The Economics test measures your knowledge according to the Arizona Academic Standards. Success on the test indicates that you are qualified to teach economics in Arizona public schools. The test content is drawn from four subareas based on AEPA learning objectives: Basic Economic Concepts and Microeconomics (28% of the test); Macroeconomics, Economic Theories, and International Economics (36%); Economic Inquiry Skills (18%); and Consumer Economics (18%). The test covers basic topics within these areas, such as theories of micro- and macroeconomics. Test-takers should know how businesses use resources and interact with the marketplace, principles of government taxation, spending, and regulation, as well as principles and concepts of money, banking, and international economics. Finally, the test covers the interpretation, organization, analysis, and presentation of economic information, in addition to the relation between opportunity costs and personal financial decisions.
AEPA Economics Practice Questions
1. What is another name for an economic system in which there is no government intervention and in which business accounts for all production?
A: command economy
B: transitional economy
C: mixed economy
D: pure market economy
2. Who is the likely beneficiary of a voluntary exchange?
A: both parties
B: neither party
C: the buyer
D: the seller
3. Which of the following equations is correct?
A: revenue = profit – cost of production
B: profit = revenue – cost of production
C: cost of production = revenue + profit
D: profit = cost of production – revenue
4. What is the economic term for the value of the next-best option after the option that is chosen?
B: marginal utility
C: economic exchange rate
D: opportunity cost
5. What is the name for a scenario in which one firm can service a market at a lower per-unit cost than can multiple firms?
B: price fixing
C: natural monopoly
D: monetary policy
1. D. There are no pure market economies, though many countries strive to limit government regulation as much as possible.
2. A. Since the exchange is voluntary, it seems unlikely that either party would agree without an expectation of benefit.
3. B. In other words, profit is everything left over after paying the cost of doing business.
4. D. Economists calculate opportunity cost to determine the wisdom of business decisions.
5. C. In some markets, there is just not enough room for competing firms, so the government must monitor prices to ensure fairness to the consumer.