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The article is devoted to assessment tools in teaching economics. The authors distinguish and define four levels of understanding economics: elementary, intermediate, systemic and creative. They describe multiple choice questions and essay questions as two possible assessment tools in teaching economics. Multiple-choice questions are represented as the most popular testing format. The advantages of multiple-choice questions include low grading costs, perceived objectivity and availability of comparative analysis. The authors have developed multiple-choice tests, which measure students’ knowledge at three first levels of understanding economics. They enable instructors to see where exactly the students’ understanding has stopped and provide guidance. The authors conclude that multiple-choice questions can be used to measure the basic levels of students’ understanding economics. In measuring higher levels the essay as an assessment tool has a great potential. The authors highlight the advantages and pitfalls of essay testing in economics.

Multiple-choice questions and essays in assessing economics