AS & A Level Economics (9708) — May–June 2024, Paper 32

30 questions · every question answerable online with instant point-by-point AI marking against the official mark scheme.

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Question 1 · 1 mark · The price system and the microeconomy - utility and marginal utility

The table shows the total utility gained by a consumer from the consumption of water. quantity consumed / bottles total utility --- --- 0 0 1 30 2 40 3 48 4 54 5 58 What can be…

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Question 2 · 1 mark · The price system and the microeconomy - budget lines

A consumer has $100 to spend on two products, X and Y. The budget line shows the different possible combinations of products X and Y that can be purchased when all the consumer’s…

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Question 3 · 1 mark · The price system and the microeconomy - externalities and social costs and benefits

Which combination of costs and benefits will lead to an increase in net social costs? private benefits external benefits private costs external costs --- --- --- --- --- A falls…

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Question 4 · 1 mark · The price system and the microeconomy - costs of production

A firm increases its output, starting from zero. How will this affect its short-run marginal cost (MC), average total cost (ATC) and average fixed cost (AFC)? MC ATC AFC --- ---…

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Question 5 · 1 mark · The price system and the microeconomy - market structure and price-making power

Assuming the absence of price controls, in which industry is an individual firm least likely to be able to alter the price at which it sells its product? A air transportation B…

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Question 6 · 1 mark · The price system and the microeconomy - firms' objectives and revenue maximisation

A firm has the choice between five levels of output. The table shows the total cost and total revenue of producing at each output level. The firm could sell whatever output it…

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Question 7 · 1 mark · Government microeconomic intervention - externalities and deadweight welfare loss

The diagram shows the costs and benefits of producing steel in a free market. [Diagram: axes labelled ‘cost, benefit’ (vertical) and ‘output’ (horizontal), origin O. Two…

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Question 8 · 1 mark · The price system and the microeconomy - small firms and survival

What is likely to make it more difficult for a small firm to survive? A increased preference on the part of consumers for distinctive non-standardised products B reductions in the…

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Question 9 · 1 mark · The price system and the microeconomy - contestable markets

A market structure in which a small number of firms face competition from potential entrants. What does this describe? A a contestable market B a monopoly C monopolistic…

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Question 10 · 1 mark · The price system and the microeconomy - integration and growth of firms

What is an example of backward vertical integration? A a bakery buying a wheat farm B a car manufacturer buying a car showroom C a vineyard buying an apple orchard D two rival…

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Question 11 · 1 mark · Government microeconomic intervention - policies to correct market failure

A government wants to introduce a policy that will reduce the pollution caused by the production of a good. Which policy would not make use of market forces? A a quota to limit…

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Question 12 · 1 mark · Government microeconomic intervention - privatisation

The table shows the annual percentage change in the output per worker employed for four nationalised industries before and after privatisation. nationalised industry before…

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Question 13 · 1 mark · The price system and the microeconomy - the labour market and net advantage

Most workers in a country are employed in the manufacturing sector where they are paid a fixed wage rate per hour. What will lead to an increase in the net advantage of workers…

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Question 14 · 1 mark · The price system and the microeconomy - the labour market and marginal revenue product

When will a profit-maximising firm employ the optimum number of workers? A when the average revenue product of labour equals the average cost of hiring workers B when the marginal…

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Question 15 · 1 mark · The price system and the microeconomy - economic rent and transfer earnings

The diagram shows the labour market for farm workers in New Zealand. [Diagram: ‘wage rate’ on the vertical axis and ‘quantity of labour’ on the horizontal axis, origin O. An…

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Question 16 · 1 mark · The macroeconomy - money and banking and commercial banks

What is not a function of a commercial bank? A to help firms raise finance B to hold cash on deposit for firms C to lend money to households D to provide savings accounts

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Question 17 · 1 mark · The macroeconomy - employment and unemployment statistics

In 2020 in a country, the unemployment rate of the 16–64 age group seeking work was 4.0%. The employment rate for this group in the same period was 76.6%. What can be concluded…

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Question 18 · 1 mark · The macroeconomy - unemployment benefits and the labour market

Which statement relating to unemployment benefits provided by a government is not valid? A They allow firms to dismiss workers as unemployment benefits provide support to…

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Question 19 · 1 mark · The macroeconomy - the national income multiplier

Country X has a marginal propensity to consume (MPC) of 0.7. Its marginal propensity to save (MPS), marginal rate of taxation (MRT) and marginal propensity to import (MPM) are…

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Question 20 · 1 mark · The macroeconomy - output gaps and macroeconomic equilibrium

The diagrams show the performance of an economy using different measures. [Diagrams: three separate diagrams. (1) A production possibility curve with ‘goods’ on the vertical axis…

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Question 21 · 1 mark · The macroeconomy - monetary policy and the liquidity trap

Which row correctly identifies the characteristics of an economy experiencing the liquidity trap? rate of economic growth rate of inflation rate of interest --- --- --- --- A high…

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Question 22 · 1 mark · The macroeconomy - macroeconomic policy and recession

Which combination of policies would be most likely to bring a country out of recession? A expansionary fiscal and monetary policy as well as supply-side policies B expansionary…

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Question 23 · 1 mark · The macroeconomy - inflation and the balance of payments

The inflation rate in a country increased. Which effect would this most likely have on the country’s balance of payments? A an improvement in the current account balance B an…

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Question 24 · 1 mark · The macroeconomy - monetary and fiscal policy for deflation

A government uses monetary policy and fiscal policy to solve a problem of deflation. Which policy combination is likely to be the most successful? monetary policy fiscal policy…

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Question 25 · 1 mark · The macroeconomy - macroeconomic indicators and unemployment

The table shows indicators for the macroeconomies of two South American countries over one year. During this year, both governments attempted to reduce unemployment by expanding…

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Question 26 · 1 mark · International economic issues - expenditure-switching policies

A measure encourages consumers to change spending on imports to spending on domestically produced goods. What does this describe? A an expenditure-reducing policy B an…

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Question 27 · 1 mark · International economic issues - exchange rates and the Marshall–Lerner condition

The macroeconomic objective of a government is to move the current account of the balance of payments from deficit to surplus. To achieve this, it devalues the currency. Under…

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Question 28 · 1 mark · International economic issues - foreign direct investment and the balance of payments

A multinational company (MNC) buys a manufacturing firm in a developing country that produces goods for the developing country’s domestic consumers. The MNC then exports machinery…

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Question 29 · 1 mark · Economic development - population and development indicators

The table gives information about the population of three countries in a given year. birth rate per 1000 death rate per 1000 infant mortality rate per 1000 % of population under…

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Question 30 · 1 mark · Economic development - measures of living standards and economic welfare

During a certain period, a country with a constant population expands its output per head. It also experiences a significant increase in river and atmospheric pollution. In the…

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