The price system and the microeconomy — AS & A Level Economics (9708) questions by topic
Demand and supply shifts, elasticity, cost curves and market structures generate the largest single set of questions in this syllabus: 296 real past-paper questions from 2023 to 2025, worth between 1 and 20 marks apiece.
Deduce and calculate carry the objective items, while assess and explain drive the longer data-response parts, which typically ask you to apply XED or YED to a named product rather than describe elasticity in the abstract. Because diagram accuracy is heavily rewarded here, drafting full responses and submitting them for instant marking is the quickest way to catch a marginal-cost curve that fails to pass through minimum average cost before it costs marks on a full paper.
What examiners look for
- Examiners repeatedly note answers that display knowledge of XED and YED with formulae and diagrams but never apply it to which determinant matters most for the good in question, which only earns AO1.
- A recurring criticism is untidy or imprecise diagrams, especially marginal cost curves that do not pass through minimum average cost or fail to mark profit maximisation where MR equals MC.
- Reports flag a lack of focus on time-specific wording in the question, such as 'the period of economic growth', so answers that ignore it cannot pass Level 1.
- Strong responses provide an accurate, fully labelled diagram distinguishing a shift from a movement along the curve, then explore the cross-price relationship between the goods named in the question.
- Strong answers open with a definition of excess profit and the conditions for perfect competition before showing how new entry erodes that profit in the long run.
May–June 2025, Paper 11
Cars and petrol (gasoline) are in joint demand. What is the effect of an increase in the price of cars on the demand for petrol? [Four diagrams labelled A-D, each with axes…
Answer this question and get it marked →What would best explain why the price elasticity of supply (PES) is likely to be lower for fresh vegetables grown within a country compared to the PES of goods manufactured in…
Answer this question and get it marked →The diagram shows the demand for and supply of a product. [Diagram: axes 'price' (vertical) and 'quantity' (horizontal). A downward-sloping demand curve D. Two upward-sloping…
Answer this question and get it marked →The diagram shows the demand for and supply of a product. [Diagram: axes 'price' (vertical) and 'quantity' (horizontal). An upward-sloping supply curve S and a downward-sloping…
Answer this question and get it marked →May–June 2025, Paper 12
What is a statement of the non-rivalrous nature of public goods? A It is not possible to stop a non-payer from using the product. B One person consuming the product does not…
Answer this question and get it marked →D1 and S1 are the initial demand and supply curves in the market for new cars with an equilibrium at X. The diagram shows a new demand curve D2 (shifted right) and a new supply…
Answer this question and get it marked →When can a product be said to have a negative income elasticity of demand? A When it is a luxury good. B When it is a necessity good. C When it is a normal good. D When it is an…
Answer this question and get it marked →The diagram shows the short-run supply curve (SSR) and long-run supply curve (SLR) for a bakery. The price of a loaf of bread increases from $2.00 to $2.20. Along SSR quantity…
Answer this question and get it marked →An increase in which variable will always lead to an increase in the consumer surplus? A cost of production B maximum price C minimum price D subsidy
Answer this question and get it marked →Farmers want to extract wild honey from beehives. They find the beehives by following birds known as honeyguide birds who want the beeswax that is also found in the beehives. What…
Answer this question and get it marked →What would not be included in the calculation of an individual's wealth? A the house owned by the individual B the savings in the individual's bank account C the stocks and shares…
Answer this question and get it marked →May–June 2025, Paper 13
A theatre has a fixed number of tickets to sell for each performance. What is the price elasticity of supply? A perfectly elastic B perfectly inelastic C unit elastic and negative…
Answer this question and get it marked →The diagram shows the market for computers in a country. [Diagram: price on the vertical axis, quantity on the horizontal axis, origin O. A downward-sloping demand curve and an…
Answer this question and get it marked →The diagram shows the market demand for and supply of foodstuffs for an economy. This economy has faced a decrease in the supply of foodstuffs and, at the same time, an increase…
Answer this question and get it marked →What is true for income elasticity of demand but not for price elasticity of demand? A It helps firms differentiate between goods with elastic and inelastic demand. B It helps…
Answer this question and get it marked →The table shows the supply and demand for avocados in kilograms (kg). price per kg ($) quantity demanded per day (kg) quantity supplied per day (kg) --- --- --- 45 170 230 40 190…
Answer this question and get it marked →A construction firm estimates that the price elasticity of supply in building a nuclear power plant is +0.1. What might explain this? A The firm can easily find new land as…
Answer this question and get it marked →Which statement about maximum and minimum prices is correct? A With an effective maximum price for a product, a shortage will develop. B With an effective maximum price for a…
Answer this question and get it marked →May–June 2025, Paper 22
With the help of examples, explain the difference between public goods and free goods and consider whether a market economy can ever produce public goods.
