EDEXCEL A-LEVEL ECONOMICS 1 EXAM QUESTIONS
WITH CORRECT ANSWERS(A+ GRADED).
1) Model -- Answer ✔✔ A theoretical concept that looks at how different variables
_ _ _ _ _ _ _ _ _ _ _ _ _
interact.
2) Ceteris Paribus -- Answer ✔✔ All other factors remain the same.
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3) Positive Statement -- Answer ✔✔ Objective, factually based comments that can be
_ _ _ _ _ _ _ _ _ _ _ _
tested.
4) Normative Statement -- Answer ✔✔ Subjective, questionable comments based on
_ _ _ _ _ _ _ _ _ _
valued judgements that are difficult to test.
_ _ _ _ _ _
5) Scarcity -- Answer ✔✔ When there are unlimited human wants but limited number
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_of resources to meet these wants.
_ _ _ _ _
6) Economic Problem -- Answer ✔✔ Making choices on how to allocate scarce
_ _ _ _ _ _ _ _ _ _ _ _
resources to best meet our needs and wants.
_ _ _ _ _ _ _
7) Renewable Resources -- Answer ✔✔ Can be replenished.
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8) Non-Renewable Resources -- Answer ✔✔ Finite supply, will run out.
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9) Sustainable Resources -- Answer ✔✔ Used for economic activities in such a
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manner they won’t run out.
_ _ _ _
10) Opportunity Cost -- Answer ✔✔ The benefit loss of the next best alternative when
_ _ _ _ _ _ _ _ _ _ _ _ _
_making a choice.
_ _
, 11) Production Possibility Frontier -- Answer ✔✔ A curve which represents all possible
_ _ _ _ _ _ _ _ _ _ _
_ combinations of goods an economy or a firm can produce when all factors of
_ _ _ _ _ _ _ _ _ _ _ _ _ _
production are fully employed and used efficiently.
_ _ _ _ _ _
12) Factors of Production -- Answer ✔✔ 1. Land
_ _ _ _ _ _ _
2. Labour
_
3. Capital
_
4. Enterprise
_
13) Productive Efficiency -- Answer ✔✔ When the economy uses minimum inputs to
_ _ _ _ _ _ _ _ _ _ _ _
produce maximum output at lower cost.
_ _ _ _ _
14) Allocative Efficiency -- Answer ✔✔ Social welfare is maximised in the production of
_ _ _ _ _ _ _ _ _ _ _ _
_goods and services.
_ _
15) Supply-Side Policy -- Answer ✔✔ Government attempt to productively increase
_ _ _ _ _ _ _ _ _ _
supply.
16) Capital Goods -- Answer ✔✔ Goods used to make consumer goods and services.
_ _ _ _ _ _ _ _ _ _ _ _
17) Consumer Goods -- Answer ✔✔ Goods and services that satisfy our needs.
_ _ _ _ _ _ _ _ _ _ _
18) Production -- Answer ✔✔ Measure of goods and services produced.
_ _ _ _ _ _ _ _ _
19) Productivity -- Answer ✔✔ Measure of efficiency of factors of production measured
_ _ _ _ _ _ _ _ _ _ _
_ by output per person employed or output per person hour.
_ _ _ _ _ _ _ _ _
20) Specialisation -- Answer ✔✔ Occurs when economic units focus on producing
_ _ _ _ _ _ _ _ _ _ _
specific goods or services.
_ _ _
21) Division of Labour -- Answer ✔✔ Specialised use of workers within an
_ _ _ _ _ _ _ _ _ _ _ _
organisation.
22) Economies of Scale -- Answer ✔✔ Buying in bulk and getting goods with deals
_ _ _ _ _ _ _ _ _ _ _ _ _ _
lowering the unit cost. _ _ _
WITH CORRECT ANSWERS(A+ GRADED).
1) Model -- Answer ✔✔ A theoretical concept that looks at how different variables
_ _ _ _ _ _ _ _ _ _ _ _ _
interact.
2) Ceteris Paribus -- Answer ✔✔ All other factors remain the same.
_ _ _ _ _ _ _ _ _ _
3) Positive Statement -- Answer ✔✔ Objective, factually based comments that can be
_ _ _ _ _ _ _ _ _ _ _ _
tested.
4) Normative Statement -- Answer ✔✔ Subjective, questionable comments based on
_ _ _ _ _ _ _ _ _ _
valued judgements that are difficult to test.
_ _ _ _ _ _
5) Scarcity -- Answer ✔✔ When there are unlimited human wants but limited number
_ _ _ _ _ _ _ _ _ _ _ _
_of resources to meet these wants.
_ _ _ _ _
6) Economic Problem -- Answer ✔✔ Making choices on how to allocate scarce
_ _ _ _ _ _ _ _ _ _ _ _
resources to best meet our needs and wants.
_ _ _ _ _ _ _
7) Renewable Resources -- Answer ✔✔ Can be replenished.
_ _ _ _ _ _ _
8) Non-Renewable Resources -- Answer ✔✔ Finite supply, will run out.
_ _ _ _ _ _ _ _ _
9) Sustainable Resources -- Answer ✔✔ Used for economic activities in such a
_ _ _ _ _ _ _ _ _ _ _ _
manner they won’t run out.
_ _ _ _
10) Opportunity Cost -- Answer ✔✔ The benefit loss of the next best alternative when
_ _ _ _ _ _ _ _ _ _ _ _ _
_making a choice.
_ _
, 11) Production Possibility Frontier -- Answer ✔✔ A curve which represents all possible
_ _ _ _ _ _ _ _ _ _ _
_ combinations of goods an economy or a firm can produce when all factors of
_ _ _ _ _ _ _ _ _ _ _ _ _ _
production are fully employed and used efficiently.
_ _ _ _ _ _
12) Factors of Production -- Answer ✔✔ 1. Land
_ _ _ _ _ _ _
2. Labour
_
3. Capital
_
4. Enterprise
_
13) Productive Efficiency -- Answer ✔✔ When the economy uses minimum inputs to
_ _ _ _ _ _ _ _ _ _ _ _
produce maximum output at lower cost.
_ _ _ _ _
14) Allocative Efficiency -- Answer ✔✔ Social welfare is maximised in the production of
_ _ _ _ _ _ _ _ _ _ _ _
_goods and services.
_ _
15) Supply-Side Policy -- Answer ✔✔ Government attempt to productively increase
_ _ _ _ _ _ _ _ _ _
supply.
16) Capital Goods -- Answer ✔✔ Goods used to make consumer goods and services.
_ _ _ _ _ _ _ _ _ _ _ _
17) Consumer Goods -- Answer ✔✔ Goods and services that satisfy our needs.
_ _ _ _ _ _ _ _ _ _ _
18) Production -- Answer ✔✔ Measure of goods and services produced.
_ _ _ _ _ _ _ _ _
19) Productivity -- Answer ✔✔ Measure of efficiency of factors of production measured
_ _ _ _ _ _ _ _ _ _ _
_ by output per person employed or output per person hour.
_ _ _ _ _ _ _ _ _
20) Specialisation -- Answer ✔✔ Occurs when economic units focus on producing
_ _ _ _ _ _ _ _ _ _ _
specific goods or services.
_ _ _
21) Division of Labour -- Answer ✔✔ Specialised use of workers within an
_ _ _ _ _ _ _ _ _ _ _ _
organisation.
22) Economies of Scale -- Answer ✔✔ Buying in bulk and getting goods with deals
_ _ _ _ _ _ _ _ _ _ _ _ _ _
lowering the unit cost. _ _ _
