Edexcel GCSE Business Studies: The Economic Context Quiz

14 Questions | Total Attempts: 938

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Business Study Quizzes & Trivia

Edexcel GCSE Business Studies Unit 1. 5


Questions and Answers
  • 1. 
    Which statement is true?
    • A. 

      When prices are low, demand is relatively high

    • B. 

      When demand is high, supply is low

    • C. 

      When supply is high, prices are high

    • D. 

      When prices are low, supply is high

  • 2. 
    Which of the following is NOT a commodity?
    • A. 

      Gold

    • B. 

      Wool

    • C. 

      Coffee

    • D. 

      Money

    • E. 

      Nike trainers

  • 3. 
    If the price of petrol rises, which statement best describes the effect on a small delivery firm:
    • A. 

      The firm will go bankrupt

    • B. 

      The firm's prices will fall

    • C. 

      The firm's costs rise and so might prices

    • D. 

      The firm's costs rise, but prices will not

  • 4. 
    The price of chocolate falls. Which statement best describes a likely reason why this has happened -
    • A. 

      Demand for chocolate has risen

    • B. 

      Supply of chocolate has fallen

    • C. 

      The cost of sugar has risen

    • D. 

      More manufacturers are making chocolate

  • 5. 
    If interest rates fall -
    • A. 

      It becomes cheaper for firms to borrow money

    • B. 

      A currency becomes stronger

    • C. 

      A firm's costs rise

    • D. 

      Consumers save more of their income

  • 6. 
    If the interest rate rises -
    • A. 

      Small firms can sell goods more cheaply

    • B. 

      Consumers will borrow more money

    • C. 

      Consumers will save more, and borrow and spend less

    • D. 

      Firms can borrow money more cheaply

  • 7. 
    Which statement best describes an export for a UK firm -
    • A. 

      Raw materials they purchase from Germany

    • B. 

      A good or service they sell overseas

    • C. 

      French cheese

    • D. 

      A service purchased from a local supplier

  • 8. 
    If £1 = $1.80, then a £1,000 order of British cheese will sell in the USA for
    • A. 

      $180

    • B. 

      $100

    • C. 

      $1,000

    • D. 

      $1,800

  • 9. 
    If £1 = $1.50, then a $450 weekend break in New York will cost a UK customer -
    • A. 

      £600

    • B. 

      $600

    • C. 

      £2.25

    • D. 

      £300

  • 10. 
    If the £ is weaker -
    • A. 

      Exports become cheaper, imports become cheaper

    • B. 

      Exports become cheaper, imports become more expensive

    • C. 

      Import and export prices are unaffected

    • D. 

      Exports and imports become more expensive

  • 11. 
    If the £ becomes stronger -
    • A. 

      UK manufacturers may experience a fall in overseas sales

    • B. 

      UK holiday makers may choose to holiday at home

    • C. 

      Importers to the UK will find it harder to generate UK sales

    • D. 

      Small UK firms will see costs of imported goods and raw materials rise

  • 12. 
    Which TWO statements are correct? In a recession -
    • A. 

      Demand and unemployment both rise

    • B. 

      Bankruptcy rates fall

    • C. 

      Suppliers of luxury goods will often find that sales revenue falls

    • D. 

      Consumers will save all their disposable income

    • E. 

      Output falls, unemployment rises

  • 13. 
    Which TWO statements are correct?In a boom -
    • A. 

      Most firms will need to borrow money

    • B. 

      Unemployment will be low

    • C. 

      Prices may begin to rise at a faster pace

    • D. 

      Cheaper goods and services will sell very well

    • E. 

      Import volumes will fall

  • 14. 
    Which ONE statement is false?If firms can correctly forecast future economic conditions -
    • A. 

      They are less likely to need to borrow money from a bank

    • B. 

      They are less likely to experience falling revenues when economic conditions become worse

    • C. 

      They are more likely anticipate and respond to changing market needs and wants

    • D. 

      They are more likely to survive a recession

    • E. 

      They are more likely to achieve growth over time

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