Answer this question and get it marked →Explain three reasons, associated with costs of production, why the supply curve for a particular market may shift to the right and consider the extent to which government…
Answer this question and get it marked →May–June 2025, Paper 23
Use a demand and supply diagram to demonstrate how 'a series of typhoons' affected the market price of food crops in Southeast Asia in January 2023. [2]
Answer this question and get it marked →Semi-conductors are widely used in the production of many types of electronic goods such as smartphones. It has been estimated that the price elasticity of supply for…
Answer this question and get it marked →May–June 2025, Paper 24
With the help of a formula, explain the meaning of price elasticity of demand and consider the significance to a firm of having price elastic or price inelastic demand for its…
Answer this question and get it marked →May–June 2025, Paper 31
What is the equi-marginal principle? A As consumption of a product increases, the satisfaction from consumption of the product decreases by an equal amount. B Consumers maximise…
Answer this question and get it marked →The diagram shows the cost and revenue curves for a natural monopoly. [Diagram: axes are 'price' (vertical) and 'quantity' (horizontal). A downward-sloping average revenue curve…
Answer this question and get it marked →What would not affect the budget line of an individual consumer? A the individual's preference for various goods B the level of income tax C the money prices of goods D the…
Answer this question and get it marked →The diagram shows the marginal private costs (MPC) and marginal private benefits (MPB) of a product. Consumers initially estimate that marginal private costs are at MPC1 and…
Answer this question and get it marked →What is an internal economy of scale? A efficient local transport networks B improved access to spare parts as a result of industry growth C lower risks from supplying a wider…
Answer this question and get it marked →The diagram shows the costs and revenue for a monopoly. Which level of output would produce only a normal profit? [Diagram: axes are '$' (vertical) and 'quantity' (horizontal). An…
Answer this question and get it marked →Which combination of statements about small firms and large firms is most likely to be correct? small firms large firms --- --- --- A are more common in manufacturing than in…
Answer this question and get it marked →May–June 2025, Paper 32
A consumer spends all of their income on only two goods, X and Y. The consumer is initially in equilibrium, maximising their total utility. The consumer's tastes change and they…
Answer this question and get it marked →The diagrams show four average cost curves. Which diagram illustrates diseconomies of scale? [Four diagrams, each with vertical axis '$' and horizontal axis 'output', origin O. A:…
Answer this question and get it marked →What would enable a firm to increase its market share in a monopolistically competitive market? A barriers to entry B collusion C lack of competition D successful advertising
Answer this question and get it marked →Two manufacturing firms in the same industry, producing similar products, are considering merging together. What would be the least convincing reason for merging? A It would…
Answer this question and get it marked →A worker has a low wage. They have little incentive to earn extra income because they will pay more income tax and receive fewer means-tested benefits. What describes this…
Answer this question and get it marked →The diagram shows the labour market for a profit maximising industry with a monopsony employer. [Diagram: vertical axis 'wage rate', horizontal axis 'quantity of labour', origin…
Answer this question and get it marked →What is not a factor affecting the supply of labour? A emigration rates B labour participation rate C labour productivity D unemployment benefits
Answer this question and get it marked →The diagrams show the demand for and supply of labour. [Three diagrams, each with vertical axis 'wage rate' and horizontal axis 'quantity of labour', origin O. Left diagram: an…
Answer this question and get it marked →May–June 2025, Paper 33
What is the equi-marginal principle? A As consumption of a product increases, the satisfaction from consumption of the product decreases by an equal amount. B Consumers maximise…
Answer this question and get it marked →What would not affect the budget line of an individual consumer? A the individual's preference for various goods B the level of income tax C the money prices of goods D the…
Answer this question and get it marked →The diagram shows the marginal private costs (MPC) and marginal private benefits (MPB) of a product. Consumers initially estimate that marginal private costs are at MPC1 and…
Answer this question and get it marked →What is an internal economy of scale? A efficient local transport networks B improved access to spare parts as a result of industry growth C lower risks from supplying a wider…
Answer this question and get it marked →The diagram shows the costs and revenue for a monopoly. Which level of output would produce only a normal profit? [Diagram: axes of '$' (vertical) and 'quantity' (horizontal). A…
Answer this question and get it marked →Which combination of statements about small firms and large firms is most likely to be correct? small firms large firms --- --- --- A are more common in manufacturing than in…
Answer this question and get it marked →The diagrams show the demand for and supply of labour. [Three diagrams, each with axes 'wage rate' (vertical) and 'quantity of labour' (horizontal). Left diagram: an…
Answer this question and get it marked →What is a factor affecting the occupational mobility of labour? A education and training B immigration controls C price of housing D transport infrastructure
Answer this question and get it marked →May–June 2025, Paper 34
The diagram shows a consumer's indifference curve (I₁) for two goods, X and Y. [Diagram: an indifference curve I₁ plotted with 'good X' on the vertical axis and 'good Y' on the…
Answer this question and get it marked →Which type of market structure enables price leadership to take place? A monopolistic competition B oligopoly C perfect competition D pure monopoly
Answer this question and get it marked →The tables show the market share of the five largest firms in two separate industries. industry X firm market share % --- --- E 32 F 26 G 22 H 10 J 5 industry Z firm market share…
Answer this question and get it marked →What determines the amount by which employment is reduced if a minimum wage is set 5% above the equilibrium market wage? A the average revenue product curve B the marginal revenue…
Answer this question and get it marked →May–June 2025, Paper 41
With the help of a diagram, evaluate the use of indifference curve analysis to explain the relationship between a change in the price of a product and the change in an individual…
Answer this question and get it marked →'The growth of a firm using a takeover is desirable because it enables consumers to benefit from lower prices and the firm to gain additional profits.' Evaluate this statement.
Answer this question and get it marked →May–June 2025, Paper 42
Monopolies restrict output to raise prices to exploit consumers. With the help of a diagram, assess the extent to which a government should intervene in monopoly markets. [20]
Answer this question and get it marked →May–June 2025, Paper 43
With the help of a diagram, evaluate the use of indifference curve analysis to explain the relationship between a change in the price of a product and the change in an individual…
Answer this question and get it marked →The growth of a firm using a takeover is desirable because it enables consumers to benefit from lower prices and the firm to gain additional profits. Evaluate this statement. [20]
Answer this question and get it marked →May–June 2025, Paper 44
Evaluate whether the marginal revenue product theory (MRP) always explains the differences in wages. [20]
Answer this question and get it marked →May–June 2024, Paper 11
An increase in which factor is likely to cause a shift to the left of the demand curve for cinema movies? A expenses for the heating system in the cinema B payments charged by…
Answer this question and get it marked →Four firms supply the market. The market supply is 50 units at $20 and 100 units at $40. The table shows the market share of each firm at the two prices. Which firm does not have…
Answer this question and get it marked →Which statement is correct? A Demand for an inferior good has a positive relationship to income and a negative relationship to price. B Demand for an inferior good has a negative…
Answer this question and get it marked →In which row are both statements correct? consumer surplus producer surplus --- --- --- A the value that consumers gain from consuming a good over and above the value that would…
Answer this question and get it marked →A firm calculates that the income elasticity of demand for its product is -3.0. What can be deduced from this information? A In a period of economic growth, its total revenue…
