# A Level Economics Quiz 2020 Part 3

#### Quiz Description

Economics is simply a subject that explains how economics work and how economic agents interact. Economics isn’t just a set of technical words; it’s actually using them to develop a viable business strategy.

Once you understand the terms, it’s easier to use theories and frameworks. In a way to help out students understand these theories, quizzes have been prepared for students/people going in for one or two different examinations. We have created a quiz of 20 questions which are questions from Advance level Economics 2020. We insist on the point that it is integral for you (students) to go through the quiz till the end. Some of these questions are found on the topics ``economic growth, tax, income and so on……”

Just trying this quiz gives you the satisfaction of knowing what you encounter ahead. So, we urge you to try more quizzes. You can also visit our website to gain more materials Good luck!!!

This question is based on the table below showing a partial accelerator table for an economy with a capital-output ratio of 2:1. Depreciation is constant at a rate of 1000 units of capital per year.

What is the most appropriate reason why replacement investment in year 5 is zero? Correct
• Because of excess capacity of 2000
• Because of excess capacity of 1000
• Because demand has fallen by 1000
• Because required capital has fallen by 2000

This question is based on the formula below:

(change in consumption)/(change in disposable income)

The formula above is used for calculating:

Correct
• Average consumption
• Average propensity to consume
• Marginal consumption
• Marginal propensity to consume

If C=70 million FCFA + 0.7Y, where Y is income which of the following will stand for the saving function?

Correct
• S=30 million FCFA - 0.7Y
• S=30 million FCFA + 0.7Y
• S=-70 million FCFA + 0.3Y
• S=-70 million FCFA - 0.3Y

If the income of an unskilled individual is 0 FCFA and his consumption is 1300 FCFA, what will this amount of consumption be referred to?

Correct
• Induced consumption
• Relative consumption
• Autonomous consumption
• Current consumption

This question is based on the following formula:

1/(MPS)

The formula above seeks to calculate

Correct
• The accelerator
• The multiplier
• Average propensity to save
• Marginal propensity to save

It can be concluded that: Correct
• The standard of living has risen
• The rate of inflation has risen
• The cost of living has risen
• The value of money has fallen

To which group of customers below will BICEC bank Cameroon issue certificates of deposit?

Correct
• Medium term borrowing
• Long term borrowers
• Long term depositors
• Short term depositors

A hypothetical commercial bank keeps 20,000 FCFA after receiving 200,000 FCFA as deposit from a customer. The maximum additional deposit created is:

Correct
• 2,000,000 FCFA
• 1,800,000 FCFA
• 200,000 FCFA
• 180,000 FCFA

This question
is based on the formula below:

(ED)/(ES+ED) x AMOUNT OF TAX,

Where ED is the elasticity of demand and ES is the elasticity of supply.

The formula above best calculates the:

Correct
• Consumer’s share of tax
• Community’s share of tax
• Producer’s share of tax
• Government’s share of the tax

This question is based on the table below showing the tax structures in a number of countries.

In which of the above countries does the tax system respect the canon of vertical equity? Correct
• Country X
• Country W
• Country Y
• Country Z

XYZ enterprise succeeds in transferring one quarter of its indirect tax to its
customers. This implies that the demand for the product is: Correct
• Fairly elastic
• Fairly inelastic
• Perfectly elastic
• Perfectly inelastic

This question is based on the list below:

i. central government

ii. local governments

iii. public corporations

iv. public companies

the public sector consists of:

Correct
• i and ii
• i, ii and iii
• i, ii and iv
• i, ii and iv i, ii, iii and iv

If countries have different opportunity cost ratios, and their international terms of
trade (TOT) lie within limits set by domestic opportunity cost ratios, the countries will find it:

Correct
• Difficult to trade with each other
• Impossible to trade with each other
• Profitable to trade with each other

Which of the following is an immediate and unavoidable result of devaluation other things being equal?

Correct
• An unfavourable movement in the terms of trade
• A favourable movement in the terms of trade
• A favourable movement in the balance of trade
• An unfavourable movement in the balance of trade

If short term measures fail to cure a country’s balance of payments deficit, the best possible thing to do is to:

Correct
• Encourage exports
• Raise interest rates
• Sell its foreign assets

The J-curve effect explains that:

Correct
• Revaluation worsens BOP situation in the short run but improves in the long run
• Revaluation improves BOP situation in the short run but worsens in the long run
• Devaluation worsens BOP situation in the short run but improves in the long run
• Devaluation improves BOP situation in the short run but worsens in the long run

.

Correct
• Economic development occurs without economic growth
• Economic growth occurs after economic development
• Economic development cannot occur without economic growth
• Economic development cannot co-exist economic growth

Periodic fluctuations in economic activity most likely to reduce employment occur
during a:

Correct
• Slump
• Peak
• Recovery
• Boom

A country’s labour force includes all those who are economically active. Economically active refers to those who are:

Correct
• Willing to work
• Able to work
• Willing and unable to work
• Willing and able to work

The removal of government regulation that restrict entry and exit of firms and competition is called:

Correct
• Deregulation
• Denationalization
• Leasing
• Contracting out