INFORMAL/REVISION TEST – Circular Flow
30 MARKS
-
30 minutes
NAME: ______________________ CLASS:______
INSTRUCTIONS:
1. Answer all the questions on the spaces provided.
2. Write neatly and legibly.
3. GOOD LUCK!
Question 1
Indicate whether the following statements are TRUE or FALSE
1. In an open economy, there are no imports and exports.
_______
2. Households receive an income from businesses.
_______
3. The place where participants meet to buy goods and services are
known as the factor market.
QUESTION 2
Look at the pictures before answering the questions.
Picture A
Picture B
Picture C
Picture D
_______
(3x1) [3]
2.1.
Identify the four factors of production:
Picture A:
______________________________
Picture B:
______________________________
Picture C:
______________________________
Picture D:
______________________________
2.2.
(8)
Which one of the above-mentioned factors of production does households
mostly provide to businesses?
___________________________
(2)
[10]
QUESTION 3
3.1
Name the THREE main participants in the circular flow of a country.
(3)
______________________________
______________________________
______________________________
3.2.
Discuss the role of the government in the circular flow of a country.
(3x2)
______________________________________________________
______________________________________________________
______________________________________________________
______________________________________________________
______________________________________________________
3.3
Services delivered by the government are known as _____________
(1)
[10]
QUESTION 4
4.1.
In your opinion, what would happen if government were to increase household
tax substantially? How would that impact consumer spending?
(4)
______________________________________________________________
______________________________________________________________
______________________________________________________________
______________________________________________________________
4.2
Name three ways in which goods and services flow through the economy. (3)
______________________________________________________________
______________________________________________________________
______________________________________________________________
[7]
TOTAL: 30 marks
INFORMAL/REVISION TEST – CIRCULAR FLOW
MARKING GUIDELINES
Question 1
1.
2.
3.
False√
True√
False√
(3x1)
[3]
QUESTION 2
2.1.
2.2
Picture A:
Land √√
Picture B:
Entrepreneurship √√
Picture C:
Labour √√
Picture D:
Capital √√
Labour √
(8)
(2)
[10]
QUESTION 3
3.1.
Households √
Government √
Businesses / Firms √
3.2.
(3)
Businesses and households pay tax towards the government.
The government provides goods and services to businesses and households.
The government makes use of labour provided by households.
The government buys goods and services from business.
3.3
Public goods and services
(3x2)
(1)
[10]
QUESTION 4
4.1.
In your opinion, what would happen if government were to increase household
tax substantially? How would that impact consumer spending?
(4)
-
Consumers will have less disposable income as they are paying more tax. √√
-
As a result they will have less money to spend and spending will decrease. √√
Any other relevant and logical correct explanation.
4.2 List 3 ways in which goods and services flow through the economy.
•
•
•
•
(3)
Business provides goods and services to households via the Goods and
Service market.
Households spend their income on goods and services.
The Government spends money to purchase goods and services from
business.
Households provides labour in order to produce more goods and services.
(Any other correct for answer for 1 mark each)
[7]
TOTAL: 30 marks