Answer this question and get it marked →The diagram shows the demand and supply curves for the global air cargo market. The initial equilibrium is at point X. What would the new equilibrium be if there is a global…
Answer this question and get it marked →May–June 2024, Paper 12
Changes in the market for gasoline (petrol) in Zimbabwe resulted in fuel shortages and long queues. Which combination of changes would have been certain to cause this situation?…
Answer this question and get it marked →The diagram shows the movement of the supply curve for a product from S₁ to S₂. [Diagram: axes with 'price' on the vertical axis and 'quantity' on the horizontal axis, origin O.…
Answer this question and get it marked →The tables show the different quantities of a good demanded at different prices and levels of income. price $ quantity demanded --- --- 5 9 4 10 3 20 2 40 1 120 income $ quantity…
Answer this question and get it marked →In Asia, instant noodles is an inferior good because dried fruit is a better quality substitute. The diagram shows the demand for instant noodles. [Diagram: 'price of instant…
Answer this question and get it marked →The diagram shows the impact of an increase in the price of a product from P₁ to P₂. [Diagram: 'price' on the vertical axis and 'quantity demanded' on the horizontal axis, origin…
Answer this question and get it marked →Which reason for the increase in demand for a smartphone is an example of joint demand? A a fall in its price B a fall in the price of connecting to a network C a fall in the…
Answer this question and get it marked →May–June 2024, Paper 13
Which business is likely to be the slowest to alter its output in response to a sustained increase in demand for its product? A a fast-food restaurant B a household cleaning…
Answer this question and get it marked →A company uses large amounts of gas to produce steel. Supplies of gas are reduced at the same time as the market for steel is hit by a recession. What can be said about the likely…
Answer this question and get it marked →A firm is charging a price of $12 for its product and using 80% of its production capacity of 10 000 units per month. Assuming the product has unitary price elastic demand, which…
Answer this question and get it marked →The diagram shows the demand for and supply of hotel accommodation. The market equilibrium is at point E. The hotel receives a very large number of bad reviews about the quality…
Answer this question and get it marked →What most accurately describes a market supply curve? A supply at different income levels, assuming product prices remain unchanged B supply at different levels of factor prices,…
Answer this question and get it marked →In the diagram, D₁ shows an individual’s initial demand curve for public transport. What could cause the demand curve to shift to D₂? A The costs of running the individual’s car…
Answer this question and get it marked →The diagram shows the supply curve of a product. The government imposes a specific indirect tax of $5 on the product. How will the price elasticity of supply of the product…
Answer this question and get it marked →May–June 2024, Paper 23
From 2030, most new car production in the United Kingdom (UK) will be of electric cars. Excluding the price of electric cars, explain the determinants of demand for electric cars…
Answer this question and get it marked →May–June 2024, Paper 31
Which statement about the concept of utility is correct? A Diminishing marginal utility means that producers become less efficient the more they produce. B If marginal utility is…
Answer this question and get it marked →The diagram shows indifference curves I₁, I₂ and a budget line T. [Diagram: the vertical axis is labelled 'units of X' and scaled from 0 to 100 (marked at every 10); the…
Answer this question and get it marked →The diagram shows the cost and revenue curves for a firm. Which output level will enable a firm to achieve its objective of maximising its revenue? [Diagram: the vertical axis is…
Answer this question and get it marked →Oligopoly firms seek to maximise profits. How will this affect the pricing behaviour of oligopoly firms involved in a non-collusive market? A A price is fixed for the product that…
Answer this question and get it marked →Which assumption is essential for a market to be contestable? A The market is supplied by a large number of firms. B Firms are free to enter and leave the market. C Firms cannot…
Answer this question and get it marked →A firm that raises capital through a share issue has to satisfy both shareholders' expectations and management aims. The management aims to produce at a non-profit maximum output.…
Answer this question and get it marked →A major UK chemical firm was bought by its rival, a Dutch chemical firm. What definitely occurred when the Dutch firm bought the UK firm? A a partnership B economies of scale C…
Answer this question and get it marked →Which statement is correct for a firm classed as a natural monopoly? A It will always operate in the public sector and earn normal profits. B It will have high barriers to entry…
Answer this question and get it marked →What will cause an outward shift in the demand for labour curve? A a decrease in the top rate of income tax B an increase in the demand for the final product C an increase in…
Answer this question and get it marked →The diagram shows what happens when the employees of a profit-maximising monopsonist employer form a trade union and successfully negotiate a wage rate of OWₜ. [Diagram: the…
Answer this question and get it marked →May–June 2024, Paper 32
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…
Answer this question and get it marked →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…
Answer this question and get it marked →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 --- ---…
Answer this question and get it marked →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…
Answer this question and get it marked →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…
Answer this question and get it marked →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…
Answer this question and get it marked →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…
Answer this question and get it marked →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…
Answer this question and get it marked →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…
Answer this question and get it marked →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…
Answer this question and get it marked →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…
Answer this question and get it marked →May–June 2024, Paper 33
Which statement about the concept of utility is correct? A Diminishing marginal utility means that producers become less efficient the more they produce. B If marginal utility is…
Answer this question and get it marked →The diagram shows indifference curves I₁, I₂ and a budget line T. [Diagram: vertical axis labelled 'units of X' marked from 0 to 100 in tens, horizontal axis labelled 'units of Y'…
Answer this question and get it marked →The diagram shows the cost and revenue curves for a firm. Which output level will enable a firm to achieve its objective of maximising its revenue? [Diagram: vertical axis…
Answer this question and get it marked →Oligopoly firms seek to maximise profits. How will this affect the pricing behaviour of oligopoly firms involved in a non-collusive market? A A price is fixed for the product that…
Answer this question and get it marked →Which assumption is essential for a market to be contestable? A The market is supplied by a large number of firms. B Firms are free to enter and leave the market. C Firms cannot…
Answer this question and get it marked →A firm that raises capital through a share issue has to satisfy both shareholders' expectations and management aims. The management aims to produce at a non-profit maximum output.…
Answer this question and get it marked →A major UK chemical firm was bought by its rival, a Dutch chemical firm. What definitely occurred when the Dutch firm bought the UK firm? A a partnership B economies of scale C…
Answer this question and get it marked →Which statement is correct for a firm classed as a natural monopoly? A It will always operate in the public sector and earn normal profits. B It will have high barriers to entry…
Answer this question and get it marked →May–June 2024, Paper 41
The long-term equilibrium position in perfect competition is frequently used to illustrate efficient resource allocation in a free market economy. Explain why this is so and…
Answer this question and get it marked →With the help of an indifference curve diagram, assess the extent to which a rise in price would affect the demand for a normal good differently from the demand for a Giffen good.
Answer this question and get it marked →May–June 2024, Paper 42
Explain what is meant by internal economies of scale, using an example from the information.
