Question 1

Which of the following would indicate that markets are operating efficiently?

Accepted Answer

A)  Consumer sovereignty is being achieved 
B)  Firms are making a high level of profits 
C)  There is a constant rise in the money value of goods and services 
D)  Incomes are distributed equally across all people 
A)  Consumer sovereignty is being achieved 
B)  Firms are making a high level of profits 
C)  There is a constant rise in the money value of goods and services 
D)  Incomes are distributed equally across all people A

Question 2

As incomes rise we would expect there be a greater percentage of this spent on services than on primary goods.

Accepted Answer

A) True 
 B)False  True

Question 3

Explain why there was a widespread adoption of neoclassical and neoliberal policies across the global economy from the mid 1970s onwards. What are seen as the main weaknesses of this approach to economic policy?

Accepted Answer

Explain the context in which neoclassical policy came to prominence in the mid 1970s (i.e. the perceived failure of the Keynesian welfare consensus in the 'first world' and the collapse of communism in the 'second world', as opposed to the success of the Asian economies).
Explain the main features of the neoclassical view (i.e. the belief in markets; this can be related back to the discussion of how-in theory-markets work).
The main arguments against this perspective (i.e. inequality and lack of financial regulation; again, this can be related back to the discussion about the potential problems of the free market).

Question 4

Which of the following is not universally accepted as being a reason for legitimate government policy?

Accepted Answer

A)  The provision of merit goods 
B)  The provision of public goods 
C)  The need to take account of externalities 
D)  Very high taxation rates on the richer members of society 
A)  The provision of merit goods 
B)  The provision of public goods 
C)  The need to take account of externalities 
D)  Very high taxation rates on the richer members of society

Question 5

Explain what is meant by the economic problem and show how economic efficiency relates to its three parts.

Accepted Answer

Describe the problem of scarcity-limited

Question 6

The basic economic problem is simply that we haven't got enough money to do all the things that we want.

Accepted Answer

A) True 
 B)False

Question 7

Which of the following are examples of an externality? Please select all that apply.

Accepted Answer

A)  The cost to a cigarette smoker of a packet of cigarettes 
B)  Noise levels for households who live near airports 
C)  The effect on the value of homes for existing homeowners of an increase in the reputation of schools in the neighbourhood 
D)  The cost of petrol to a motorist 
A)  The cost to a cigarette smoker of a packet of cigarettes 
B)  Noise levels for households who live near airports 
C)  The effect on the value of homes for existing homeowners of an increase in the reputation of schools in the neighbourhood 
D)  The cost of petrol to a motorist

Question 8

Which of the following are the most likely characteristics of a market which has a high degree of monopoly power? Please select all that apply.

Accepted Answer

A)  Prices will be high and allocative efficiency will not be evident 
B)  Productive efficiency will not be attained 
C)  The elasticity of demand for the product will be relatively inelastic 
D)  There will be very large profits 
A)  Prices will be high and allocative efficiency will not be evident 
B)  Productive efficiency will not be attained 
C)  The elasticity of demand for the product will be relatively inelastic 
D)  There will be very large profits

Question 9

Which of the following activities in the supply chain for automobiles is an example of a service activity?

Accepted Answer

A)  Production of the rubber for the tyres 
B)  The production of the tyres themselves 
C)  The assembly of all the car components into a finished motor car 
D)  The selling of the car through a motor sales dealership 
A)  Production of the rubber for the tyres 
B)  The production of the tyres themselves 
C)  The assembly of all the car components into a finished motor car 
D)  The selling of the car through a motor sales dealership

Question 10

If there was a shortage in a particular market, which of the following is least likely to happen if the market is allowed to operate freely? Please select all that apply.

Accepted Answer

A)  A permanent black market would form 
B)  Prices would rise to choke off the excess demand 
C)  In the long run supply would increase to eradicate the shortage 
D)  Prices will fall 
A)  A permanent black market would form 
B)  Prices would rise to choke off the excess demand 
C)  In the long run supply would increase to eradicate the shortage 
D)  Prices will fall

Question 11

Economic efficiency has to encompass the three parts to the economic problem.

