Question 4
Started on Monday, 4 May 2026, 8:07
AM
State Finished
Completed on Monday, 4 May 2026, 8:46
AM
Time taken 38 mins 39 secs
Marks 47.00/50.00
Grade 94.00 out of 100.00
Question 1
Complete
Mark 1.00 out of 1.00
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Question text
A business increases wages for its
workers. Based on the simple circular flow
model, what is the most likely short-term
effect on the economy?
Households will decrease their spending
on goods and services.
Households will stop supplying labour to
firms.
Firms will receive more revenue as
households increase spending.
The government will need to intervene to
control inflation.
Feedback
Higher wages increase household income,
increasing consumer spending on goods
and services. This increases firms’
revenue, reinforcing the circular flow of
income between households and firms.
Question 2
Complete
Mark 0.00 out of 1.00
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Question text
Which of the following represents a
nominal (money) flow in a simple
economy?
,A worker supplying labour to a firm.
A household spending money on
groceries.
A household saving money in a bank
account.
A firm producing goods and services.
Feedback
A nominal flow is a monetary transaction.
In this case, the household is spending
money (a nominal flow) to acquire goods
(a real flow).
Question 3
Complete
Mark 1.00 out of 1.00
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Question text
A significant increase in consumer
demand leads to firms hiring more
workers to expand production. How would
this change impact the goods market and
factor market in the short term?
The goods market will become
oversaturated with products, leading to
lower prices, and the factor market will
experience a decline in labour supply.
The goods and factor markets will remain
unchanged because firms only respond to
consumer preferences.
The goods market will see reduced prices
due to increased production, while the
factor market will experience a decrease
in labour demand.
The goods market will experience higher
prices due to increased demand, and the
factor market will experience an increase
in labour demand.
Feedback
Increased consumer demand drives firms
to produce more, potentially raising prices
in the goods market if supply can't keep
up.
, To meet demand, firms hire more labour
in the factor market, increasing labour
demand.
Question 4
Complete
Mark 1.00 out of 1.00
Flag question
Question text
If a country's Gross Domestic Product (the
total value of all goods and services
produced in a country during a specific
period of time), or GDP, increases by 5%
over a year, which of the following best
describes this change?
A decrease in the flow of government
spending.
A decrease in the stock of national debt.
An increase in the stock of national wealth.
An increase in the flow of economic
output.
Feedback
GDP (Gross Domestic Product) is a flow
measure because it represents the total
value of goods and services produced
over a period of time (usually a year). An
increase in GDP indicates an increase in
the flow of economic output.
Question 5
Complete
Mark 1.00 out of 1.00
Flag question
Question text
The three major flows in the economy are
total production, total income and total
spending.
TRUE
FALSE
Feedback
The statement is true.
Started on Monday, 4 May 2026, 8:07
AM
State Finished
Completed on Monday, 4 May 2026, 8:46
AM
Time taken 38 mins 39 secs
Marks 47.00/50.00
Grade 94.00 out of 100.00
Question 1
Complete
Mark 1.00 out of 1.00
Flag question
Question text
A business increases wages for its
workers. Based on the simple circular flow
model, what is the most likely short-term
effect on the economy?
Households will decrease their spending
on goods and services.
Households will stop supplying labour to
firms.
Firms will receive more revenue as
households increase spending.
The government will need to intervene to
control inflation.
Feedback
Higher wages increase household income,
increasing consumer spending on goods
and services. This increases firms’
revenue, reinforcing the circular flow of
income between households and firms.
Question 2
Complete
Mark 0.00 out of 1.00
Flag question
Question text
Which of the following represents a
nominal (money) flow in a simple
economy?
,A worker supplying labour to a firm.
A household spending money on
groceries.
A household saving money in a bank
account.
A firm producing goods and services.
Feedback
A nominal flow is a monetary transaction.
In this case, the household is spending
money (a nominal flow) to acquire goods
(a real flow).
Question 3
Complete
Mark 1.00 out of 1.00
Flag question
Question text
A significant increase in consumer
demand leads to firms hiring more
workers to expand production. How would
this change impact the goods market and
factor market in the short term?
The goods market will become
oversaturated with products, leading to
lower prices, and the factor market will
experience a decline in labour supply.
The goods and factor markets will remain
unchanged because firms only respond to
consumer preferences.
The goods market will see reduced prices
due to increased production, while the
factor market will experience a decrease
in labour demand.
The goods market will experience higher
prices due to increased demand, and the
factor market will experience an increase
in labour demand.
Feedback
Increased consumer demand drives firms
to produce more, potentially raising prices
in the goods market if supply can't keep
up.
, To meet demand, firms hire more labour
in the factor market, increasing labour
demand.
Question 4
Complete
Mark 1.00 out of 1.00
Flag question
Question text
If a country's Gross Domestic Product (the
total value of all goods and services
produced in a country during a specific
period of time), or GDP, increases by 5%
over a year, which of the following best
describes this change?
A decrease in the flow of government
spending.
A decrease in the stock of national debt.
An increase in the stock of national wealth.
An increase in the flow of economic
output.
Feedback
GDP (Gross Domestic Product) is a flow
measure because it represents the total
value of goods and services produced
over a period of time (usually a year). An
increase in GDP indicates an increase in
the flow of economic output.
Question 5
Complete
Mark 1.00 out of 1.00
Flag question
Question text
The three major flows in the economy are
total production, total income and total
spending.
TRUE
FALSE
Feedback
The statement is true.