Answer this question and get it marked →Evaluate, with the aid of a diagram(s), whether excess profit (supernormal profit) is always necessary for the continued existence of firms in perfect competition and monopoly.…
Answer this question and get it marked →May–June 2024, Paper 43
With the help of an indifference curve diagram, assess the extent to which a rise in price would affect the demand for a normal good differently from the demand for a Giffen good.…
Answer this question and get it marked →October–November 2024, Paper 11
A firm operating in country S moved its existing capital equipment to a larger factory in country T. It also installed more of the same equipment and increased the size of its…
Answer this question and get it marked →In a particular year, 12 000 units of a good are sold at $1 per unit. In a later year, 14 000 units are sold at $1.20 per unit. If consumer tastes have remained constant, what…
Answer this question and get it marked →What is most likely to cause an increase in the consumer surplus in the market for a normal good? A an increase in consumer incomes B an increase in the number of substitute goods…
Answer this question and get it marked →The table shows Lee's and Yim's price elasticity of demand for restaurant meals and cinema tickets. Lee Yim --- --- --- restaurant meals −1.2 −0.8 cinema tickets −0.7 −1.3 There…
Answer this question and get it marked →What is not held constant when aggregating individual firms' supply curves to give the short-run market supply curve? A the number of firms in the industry B the price of the…
Answer this question and get it marked →Which elasticity would a shortage of skilled workers affect? A cross elasticity of demand B income elasticity of demand C price elasticity of demand D price elasticity of supply
Answer this question and get it marked →D₁D₁ shows an individual's initial demand curve for public transport. The diagram has the price of public transport on the vertical axis and the quantity of public transport on…
Answer this question and get it marked →October–November 2024, Paper 12
The graph shows the demand and supply curves for an industry. [Diagram: the vertical axis is labelled 'price' and the horizontal axis is labelled 'quantity', origin O. A…
Answer this question and get it marked →A firm produces a good using a very labour-intensive process. There is an increase in the price of the good. Under which conditions will the supply of the firm’s good be most…
Answer this question and get it marked →What is most likely to cause the demand curve of an inferior good to shift to the right? A a rise in consumers’ incomes B a rise in income tax C a rise in sales tax D a rise in…
Answer this question and get it marked →The diagram shows four supply curves. Which curve has a price elasticity of supply of 1 for all levels of quantity supplied? [Diagram: the vertical axis is labelled 'price' and…
Answer this question and get it marked →The diagram shows a shift of the supply curve in a market from S₁ to S₂. [Diagram: the vertical axis is labelled 'price $' and the horizontal axis is labelled 'quantity', origin…
Answer this question and get it marked →Good X has a substitute, good Y, and a complement, good Z. The price of good Y decreases and the price of good Z increases. Why might the equilibrium price of good X remain…
Answer this question and get it marked →October–November 2024, Paper 13
Shoe manufacturers often use leather to make their most expensive shoes. Due to a world shortage of leather, the price of leather has risen. What will be the effect of this price…
Answer this question and get it marked →The Chinese government relaxed controls on private house ownership. Private house ownership rose sharply, replacing demand for apartments rented from the state. What would have…
Answer this question and get it marked →The supply, S, of a product is determined by the equation S = 10 + 10P, when P is the price of the product. What is the price elasticity of supply when the price changes from $1…
Answer this question and get it marked →A good has the following elasticity values. cross elasticity of demand +1.4 --- --- income elasticity of demand −0.8 Which statement is correct? A The good is a complement and…
Answer this question and get it marked →Different areas on the diagram represent different aspects of a market. [Diagram: a demand and supply graph with 'price' on the vertical axis and 'quantity' on the horizontal…
Answer this question and get it marked →Which combination of the classification of a good and market change will cause the demand curve for the good to shift to the right? classification of good market change --- ---…
Answer this question and get it marked →October–November 2024, Paper 21
Explain the determinants of supply for an agricultural product, such as rice, and consider which of these determinants is likely to be of the greatest significance at the present…
Answer this question and get it marked →October–November 2024, Paper 22
With the help of a diagram(s), briefly explain how the cause of a movement along the demand curve differs from the cause of a shift in the demand curve and consider the impact on…
Answer this question and get it marked →October–November 2024, Paper 23
Use a demand and supply diagram to show why there was a 'huge' increase in the price of Arabica coffee beans in 2021.
Answer this question and get it marked →October–November 2024, Paper 31
The diagram shows a total utility curve for a consumer. [Diagram: vertical axis labelled 'total utility', horizontal axis labelled 'quantity', origin O. A curve starts at the…
Answer this question and get it marked →What is a characteristic of an indifference curve? A It will remain concave to the origin of the diagram. B It will remain convex to the origin of the diagram. C It can intersect…
Answer this question and get it marked →The diagram shows a firm's long-run average cost curve (LRAC). [Diagram: vertical axis labelled 'cost', horizontal axis labelled 'output', origin O. A U-shaped curve labelled…
Answer this question and get it marked →The diagram shows the average revenue (AR) and average cost (AC) curves for a firm X that manufactures electronic goods. Firm X then completes a takeover of firm Y that supplies…
Answer this question and get it marked →LMN Ltd operates as a relatively small, family-owned producer in an industry dominated by a few large firms. Its product is unique so the owners are confident they will be able to…
Answer this question and get it marked →The diagram shows the short-run average cost, SRAC, and long-run average cost, LRAC, curves for a firm producing computers. It usually produces 2000 computers per week. An…
Answer this question and get it marked →What is a characteristic of monopolistic competition? A no barriers to entry B identical products C price takers D small number of buyers and sellers
Answer this question and get it marked →What is likely to have its cause in the separation of ownership and control in a firm? A contestable markets B diseconomies of scale C principal-agent problem D prisoner's dilemma
Answer this question and get it marked →Firms X and Y merge in a horizontal integration. What must be true about the industry and the stage of production in which X and Y operate? industry stage of production --- ---…
Answer this question and get it marked →The graph shows the percentage growth in average earnings for an economy. [Diagram: bar chart with the vertical axis labelled 'average wage growth %' (scale from −4 to 4) and a…
Answer this question and get it marked →The table shows the output of chairs at a factory when different numbers of workers are employed. number of workers 0 1 2 3 4 5 --- --- --- --- --- --- --- number of chairs…
Answer this question and get it marked →In the diagram, D represents the long-run demand curve for labour in a firm operating in an imperfect market. When there is a fall in the amount of capital invested per worker,…
Answer this question and get it marked →October–November 2024, Paper 32
If consumers aim to maximise their utility, how will they arrange their spending? A to obtain the same total utility from each commodity B to obtain the same total utility per $…
Answer this question and get it marked →Which feature of indifference curve theory is most likely to apply in reality? A The consumer can express preferences between all possible combinations of goods. B The consumer…
Answer this question and get it marked →Diagrams 1 and 2 show different long-run average cost curves (LRAC). [Diagram 1: vertical axis labelled 'cost', horizontal axis labelled 'output', origin O. A single curve…
Answer this question and get it marked →The table shows the market shares of firms selling a very similar product in a country between 2018 and 2020. firm 2018 2020 --- --- --- Norton 28.4 27.4 Souton 18.9 17.6 Eastern…
Answer this question and get it marked →The diagram shows a profit maximising firm in equilibrium. [Diagram: vertical axis labelled '$', horizontal axis labelled 'quantity', origin O. A downward-sloping straight line…
