| Question | Answer |
| 1. Name and define the four factors of production? | Land, natural resources; Labour, human resources; Capital, man-made resources; Enterprise, ideas and risk-taking
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2. Explain and provide an example of opportunity cost. | The cost of choice being the next best alternative foregone with an example.
| 3. Describe the three main types of economic system. | Market, mixed and planned with an explanation.
| 4. Explain and give two examples of substitute goods and complementary goods. | Substitute - a good which can satisfy the same want as another good e.g.coca cola and pepsi. Complementary - goods which are used together or in joint demand such as toothbrush and toothpaste.
| 5. Name and explain four factors which can cause a change in demand for a product or service. | Change in price of substitutes/complements; changes in consumer incomes; environmental factors such as weather; changes in tastes/fashion; population size changes
| 6. Define and give one example of a positive externality and a negative externality. | Negative - a cost imposed on a third party as a result of the actions of others e.g. pollution caused by factory production or cars. Positive - the benefits enjoyed by a third party as a result of actions/decisions made by others - better health due to free vaccinations.
| 7. What are the five main characteristics of money? | Durability, portability, divisibility, scarcity and generally accepted.
| 8. Name the four functions of money. | Medium of exchange, Good store of value; Measure of value; Means of deferred payment.
| 9. Distinguish between a commercial bank and a central bank. | Commercial offers services to individuals whereas the central bank is the banks' bank plus the government's bank etc.
| 10. Name and explain two Human Development Indicators. | GDP per capita; Life expectancy; years of education etc. with explanation.
| 11. Explain and give two examples of fiscal policy. | Actions involving spending or taxation taken by the government to influence the economy e.g. Expansionary policy of building a new railway network. Contractionary policy of increasing income taxes.
| 12. What is inflation and how is it measured? | A sustained increased in price levels measured by comparing the prices of a typical basket of consumer goods(CPI).
| 13. Draw a diagram to illustrate the economic cycle. | A graph showing growth, peak/boom, recession, trough etc.
| 14. Explain and give one example of both visible and invisible exports. | Visible - selling physical goods to other countries e.g. Germany selling cars to UK. Invisible - selling services to other countries e.g. India selling IT consultancy to Indonesia.
| 15. What are the four Ps of marketing? | Price, promotion, place and product.
| 16. Draw Maslow's hierarchy of needs and give two examples of each type of human need. | Physiological - food and shelter. Safety - being safe and having job security. Social - need for interaction with others, love and friendship; activities. Self-esteem - recognition; respect from others; opportunity to progress. Self-actualisation - constant challenges and rewarding life.
| 17. Define and give three examples of a business expense. | A cost incurred in the day-to-day running of a business e.g rent, wages, electricity, telephones.
| 18. Name and explain three different leadership styles. | Autocratic, democratic, laissez-faire, situational with explanation.
| 19. List as many forms of communication as you can think of. | There will be many!
| 20. Name and describe two types of lean production. Start your answer with and explanation of lean production. | Could include just-in-time; cell production; CAM; Kanban etc. |
