Multiple Choice Questions Section 1 Basic Concepts of Economics

Fundamentals of Economics Final Revision Sheets 2025 1 Multiple choice questions Section 1: Basic Concepts of Economics 1- Why is studying economics important for individuals? a. It teaches you how to earn more money b. It helps you develop a way of thinking to make better choices c. It ensures you always have enough resources d. It eliminates scarcity in your life 2- Why should engineering students study economics? a. To learn how to build better machines b. To understand how market conditions affect project costs and timelines c. To avoid working with limited resources d. To focus solely on technical skills 3- What does the term "economy" refer to? a. A system of producing, distributing, and consuming goods and services b. A collection of unlimited resources c. The study of human behavior d. The government’s financial budget 4- How is "economics" defined in the document? a. The study of unlimited resources b. A science that studies human efforts to satisfy unlimited wants with limited resources c. A method to increase wealth without effort d. A way to avoid making choices 5- What does the adjective "economic" describe? a. Anything related to politics b. Issues or activities connected with the economy or economics c. The study of science and technology d. Personal opinions about wealth 6- What distinguishes "wants" from "needs"? a. Wants are necessary for survival, needs are not b. Wants are broader and not essential, while needs are required for survival c. Wants are limited, needs are unlimited d. Wants and needs are the same thing 3 7- What is scarcity in economics? a. Having too many resources b. The ability to produce everything society needs c. A situation where resources are evenly distributed d. The problem of unlimited wants with limited resources 8- Which factor of production earns "rent" as its return? a. Labour b. Capital c. Land d. Entrepreneur 9- What is the return to labour? a. Interest b. Wages/salaries c. Profit d. Rent 10- Which resource earns "interest" as its reward? a. Land b. Labour c. Capital d. Enterprise 11- Which one of the following is not a factor of production? a. Land b. Labor c. Capital d. Bank Loan 12- Computer programs or software are an example of: a. Land. b. Labor. c. Capital. d. None of the above. 13- What is meant by 'labour' in economics? a. Hard physical work used to produce manufactured goods b. Human mental and physical effort used for producing goods and services c. Natural resources used in the productive process d. Risk taking and organising the factors of production 4