Answer this question and get it marked →A bus company has a monopoly and specialises in long-distance travel. It initially sells its tickets to customers one month in advance of the journey. As the departure date…
Answer this question and get it marked →Firm X is considering whether to co-operate with its rival so that their joint profit is $4000 a month ($2000 each). It calculated that, if it did not co-operate, its own profit…
Answer this question and get it marked →A smartphone manufacturing company takes over an electronic chip design company. This is an example of which type of growth? A horizontal B lateral C vertical backwards D vertical…
Answer this question and get it marked →In which situation is the introduction of a minimum wage most likely to raise employment opportunities as well as wages? A Firms face intense competition both at home and abroad.…
Answer this question and get it marked →The diagram shows a firm’s initial marginal revenue product of labour curve (MRP₁). [Diagram: vertical axis labelled 'marginal revenue product of labour', horizontal axis labelled…
Answer this question and get it marked →A firm operates in a perfectly competitive labour market. The table shows the marginal revenue product (MRP) and marginal cost of labour (MCL) for each additional worker employed…
Answer this question and get it marked →October–November 2024, Paper 33
A rational consumer chooses what quantities of two products Y and Z to purchase with a given income. MUY and MUZ are the additions to total utility that would result if the…
Answer this question and get it marked →Which statement about indifference curves is not correct? A Indifference curves are usually convex to the origin of the diagram. B Indifference curves can intersect each other. C…
Answer this question and get it marked →A firm increases its production. When will this result in allocative efficiency? A when the cost of producing the last extra unit equals the value the consumers place on it B when…
Answer this question and get it marked →The table shows a firm's revenue and costs at different levels of output. output marginal revenue average revenue marginal cost average total cost --- --- --- --- --- 1 125 125 90…
Answer this question and get it marked →Which diagram shows a monopolistically competitive firm in long-run equilibrium? Each of the four diagrams A, B, C and D has a vertical axis labelled 'revenue/cost', a horizontal…
Answer this question and get it marked →In a perfectly contestable market, entries and exits are cost-free. In reality, why is this not the case with some firms in contestable markets? A Firms cannot recover all fixed…
Answer this question and get it marked →Which points show where each maximisation objective occurs? [Diagram: vertical axis labelled 'cost or price $', horizontal axis labelled 'quantity', origin O. A marginal cost…
Answer this question and get it marked →What is an external economy of scale? A cheaper costs from purchasing large quantities of inputs B decreased interest rates on borrowed funds C increased labour productivity D…
Answer this question and get it marked →A group of producers enter into an agreement to restrict supply or fix the price of a good. What does this describe? A a cartel B a conglomerate merger C economies of scale D…
Answer this question and get it marked →What is meant by a four-firm concentration ratio of 25%? A The largest four firms' market share totals 25%. B The largest four firms have a market share of 25% each. C There are…
Answer this question and get it marked →October–November 2024, Paper 41
Evaluate the consequences for the price and output of a firm if it changes its objective from profit maximisation to sales maximisation as a response to the principal-agent…
Answer this question and get it marked →October–November 2024, Paper 42
Identify the relationship between the variables shown in Fig. 1.1 and suggest one possible reason for the relationship.
Answer this question and get it marked →Evaluate whether marginal utility theory can fully explain the link between the changing price of a good and quantity demanded of that good. [20]
Answer this question and get it marked →October–November 2024, Paper 43
Wages in a perfectly competitive labour market will always be higher than wages in a monopsony labour market. With the help of a diagram, evaluate this statement. [20]
Answer this question and get it marked →May–June 2023, Paper 11
Which row correctly describes the relationship between two goods implied by the value of the cross elasticity of demand? value of the cross elasticity of demand description ---…
Answer this question and get it marked →What does consumer surplus measure? A the excess profit earned by the producer of a good B the opportunity cost to the consumer of not buying a good C the price the marginal…
Answer this question and get it marked →When the price of good X is $2.00, the quantity supplied is 100 000. The price elasticity of supply of good X is 0.8 in the short run and 1.4 in the long run. The price of good X…
Answer this question and get it marked →The diagram shows the European market for diesel fuel and the original equilibrium is at M. [Diagram: the vertical axis is price and the horizontal axis is quantity, with origin…
Answer this question and get it marked →In which situation is the demand for a product said to be price elastic? A The quantity demanded responds to a change in price. B An increase in price brings about a decrease in…
Answer this question and get it marked →Golf club membership fees in Singapore have risen as a result of restrictions on travel to cheaper golf courses in neighbouring countries and the closure of some local courses.…
Answer this question and get it marked →The diagram shows the demand and supply curves for solar energy in India. The initial equilibrium point is at X. The Indian government increases the subsidy to solar energy…
Answer this question and get it marked →May–June 2023, Paper 12
Price plays a number of functions in the allocation of resources. Which statement best illustrates the function that relies upon consumer choice (sometimes known as the…
Answer this question and get it marked →Which pair of products are substitutes both in consumption and production? A barley and cotton B gold and silver C soap and toothpaste D spinach and cabbage
Answer this question and get it marked →The cross elasticity of demand between bus travel and rail travel is +2. A rise in the price of bus fares caused the demand for rail travel to rise by 10%. Which change in bus…
Answer this question and get it marked →A change in the price of a good causes an increase in the quantity of the good demanded. What would be the nature of the good and the direction of price change for this to be…
Answer this question and get it marked →The diagram shows the supply curve of a firm. Which statement about the price elasticity of supply (PES) along this curve is correct? A PES is greater than unity at all points…
Answer this question and get it marked →The diagram shows the market for electric cars with X as the initial equilibrium. What will be the new equilibrium when the price of electric car batteries falls and consumers…
Answer this question and get it marked →What would cause a market disequilibrium? A when a decrease in the demand for a product leads to a price fall that results in some producers leaving the market B when a decrease…
Answer this question and get it marked →In the diagram, area OP1M1Q1 is equal to area OP2M2Q2. What is the value of the price elasticity of demand if the price is halved from P1 to P2? A −1 B −0.5 C zero D infinity
Answer this question and get it marked →The table shows changes in a consumer's expenditure on various goods when her income increases from $20 000 to $24 000. good income $20 000: amount spent on good ($) income $24…
Answer this question and get it marked →May–June 2023, Paper 13
When is the price elasticity of demand for a product most likely to be price elastic? A A large percentage of income is spent on the product. B It is measured in the short run. C…
Answer this question and get it marked →What is most likely to cause a shift in the supply curve for rice? A a change in the price of the rice B a change in the price of meat C a change in the size of the rice industry…
Answer this question and get it marked →A free market is in disequilibrium with a shortage of a product. As the market moves towards equilibrium, what will happen to the price, the quantity demanded and the quantity…
Answer this question and get it marked →What would not cause a shift in the demand curve for a good? A a change in the price of a complement B a change in the price of a substitute C a change in the price of the good…
Answer this question and get it marked →What does joint supply mean? A A firm can choose between producing a range of different goods. B A good has multiple uses. C A good is a by-product of the production process of…
