an initial deposit of
100,000 FCFA and a legal reserve ratio of 25% is:


Correct
  • 1:
    125,000 FCFA
  • 2:
    300,000 FCFA.
  • 3:
    400,000 FCFA.
  • 4:
    500,000 FCFA.
5:

What relationship exists between the speculative demand for money and the
transactions demand for money?


Correct
  • 1:
    They are independent.
  • 2:
    They have a direct relationship
  • 3:
    They have an indirect relationship.
  • 4:
    They are concerned with active balances.
6:

Figure 7 relates to the amount of tax paid in relation to different levels of income.

Which tax system is represented by this diagram?


<p>Figure 7 relates to the amount of tax paid in relation to different levels of income.</p><p> Which tax system is represented by this diagram? </p>
Correct
  • 1:
    Proportional system
  • 2:
    Proportional system
  • 3:
    Regressive system
  • 4:
    Direct tax system
7:

________involves deliberate actions by the government to stabilize the economy by spending on goods and services and changing the rate of taxes.


Correct
  • 1:
    Discretionary fiscal policy
  • 2:
    Discretionary monetary policy
  • 3:
    Discretionary monetary policy
  • 4:
    Fiscal policy
8:

An individual earns 200,000 FCFA and has a tax allowance of 40,000 FCFA. If he pays a tax of 20%, his average rate of tax would be:


Correct
  • 1:
    10%
  • 2:
    16%
  • 3:
    20%
  • 4:
    40%
9:

Which of the following is a measure of solving a balance of payments deficit in the
long run?


Correct
  • 1:
    Exporting gold.
  • 2:
    Selling foreign investment;
  • 3:
    Export promotion
  • 4:
    Borrowing from the IMF.
10:

The exchange rate system practiced by the countries of the franc CFA zone and the
European Union is known as:


Correct
  • 1:
    the floating exchange rate system
  • 2:
    the managed exchange rate system
  • 3:
    the adjustable peg system
  • 4:
    the pegged exchange rate system
11:

You are given the following data on acountry’s trade transactions. Figures are in million FCFA

Visible imports 550

Balance of trade 750

Invisibl balance 1,000

Net transactions in assets and liabilities 400.

What is the value of visible exports?


Correct
  • 1:
    200 million FCFA.
  • 2:
    250 million FCFA
  • 3:
    1,300 million FCFA
  • 4:
    1,750 million FCFA.
12:

The Table shows the output per unit of input of two goods produced by two countries.

It can be concluded that:


<p>The Table shows the output per unit of input of two goods produced by two countries. </p><p> It can be concluded that: </p>
Correct
  • 1:
    country X- has a comparative advantage in food
  • 2:
    country Y has a comparative advantage in clothing
  • 3:
    country Y has an absolute advantage in both goods
  • 4:
    country X has an absolute advantage in both goods and a comparative advantage in clothing.
13:

At what phase of the trade cycle would one expect the marginal propensity to
consume in an economy be highest?


Correct
  • 1:
    Boom
  • 2:
    Recession
  • 3:
    Depression
  • 4:
    Recovery
14:

1. This question is based on the
following:

(i) Reducing the minimum amount necessary to open a bank account.

(ii) Allowing political instability

(iii) Increasing incomes

How can savings be mobilised for growth to take place in an economy?


Correct
  • 1:
    (i) only
  • 2:
    (i) and (ii) only
  • 3:
    (i) and (iii) only
  • 4:
    (i), (ii) and (iii)
15:

Which of the following will reduce regional unemployment?


Correct
  • 1:
    Devaluing of the currency.
  • 2:
    Government sponsoring retraining schemes in affected area
  • 3:
    Stimulating aggregate demand in the economy.
  • 4:
    Regulating trade union activities
16:

If government spends 900 billion FCFA and raises 900 billion FCFA from taxation. This would cause national income to:


Correct
  • 1:
    increase by 900 billion FCFA.
  • 2:
    increase by 900 billion FCFA.
  • 3:
    fall by 900 billion FCFA.
  • 4:
    increase by 1,800 billion FCFA.
17:

Which of the following will result in an increase in demand?


Correct
  • 1:
    A fall in the price of the good.
  • 2:
    An increase in household tastes.
  • 3:
    A change in income.
  • 4:
    An increase in the price of a substitute good.
18:

Which of the following financial institutions controls the monetary policy in
Cameroon ?


Correct
  • 1:
    BEAC
  • 2:
    IMF
  • 3:
    BICEC
  • 4:
    D. Bank of France
19:

In perfect competition:


Correct
  • 1:
    a few firms dominate the industry
  • 2:
    firms are price maker
  • 3:
    there are many buyers and sellers
  • 4:
    there are many buyers but few sellers
20:

In a regressive tax system:


Correct
  • 1:
    The average tax rate falls as income increases
  • 2:
    The average tax rate is less than the marginal tax rate.
  • 3:
    The tax ratio paid increases as income increases.
  • 4:
    The tax ratio paid falls as income increases.

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A Level Economics Quiz 2018 Part 3
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