AP Services, Central Place Theory & the Informal Economy

Question 1

What does the tertiary sector of the economy primarily involve?

Accepted Answer

Providing services to consumers and businesses

Answer

The tertiary sector involves service provision—including retail, transportation, finance, and healthcare—rather than producing or extracting physical goods.

Question 2

Which concept, developed by Walter Christaller, explains the size and distribution of cities based on the services they provide?

Accepted Answer

Central place theory

Answer

Central place theory, developed by Christaller in 1933, proposes that settlements serve as central places providing goods and services to surrounding hinterlands, with larger settlements offering higher-order goods.

Question 3

In central place theory, the minimum number of customers needed to make a service economically viable is called the:

Accepted Answer

Threshold

Answer

The threshold is the minimum market size (population) required for a business or service to be profitable and sustainable.

Question 4

The 'range' in central place theory refers to:

Accepted Answer

The maximum distance consumers will travel to obtain a service

Answer

Range is the maximum distance consumers are willing to travel to obtain a particular good or service, defining the outer boundary of a market area.

Question 5

The informal economy is best described as:

Accepted Answer

Economic activities not regulated by the government and untaxed

Answer

The informal economy consists of economic transactions that occur outside government regulation, official taxation, and statistical monitoring, common in developing countries.

AP Practice Test

AP Practice Test

AP Services, Central Place Theory & the Informal Economy