Answer this question and get it marked →When the price of a firm's product falls by 5%, its total revenue also falls by 5%. What describes the product's price elasticity of demand? A elastic B infinite C unitary D zero
Answer this question and get it marked →The table shows how an individual's weekly consumption of biscuits and coffee varies with income. income ($) biscuits (packs) coffee (cups) --- --- --- 100 0 5 150 5 10 Which…
Answer this question and get it marked →The diagram shows four supply curves. [Diagram: 'price' on the vertical axis and 'quantity' on the horizontal axis, with origin O. Four supply curves labelled W, X, Y and Z pass…
Answer this question and get it marked →Product X has a price elasticity of supply (PES) of +2, whilst product Y has a PES of +0.2. Which statement about products X and Y is correct? A X has more substitutes than Y. B A…
Answer this question and get it marked →May–June 2023, Paper 21
With the help of a formula, explain the meaning of cross elasticity of demand and consider which determinants are most important in establishing the size and sign of its…
Answer this question and get it marked →May–June 2023, Paper 22
With the help of a diagram(s), explain what is meant by consumer surplus and producer surplus and consider whether a rise in the price of a product because of higher costs of…
Answer this question and get it marked →With the help of a diagram(s), explain what is meant by equilibrium in a market and consider the extent to which the equilibrium price and equilibrium quantity are likely to…
Answer this question and get it marked →May–June 2023, Paper 23
Using the data in Fig. 1.1, calculate the percentage change in the value of sales of doughnuts in the US from 2011 to 2019.
Answer this question and get it marked →Explain, with the help of examples, the significance of the size and sign of the coefficient of income elasticity of demand for the classification of a good and consider how…
Answer this question and get it marked →May–June 2023, Paper 31
What does the marginal utility diagram show? [Diagram: vertical axis labelled 'utility', horizontal axis labelled 'quantity', origin O. A single straight line slopes downward from…
Answer this question and get it marked →The initial allocation of goods between three consumers is shown. consumer 1 consumer 2 consumer 3 total --- --- --- --- 2 5 10 17 Which row shows a Pareto improvement in the…
Answer this question and get it marked →Which assumption in relation to an indifference theory diagram is not correct? A The consumer's income may change. B The consumer may change their satisfaction-maximising…
Answer this question and get it marked →Which type of efficiency is shown by the shift from long-run average cost curve 1 (LRAC₁) to long-run average cost curve 2 (LRAC₂)? [Diagram: vertical axis labelled 'price',…
Answer this question and get it marked →A firm wishes to maximise its revenue. Which condition must be met to achieve this goal? A average cost = average revenue B marginal cost = average revenue C marginal cost =…
Answer this question and get it marked →The costs and revenue of four firms operating in a monopolistically competitive market are shown. firm total variable cost $m total fixed cost $m total revenue $m --- --- --- ---…
Answer this question and get it marked →A firm at its current level of production finds that its short-run marginal cost is less than its short-run average variable cost. Which conclusion about the firm can be drawn…
Answer this question and get it marked →Steel producer X takes over its main competitor, steel producer Y. What would X expect to happen to the price elasticity of demand for its product and its long-run average cost as…
Answer this question and get it marked →What would definitely result from the divorce of ownership and control? A decreased moral hazard B the principal agent problem C greater productive efficiency D increased profit…
Answer this question and get it marked →The diagram illustrates a monopsony labour market in which the government has imposed a minimum wage. [Diagram: vertical axis labelled 'wage rate', horizontal axis labelled…
Answer this question and get it marked →Economics textbooks state that labour is a derived demand for a firm in imperfect competition. How is the demand curve for labour derived? A by multiplying the average physical…
Answer this question and get it marked →May–June 2023, Paper 32
The diagram shows an individual’s indifference curve, I₁, for apples and pears. [Diagram: vertical axis 'apples', horizontal axis 'pears'. A single indifference curve I₁, convex…
Answer this question and get it marked →What is not necessary for successful price discrimination? A ability to separate markets B different price elasticities of demand in each market C monopoly power D price leadership
Answer this question and get it marked →The diagram shows the cost curves of a firm. [Diagram: vertical axis 'cost or price $', horizontal axis 'quantity' with four output levels labelled A, B, C and D from left to…
Answer this question and get it marked →Steel producer X takes over its main competitor, steel producer Y. What would X expect to happen to the average revenue for its product and its long-run average cost as a result…
Answer this question and get it marked →A privately owned sole supplier of gas operates in an unregulated market with high barriers to entry and exit. Which row is most likely to indicate the economic efficiency…
Answer this question and get it marked →A government increases the protection that patents offer to inventors of new products and processes. Which barriers to entry into an industry are higher as a result of this…
Answer this question and get it marked →The table shows how a firm’s total cost changes as more workers are employed. number of workers total costs $ --- --- 1 1200 2 2000 3 2700 What would be the effect of employing a…
Answer this question and get it marked →What will lead the demand curve for labour to shift to the right? A a decrease in the marginal productivity of labour B a decrease in the wage rate C an increase in the marginal…
Answer this question and get it marked →The production schedule indicates how total output increases as up to five workers are employed per week. employment of workers total product (units) --- --- 0 0 1 6.0 2 13.0 3…
Answer this question and get it marked →May–June 2023, Paper 33
What does the marginal utility diagram show? [Diagram: axes of 'utility' (vertical) and 'quantity' (horizontal), with origin O. A downward-sloping straight line, labelled…
Answer this question and get it marked →The initial allocation of goods between three consumers is shown. consumer 1 consumer 2 consumer 3 total --- --- --- --- 2 5 10 17 Which row shows a Pareto improvement in the…
Answer this question and get it marked →Which assumption in relation to an indifference theory diagram is not correct? A The consumer's income may change. B The consumer may change their satisfaction-maximising…
Answer this question and get it marked →Which type of efficiency is shown by the shift from long-run average cost curve 1 (LRAC1) to long-run average cost curve 2 (LRAC2)? [Diagram: axes of 'price' (vertical) and…
Answer this question and get it marked →A firm wishes to maximise its revenue. Which condition must be met to achieve this goal? A average cost = average revenue B marginal cost = average revenue C marginal cost =…
Answer this question and get it marked →The costs and revenue of four firms operating in a monopolistically competitive market are shown. firm total variable cost $m total fixed cost $m total revenue $m --- --- --- ---…
Answer this question and get it marked →A firm at its current level of production finds that its short-run marginal cost is less than its short-run average variable cost. Which conclusion about the firm can be drawn…
Answer this question and get it marked →Steel producer X takes over its main competitor, steel producer Y. What would X expect to happen to the price elasticity of demand for its product and its long-run average cost as…
Answer this question and get it marked →What would definitely result from the divorce of ownership and control? A decreased moral hazard B the principal agent problem C greater productive efficiency D increased profit…
Answer this question and get it marked →The diagram illustrates a monopsony labour market in which the government has imposed a minimum wage. [Diagram: axes of 'wage rate' (vertical) and 'quantity of labour'…
Answer this question and get it marked →Economics textbooks state that labour is a derived demand for a firm in imperfect competition. How is the demand curve for labour derived? A by multiplying the average physical…
Answer this question and get it marked →May–June 2023, Paper 41
The article refers to concentration ratios. Explain what is meant by a concentration ratio and how it is calculated.
