Unit one test
Yvonne Harvey, Contributor

Students of Bridgeport High School's choir harmonise before taking the stage at the school's anniversary and awards ceremony on Friday, September 29. - Anthony Minott/freelance photographer

Hello students. I hope you remember that this week is your test on Unit One of the syllabus. Please pay careful attention to the instructions and command words used, as these will indicate to you exactly what you are required to do. Also, for each part of a question, you should use the marks provided in brackets as a guide to tell you the number of points needed and/or the depth required in your answer.

You should spend a maximum of 25 minutes on each essay question and a maximum of 10 minutes on the multiple-choice section. Go ahead now and all the best to all of you.

SECTION ONE

Answer questions 1 or 2 AND 3 or 4. You should, therefore, answer TWO questions in all.

1. (a) Define the term 'barter'. (2 marks)

(b) Explain THREE problems of the barter system. (6 marks)

(c) What system was introduced to resolve the problems of the barter system? Outline ONE problem that this system was able to solve. (2 marks)

TOTAL MARKS: 10

2. (a) What is meant by 'division of labour?' (2 marks)

(b) Explain THREE ways in which division of labour benefits production. (6 marks)

(c) List TWO limitations of division of labour. (2 marks)

TOTAL MARKS: 10

3. (a) What is an 'economic system?' (2 marks)

(b) List the THREE main types of economic systems. (3 marks)

(c) Compare and contrast the free market economy and the panned economy under the following headings:

(i) Ownership and allocation of scarce resources.
(ii) Motivation for production and the types of goods and services produced.
(iii) Degree of competition in production.
(iv) Degree of government involvement.
(v) Freedom of choice

(10 marks)

(d) Write notes on the characteristics of the mixed economy. Your notes should include FIVE different characteristics. (5 marks)

TOTAL MARKS: 20

4. (a) Define the term 'sector of an economy'. (2 marks)

(b) State TWO major differences between public sector production and private sector production. (4 marks)

(c) Discuss the differences listed in (b) above. (4 marks)

(d) Outline THREE sources of funding for private sector businesses. (6 marks)

(e) Discuss THREE disadvantages of the private sector to the citizens of a country. (6 marks)

TOTAL MARKS: 20

SECTION TWO

Answer ALL Questions.

For each question, circle the letter which in your estimation provides the BEST answer.

1. Man is termed an economic animal because he:

(a) has the ability to understand economic activity.
(b) lives a life that is governed by economic principles.
(c) studies economics in order to live a comfortable life.
(d) utilises his ability to satisfy his wants from the gifts of nature.

2. Barter means:

(a) an exchange of goods and services for money.
(b) an exchange of goods and services for cash.
(c) the direct exchange of goods and services for goods and services.
(d) the exchange of goods and services for bank notes.

3. The MOST important role of a business in any community is to provide:

(a) jobs for the unemployed .
(b) goods and services to satisfy wants.
(c) revenue for the Government.
(d) a surplus of goods to earn foreign exchange.

4. Choice is a basic economic activity because

(a) interest rates are too high.
(c) incomes are too high.
(b) resources are scarce .
(d) inflation is too high.

5. The opportunity cost of a good is:

(a) the original cost to the producer.
(c) the alternative which is foregone in order to obtain it.
(b) the original cost to the consumer.
(d) the value of the goods for which it could be exchanged.

6. An advantage of a planned economic system is that:

(a) competition flourishes.
(b) private monopolies do not exist.
(c) the profit motive provides an incentive for business enterprise.
(d) there is an automatic and self-regulating economic process.

7. A characteristic of a free economic system is:

(a) private ownership of capital.
(c) government ownership of capital.
(b) control of labour.
(d) central allocation of resources.

8. The MOST important feature of the private sector in any CARICOM country is:

(a) the maximisation of profits.
(c) the provision of important utilities.
(b) credit expansion.
(d) mass communication.

9. Which of the following types of business can be found in the private sector?

(a) Municipal corporations
(c) Public corporations
(b) Nationalised companies
(d) Public limited companies

10. The public sector comprises:

(a) a body of public corporations, public companies and municipal undertakings.
(b) central and local governments and state corporations.
(c) an association of all public companies within the country.
(d) a combination of public companies and public corporations.

I suggest that you get someone who is knowledgeable in the subject to mark the essay questions for you. The answers to the multiple-choice questions are as follows:

1. (d) 2 (c) 3 (c) 4 (b) 5 (c) 6 (b) 7 (a) 8 (a) 9 (d) 10 (b)

Next week we will begin looking at Unit 2, internal organisational structure of a business. See you then.

Yvonne Hardy teaches at Glenmuir High School.