SECTION A [10 MARKS] MULTIPLE CHOICE QUESTIONS Each question carries 1 (ONE) mark 1. The most important determinants of market demand include all of the following except __________________________. A. The price of the commodity B. Consumers incomes and tastes C. Expectations about future prices and incomes D. Price of inputs 2. Which of the statements below are true with respect to the supply curve? A. As production costs fall the supply of a commodity falls B. As the production costs fall, the supply of a commodity rises C. Supply of a commodity rises where the government increases standards on pollution D. Advancement in technology lowers production costs and reduces supply 3. The difference between a monopoly and a monopsony is that _________________. A. A monopoly is a price setter in the factor market while a monopsony is a price setter in the product market B. In a monopoly selling an additional product generates marginal revenue which is higher than price while in a monopsony it generates marginal factor cost which is equal to price C. In a monopoly the demand curve determines the price while in a monopsony price is determined by the supply curve D. In a monopoly profit is maximized where marginal revenue of higher than marginal cost while in a monopsony marginal revenue product and marginal factor cost are equal

4. Which of the following is not source of human capital differences? A. Innate ability B. Schooling C. Sustainability D. Training 5. The effect of imposing a minimum wage above equilibrium in a competitive labour market is to ______________________. A. Increase both wages and unemployment B. Decrease wages C. Decrease labour supply D. Increase wages 6. Discouraged workers are defined as ________________________. A. Those who are working under poor working conditions B. those workers have given up job search because they do not believe they can find a job C. Those who lose their job and immediately find another one D. Those who have been unemployed for a long time 7. Which one of the following is a solution to frictional unemployment? A. The government can also provide part time employment during the off-peak period. B. Training schemes need to be focused on skills and qualifications which will enable the unemployed to find work in new industries C. Private companies can also set up vacancy portals, human resources agencies can also set up online portals D. All of the above

8. Which of the following is not a source of monopsony power in the labour market? A. Lack of information B. Geographical immobility C. Difficulties of moving between jobs D. None of the above 9. Which of the following is not a cause of strike action? A. Economic Lockdown B. Increment not up to the mark C. Wrongful discharge or dismissal of workmen D. Salary and incentive problems 10. Which of the following is a form of migration? A. Voluntary migration B. Seasonal migration C. Return migration D. All of the above