ECONOMICS EXAMINATION QUESTIONS AND CORRECT ANSWER WITH EXPLANATION GRADED A+ STUDY GUIDE

ECONOMICS EXAMINATION QUESTIONS AND CORRECT
ANSWER WITH EXPLANATION GRADED A+ STUDY GUIDE
SOUTHERN NEW HAMPSHIRE UNIVERSITY
1. Economics is the study of:
A. Crime control
B. How scarce resources are allocated
C. Court systems
D. Police operations
Answer: B
Rationale: Economics focuses on scarcity and choice.

2. Scarcity means:
A. Abundance of goods
B. Limited resources relative to wants
C. Unlimited money
D. No production
Answer: B
Rationale: Resources are limited.

3. Opportunity cost is:
A. Total cost
B. Value of the next best alternative forgone
C. Crime cost
D. Court cost
Answer: B
Rationale: Economics principle of choice.

4. Microeconomics studies:
A. Entire economy
B. Individual units like households and firms
C. Government only
D. Crime systems
Answer: B
Rationale: Small-scale economics.

5. Macroeconomics studies:
A. Individuals only

, B. Economy as a whole
C. Crime only
D. Courts only
Answer: B
Rationale: Aggregate economy.

6. Demand is:
A. Willingness to sell
B. Willingness and ability to buy
C. Court order
D. Crime demand
Answer: B
Rationale: Consumer desire and ability.

7. Supply is:
A. Buying goods
B. Willingness and ability to sell
C. Court supply
D. Crime supply
Answer: B
Rationale: Producer behavior.

8. Law of demand states:
A. Price increases demand increases
B. Price increases demand decreases
C. No relationship
D. Courts affect demand
Answer: B
Rationale: Inverse relationship.

9. Law of supply states:
A. Price increases supply decreases
B. Price increases supply increases
C. No relationship
D. Crime affects supply
Answer: B
Rationale: Direct relationship.

10. Equilibrium price is where:
A. Demand = Supply

, B. Demand > Supply
C. Supply > Demand
D. Crime equals courts
Answer: A
Rationale: Market balance.

11. Inflation is:
A. Price decrease
B. General rise in prices
C. Crime increase
D. Court increase
Answer: B
Rationale: Rising price level.

12. Deflation is:
A. Price increase
B. General fall in prices
C. Crime decrease
D. Court decrease
Answer: B
Rationale: Falling prices.

13. GDP stands for:
A. Global Debt Product
B. Gross Domestic Product
C. Government Domestic Price
D. General Development Plan
Answer: B
Rationale: Total output of a country.

14. GDP measures:
A. Crime level
B. Total economic output
C. Court cases
D. HR activity
Answer: B
Rationale: National production.

15. Unemployment is:
A. Full employment