Accepted Answer

A) True 
 B)False

Question 12

Which of the following businesses can be best described as being in the primary sector? Please select all that apply.

Accepted Answer

A)  A farm 
B)  An oil rig 
C)  A supermarket 
D)  A bank 
A)  A farm 
B)  An oil rig 
C)  A supermarket 
D)  A bank

Question 13

If as a result of a 5 per cent rise in price demand falls by 10 per cent, which of the following statements is correct? Please select all that apply.

Accepted Answer

A)  The price elasticity of demand is elastic 
B)  The price elasticity of demand is −2 
C)  The revenue for the firm will fall 
D)  It is likely that the firm is operating in an uncompetitive market 
A)  The price elasticity of demand is elastic 
B)  The price elasticity of demand is −2 
C)  The revenue for the firm will fall 
D)  It is likely that the firm is operating in an uncompetitive market

Question 14

The opportunity cost of an individual's decision to allocate a fixed amount of resources to an activity is best described as:

Accepted Answer

A)  The value to the individual of that activity 
B)  The costs to society of that activity 
C)  The value of the next best activity forgone 
D)  The monetary costs of that activity 
A)  The value to the individual of that activity 
B)  The costs to society of that activity 
C)  The value of the next best activity forgone 
D)  The monetary costs of that activity

Question 15

Assume that a person has sufficient resources to consume either A, B, or C, and chooses C. The opportunity cost of C is A and B.

Accepted Answer

A) True 
 B)False

Question 16

If the demand for a good is relatively price elastic and its price falls the revenue will:

Accepted Answer

A)  Fall 
B)  Remain constant 
C)  Rise 
D)  None of the above 
A)  Fall 
B)  Remain constant 
C)  Rise 
D)  None of the above

Question 17

If revenue from sales of a product increases as a result of an increase in price, then the price elasticity of demand for the product must be relatively inelastic.

Accepted Answer

A) True 
 B)False

Question 18

Explain what is meant by the term 'price elasticity of demand', and show with examples how differences in the price elasticity of demand faced by firms will influence their behaviour.

Accepted Answer

Define and explain the nature of the pri

Question 19

Define what is meant by 'market failure' and show the circumstances in which this might occur.

Accepted Answer

Describe the operation of market forces

Question 20

To what extent is there agreement that the 2008 global financial crisis was the result of insufficient attention being paid to government regulation? What actions are needed to reform the global financial system?

Accepted Answer

Explain the origins of the 2008 financia

Which of the following would indicate that markets are operating efficiently?

As incomes rise we would expect there be a greater percentage of this spent on services than on primary goods.

Explain why there was a widespread adoption of neoclassical and neoliberal policies across the global economy from the mid 1970s onwards. What are seen as the main weaknesses of this approach to economic policy?

Which of the following is not universally accepted as being a reason for legitimate government policy?

Explain what is meant by the economic problem and show how economic efficiency relates to its three parts.

The basic economic problem is simply that we haven't got enough money to do all the things that we want.

Which of the following are examples of an externality? Please select all that apply.

Which of the following are the most likely characteristics of a market which has a high degree of monopoly power? Please select all that apply.

Which of the following activities in the supply chain for automobiles is an example of a service activity?

If there was a shortage in a particular market, which of the following is least likely to happen if the market is allowed to operate freely? Please select all that apply.

Economic efficiency has to encompass the three parts to the economic problem.

Which of the following businesses can be best described as being in the primary sector? Please select all that apply.

If as a result of a 5 per cent rise in price demand falls by 10 per cent, which of the following statements is correct? Please select all that apply.

The opportunity cost of an individual's decision to allocate a fixed amount of resources to an activity is best described as:

Assume that a person has sufficient resources to consume either A, B, or C, and chooses C. The opportunity cost of C is A and B.