Answer this question and get it marked →Some firms frequently use price discrimination. Assess the view that when this occurs, price discrimination will always benefit the producer at the expense of the consumer and…
Answer this question and get it marked →May–June 2023, Paper 42
Evaluate, with the help of a diagram(s) how total market demand and minimum efficient scale may determine the form of market structure in an industry. [20]
Answer this question and get it marked →May–June 2023, Paper 43
The article refers to concentration ratios. Explain what is meant by a concentration ratio and how it is calculated.
Answer this question and get it marked →October–November 2023, Paper 11
Which statement correctly describes the area of producer surplus on a demand and supply diagram? A It is above the supply curve and below the equilibrium price line. B It is above…
Answer this question and get it marked →The diagram shows a demand curve for pineapples. [Diagram: axes 'price ($)' (vertical, marked 0, 0.5, 1, 1.5, 2) and 'quantity (000s)' (horizontal, marked 0, 3, 6, 9, 12). A…
Answer this question and get it marked →In a free market, there is a surplus of a good. Which change would cause the market to come to an equilibrium? A a decrease in demand B a fall in price C a government minimum…
Answer this question and get it marked →The cross-elasticity of demand between good P and good Q is −0.4. The cross-elasticity of demand between good P and good R is +0.6. Which combination of goods is most likely to be…
Answer this question and get it marked →The supply, S, of a product is determined by the equation S = 10 + 10P where P is the price of the product in $. What is the product's price elasticity of supply when its price…
Answer this question and get it marked →In the diagram, the supply curve shows the number of spaces in a car park and the demand curves show the demand for spaces on four different days, D1, D2, D3 and D4. [Diagram:…
Answer this question and get it marked →The table shows the demand schedule for textbooks. price $ quantity demanded --- --- 50 0 40 100 30 200 20 300 10 400 0 500 What can be concluded from this information? A Profit…
Answer this question and get it marked →Which event is most likely to enable firms to respond to an increase in demand by increasing supply rather than by raising price? A Firms reduce their expenditure on the training…
Answer this question and get it marked →In the diagram, S1 is the supply curve and D1 is the initial demand for facemask X. A rival firm produces facemask Y, which is a close substitute. [Diagram: axes 'price of…
Answer this question and get it marked →October–November 2023, Paper 12
Rice and pasta are both basic foods in a country. How would a health scare concerning rice affect the market for pasta? A There will be a shift of demand and a contraction of…
Answer this question and get it marked →A family is willing to pay a maximum of $600, $500 and $400 for air tickets for the mother, father and daughter to attend a wedding in another city. The airline announces a…
Answer this question and get it marked →After a 10% decrease in a consumer’s income, the consumer’s demand for a good rises from 100 to 105. What is the value of the consumer’s income elasticity of demand for this good?…
Answer this question and get it marked →In 2010, poor harvests reduced fruit crops and furniture producers gave big discounts on furniture products. How might these changes have affected the position of the supply curve…
Answer this question and get it marked →In the diagram, D and S represent the demand for and supply of smartphones. Many components used in the production of smartphones are imported. The initial equilibrium is at point…
Answer this question and get it marked →The diagrams show the demand for and the supply of houses. In the short run, the stock of houses for sale, S1, is fixed. A government decides to allow some agricultural land to be…
Answer this question and get it marked →The equation for the quantity demanded, QD, for a product is QD = 400 − 20P where P = price in $. The quantity supplied, QS, is given by QS = 100 + 40P. Which change will occur if…
Answer this question and get it marked →What is the most likely cause of the continuous increase in prices of famous paintings by now dead artists? A the increasing technological ability to copy famous paintings…
Answer this question and get it marked →October–November 2023, Paper 13
The diagram shows the market for computers in Pakistan. On the diagram the vertical axis is labelled 'price' and the horizontal axis 'quantity', with origin O. A demand curve…
Answer this question and get it marked →The supply curve for a firm is a horizontal straight line. What can be concluded from this statement? A Quantity supplied is infinite at the given price. B Quantity supplied is…
Answer this question and get it marked →When the incomes of consumers of good X fall by 5%, under which conditions will the demand curve shift furthest to the right? nature of good X income elasticity of demand for good…
Answer this question and get it marked →Good P and good Q are substitutes. There is a decrease in supply of good P because of a shortage of materials. Which row describes what will happen to demand? good P good Q ---…
Answer this question and get it marked →The pressure to reduce the use of fossil fuels has led to oil companies reducing the level of investment in the exploration of new reserves. What will be the long-run effect of…
Answer this question and get it marked →The price elasticity of demand for a product is −0.6. The supplier wants to clear all surplus stock of a product and reduces the price of a good by 50%. What is the effect of this…
Answer this question and get it marked →A firm is producing 100 units at a price of $10. The price elasticity of supply is 0.5 and the price is raised to $12. What is the new level of output? A 75 B 110 C 125 D 150
Answer this question and get it marked →In a town, bus fares fall by 50% and this leads to an increase in bus use by 30%. The effect on car use is very low with only a 1% reduction. What is the value of the…
Answer this question and get it marked →October–November 2023, Paper 21
With the help of a diagram, explain what could cause an increase in demand for a product and consider whether the impact of an increase in demand on the price of the product will…
Answer this question and get it marked →October–November 2023, Paper 22
Using the data in Table 1.1, calculate the percentage change in the average real global price of oil between 2014 and 2020.
