ECS1601 FINAL EXAM QUESTIONS
WITH VERIFIED SOLUTIONS 100%
VERIFIED 2025!! | ALREADY GRADED A+
Which of the following is/are correct?
a) Households are confronted with unlimited wants, but with limited resources
with which to satisfy those wants
b) The scarcity of resources necessitate households to make choices - ✔✔both a
and b are correct
Which of the following is/are correct regarding the distinction between
macroeconomics and microeconomics?
a) The price of apples at the supermarket is an example of a macroeconomic
variable.
b) An increase in the general price level (inflation) in the economy is an example
of a macroeconomic variable. - ✔✔only b is correct
A flow variable is defined as a variable that is measured over a period. Which
one of the following variables is not an example of a flow variable?
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,[1] National income
[2] The balance on Sibahle's savings account
[3] Budget deficit
[4] Total production - ✔✔[2] The balance on Sibahle's savings account
Which of the following is not an acceptable intervention by the public sector in
a mixed economy?
[1] the provision of funds for public goods such as parks and streetlights
[2] regulation of the pricing behaviour of monopoly industries
[3] stabilisation of the economy during periods of economic instability
[4] regulation of the price increases that result from changes in patterns of
demand and supply in the competitive market - ✔✔[4] regulation of the price
increases that result from changes in patterns of demand and supply in the
competitive market
The factors of production in an economy are ...
[1] households, capital, land, entrepreneurship
[2] government, household, firms, natural resources
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,[3] natural resources (land), labour, capital, and entrepreneurship
[4] human capital, land, natural resources, technology - ✔✔[3] natural resources
(land), labour, capital, and entrepreneurship
Which of the following are the remuneration of the factors of production?
[1] natural resources, rent, interest, labour
[2] rent, salaries and wages, interest, profit
[3] households, land, profit, capital
[4] entrepreneur, firms, capital, labour - ✔✔[2] rent, salaries and wages,
interest, profit
In the circular flow of income and spending ...
[1] savings, imports, taxes are leakages, while investment, government
spending, exports are injections.
[2] imports, taxes, investments are leakages, while exports, investments,
government spending are injections.
[3] savings, exports, taxes area leakages, while imports, investments,
government spending are injections.
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©JOSHCLAY 2025/2026. YEAR PUBLISHED 2025.
, [4] savings, government spending, imports are leakages, while investments,
exports, taxes are injections. - ✔✔[1] savings, imports, taxes are leakages, while
investment, government spending, exports are injections.
In the circular flow of goods and services ...
[1] firms sell factors of production on the goods market.
[2] goods and services offered for sale on the goods market are purchased by
firms.
[3] households combine factors of production and produce consumer goods and
services.
[4] households offer factors of production in the factor market. - ✔✔[4]
households offer factors of production in the factor market.
What does the letters A, B, C and D in the figure represent?
a) A represents factors of production
b) B represents goods and services
c) C represents foreign sector
d) D represents spending by firm
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©JOSHCLAY 2025/2026. YEAR PUBLISHED 2025.
WITH VERIFIED SOLUTIONS 100%
VERIFIED 2025!! | ALREADY GRADED A+
Which of the following is/are correct?
a) Households are confronted with unlimited wants, but with limited resources
with which to satisfy those wants
b) The scarcity of resources necessitate households to make choices - ✔✔both a
and b are correct
Which of the following is/are correct regarding the distinction between
macroeconomics and microeconomics?
a) The price of apples at the supermarket is an example of a macroeconomic
variable.
b) An increase in the general price level (inflation) in the economy is an example
of a macroeconomic variable. - ✔✔only b is correct
A flow variable is defined as a variable that is measured over a period. Which
one of the following variables is not an example of a flow variable?
1|Page
©JOSHCLAY 2025/2026. YEAR PUBLISHED 2025.
,[1] National income
[2] The balance on Sibahle's savings account
[3] Budget deficit
[4] Total production - ✔✔[2] The balance on Sibahle's savings account
Which of the following is not an acceptable intervention by the public sector in
a mixed economy?
[1] the provision of funds for public goods such as parks and streetlights
[2] regulation of the pricing behaviour of monopoly industries
[3] stabilisation of the economy during periods of economic instability
[4] regulation of the price increases that result from changes in patterns of
demand and supply in the competitive market - ✔✔[4] regulation of the price
increases that result from changes in patterns of demand and supply in the
competitive market
The factors of production in an economy are ...
[1] households, capital, land, entrepreneurship
[2] government, household, firms, natural resources
2|Page
©JOSHCLAY 2025/2026. YEAR PUBLISHED 2025.
,[3] natural resources (land), labour, capital, and entrepreneurship
[4] human capital, land, natural resources, technology - ✔✔[3] natural resources
(land), labour, capital, and entrepreneurship
Which of the following are the remuneration of the factors of production?
[1] natural resources, rent, interest, labour
[2] rent, salaries and wages, interest, profit
[3] households, land, profit, capital
[4] entrepreneur, firms, capital, labour - ✔✔[2] rent, salaries and wages,
interest, profit
In the circular flow of income and spending ...
[1] savings, imports, taxes are leakages, while investment, government
spending, exports are injections.
[2] imports, taxes, investments are leakages, while exports, investments,
government spending are injections.
[3] savings, exports, taxes area leakages, while imports, investments,
government spending are injections.
3|Page
©JOSHCLAY 2025/2026. YEAR PUBLISHED 2025.
, [4] savings, government spending, imports are leakages, while investments,
exports, taxes are injections. - ✔✔[1] savings, imports, taxes are leakages, while
investment, government spending, exports are injections.
In the circular flow of goods and services ...
[1] firms sell factors of production on the goods market.
[2] goods and services offered for sale on the goods market are purchased by
firms.
[3] households combine factors of production and produce consumer goods and
services.
[4] households offer factors of production in the factor market. - ✔✔[4]
households offer factors of production in the factor market.
What does the letters A, B, C and D in the figure represent?
a) A represents factors of production
b) B represents goods and services
c) C represents foreign sector
d) D represents spending by firm
4|Page
©JOSHCLAY 2025/2026. YEAR PUBLISHED 2025.