If the demand for a good is relatively price elastic and its price falls the revenue will:

If revenue from sales of a product increases as a result of an increase in price, then the price elasticity of demand for the product must be relatively inelastic.

Explain what is meant by the term 'price elasticity of demand', and show with examples how differences in the price elasticity of demand faced by firms will influence their behaviour.

Define what is meant by 'market failure' and show the circumstances in which this might occur.

To what extent is there agreement that the 2008 global financial crisis was the result of insufficient attention being paid to government regulation? What actions are needed to reform the global financial system?

Introduction: Business and Its Environment in a Globalizing World

The Technological Environment

The Political Environment

The Legal Environment

The Social and Cultural Environment

Can the Marketplace Be Ethical Corporate Responsibility

The Natural Environment: Global Warming, Pollution, Resource Depletion, and Sustainable Development

How Has Macroeconomic Policy Changed in an Era of Uncertainty

Globalization of Business: Good or Bad

Does Business Have Too Much Power

Is Inequality Bad for Business

Creating Effective Trading Blocs: What Lessons Does the European Union Provide

What Role for the Public Sector

From Starting to Scaling and Beyond: How Do Entrepreneurs and Smes Innovate and Grow

Conclusion: Looking Ahead-Managing in a Dynamic Environment

Filters

Exam 2: The Economic Environment

Which of the following would indicate that markets are operating efficiently?

As incomes rise we would expect there be a greater percentage of this spent on services than on primary goods.

Explain why there was a widespread adoption of neoclassical and neoliberal policies across the global economy from the mid 1970s onwards. What are seen as the main weaknesses of this approach to economic policy?

Which of the following is not universally accepted as being a reason for legitimate government policy?

Explain what is meant by the economic problem and show how economic efficiency relates to its three parts.

The basic economic problem is simply that we haven't got enough money to do all the things that we want.

Which of the following are examples of an externality? Please select all that apply.

Which of the following are the most likely characteristics of a market which has a high degree of monopoly power? Please select all that apply.

Which of the following activities in the supply chain for automobiles is an example of a service activity?

If there was a shortage in a particular market, which of the following is least likely to happen if the market is allowed to operate freely? Please select all that apply.

Economic efficiency has to encompass the three parts to the economic problem.

Which of the following businesses can be best described as being in the primary sector? Please select all that apply.

If as a result of a 5 per cent rise in price demand falls by 10 per cent, which of the following statements is correct? Please select all that apply.

The opportunity cost of an individual's decision to allocate a fixed amount of resources to an activity is best described as:

Assume that a person has sufficient resources to consume either A, B, or C, and chooses C. The opportunity cost of C is A and B.

If the demand for a good is relatively price elastic and its price falls the revenue will:

If revenue from sales of a product increases as a result of an increase in price, then the price elasticity of demand for the product must be relatively inelastic.

Explain what is meant by the term 'price elasticity of demand', and show with examples how differences in the price elasticity of demand faced by firms will influence their behaviour.

Define what is meant by 'market failure' and show the circumstances in which this might occur.

To what extent is there agreement that the 2008 global financial crisis was the result of insufficient attention being paid to government regulation? What actions are needed to reform the global financial system?

Introduction: Business and Its Environment in a Globalizing World

The Technological Environment

The Political Environment

The Legal Environment

The Social and Cultural Environment

Can the Marketplace Be Ethical Corporate Responsibility

The Natural Environment: Global Warming, Pollution, Resource Depletion, and Sustainable Development

How Has Macroeconomic Policy Changed in an Era of Uncertainty

Globalization of Business: Good or Bad

Does Business Have Too Much Power

Is Inequality Bad for Business

Creating Effective Trading Blocs: What Lessons Does the European Union Provide

What Role for the Public Sector

From Starting to Scaling and Beyond: How Do Entrepreneurs and Smes Innovate and Grow

Conclusion: Looking Ahead-Managing in a Dynamic Environment

Filters