Answer this question and get it marked →With the help of a formula, explain what is meant by the term price elasticity of demand for a product and consider the extent to which it allows an entrepreneur to determine the…
Answer this question and get it marked →October–November 2023, Paper 23
The price elasticity of supply (PES) for a new smartphone is estimated to be 0.8 in the short run and 1.8 in the long run. Explain what these estimates mean for producers and…
Answer this question and get it marked →October–November 2023, Paper 31
Economists normally assume that the marginal utility from consuming additional goods is positive and diminishing. What is the effect on total satisfaction of consuming extra units…
Answer this question and get it marked →A budget line (b–b) shows the combinations of two goods, X and Y, that a consumer can obtain within a fixed income of $60 per week, when the price of Y = $1 and X = $2. [Diagram:…
Answer this question and get it marked →Which market structures are contestable? perfect competition monopolistic competition pure monopoly --- --- --- --- A no no yes B no yes yes C yes no no D yes yes no A combination…
Answer this question and get it marked →The diagram shows a long-run average cost curve (LRAC), and three short-run average cost curves (SRAC₁, SRAC₂ and SRAC₃) for an individual firm. Each short-run average cost curve…
Answer this question and get it marked →Which combination of reactions by rivals results in a kinked demand curve for an oligopolist when a price is changed? A copying both a price rise and a price fall B copying a…
Answer this question and get it marked →What is a key condition for effective price discrimination? A The product cannot be resold to another consumer. B The product must be price inelastic. C The profits from one…
Answer this question and get it marked →Which combination of cost conditions is most likely to act as a barrier to entry to a new firm wanting to join an industry? fixed costs as a proportion of total costs minimum…
Answer this question and get it marked →How is dynamic efficiency represented on a diagram? A a downward move to the minimum point of a long-run average cost curve B a downward shift in the long-run average cost curve C…
Answer this question and get it marked →A firm is faced with a shortage of labour. It decides to introduce its own training scheme for school leavers. Which effect is this most likely to have on the firm? A a decrease…
Answer this question and get it marked →October–November 2023, Paper 32
The diagram shows the total utility of consumers Y and Z when each consumes bars of chocolate. [Diagram: vertical axis labelled 'total utility', horizontal axis labelled 'number…
Answer this question and get it marked →When choosing to buy two products, the satisfaction gained by the consumption of different combinations of these two products can be represented by an indifference curve. Which…
Answer this question and get it marked →The merger of two large firms in the Singapore market supplying taxis and private hire vehicles resulted in a single firm with 80% of the market. The remaining 20% of the market…
Answer this question and get it marked →The diagram shows the cost and revenue curves of a profit-maximising, monopolistically competitive firm in long-run equilibrium. [Diagram: vertical axis labelled 'costs, revenue',…
Answer this question and get it marked →A firm changes its aim and chooses to produce where marginal revenue (MR) is zero instead of where MR is equal to marginal cost (MC). Which explanation for this is not correct? A…
Answer this question and get it marked →A firm operating in the airline industry uses third degree price discrimination. Which condition is most likely to allow this to happen? A Consumers are able to buy cheaply and…
Answer this question and get it marked →Firm K operates in a competitive market. Firm L is a monopsony employer. Both firms are operating at an equilibrium level of output. Trade unions are introduced with the result…
Answer this question and get it marked →A backward-sloping supply curve of labour is one where, beyond a certain point, the supply of labour A decreases as the demand for labour rises. B increases as the demand for…
Answer this question and get it marked →Which government policy is most likely to improve occupational mobility? A decreased income tax rates B increased government spending on education and training C increased…
Answer this question and get it marked →October–November 2023, Paper 33
The diagram shows the marginal utility (MU) from the consumption of quantities of good X. [Diagram: axes of 'marginal utility' (vertical, scaled 0 to 10) and 'quantity of X'…
Answer this question and get it marked →An indifference curve is typically drawn with a convex shape. Which economic concept explains the reason for this convex shape? A allocative efficiency B diminishing marginal rate…
Answer this question and get it marked →What is most likely to increase the principal–agent problem? A ensuring the actions of agents are known by the managers B linking the rewards of managers with the profitability of…
Answer this question and get it marked →The table shows a firm's total fixed cost and total variable cost. output total fixed cost $ total variable cost $ --- --- --- 1 1000 1000 2 1000 2000 3 1000 3000 4 1000 4000 5…
Answer this question and get it marked →The world's largest coffee restaurant chain purchased a large coffee bean farm in Costa Rica. The farm has research and development facilities to study specific diseases that…
Answer this question and get it marked →Which condition is necessary for a firm to practise third degree price discrimination effectively? A All consumers and producers must be in the same geographical location. B…
Answer this question and get it marked →Which conditions are most likely to reduce the accuracy of cost-benefit analysis in decision making? proportion of external costs and benefits to total costs and benefits % of…
Answer this question and get it marked →What is consistent with a movement towards Pareto optimality? A when negative externality lowers the utility of an individual B when consumption of a good is non-rival C when…
Answer this question and get it marked →The diagram shows the short-run supply curve and long-run supply curve of labour. [Diagram: axes 'wage rate' (vertical) and 'quantity of labour' (horizontal), with origin O. An…
Answer this question and get it marked →What is most likely to increase relative poverty in a country? A increasing means-tested benefit levels B increasing the power of trade unions C making the tax system more…
Answer this question and get it marked →October–November 2023, Paper 41
A government allows the merger of two large firms in the same industry. With the help of a diagram, evaluate the view that this merger should not have been allowed.
Answer this question and get it marked →October–November 2023, Paper 42
Explain what is meant by equity and how the ban on motorcycle taxis and tricycles affects equity for commuters in Lagos.
Answer this question and get it marked →Evaluate the use of indifference curve analysis to derive the demand curve for a normal good and the demand curve for an inferior good. [20]
Answer this question and get it marked →The model of perfect competition is the ideal form of market structure because it is the most efficient. With the help of diagrams, evaluate this statement. [20]
Answer this question and get it marked →October–November 2023, Paper 43
Evaluate the view that monopolistically competitive firms will always charge lower prices and operate more efficiently than a monopoly firm. [20]
Answer this question and get it marked →