HALF YEARLY EXAMINATION 2021

Grad Centre Teacher’s Name

Date Student’s Name Roll No.
e No.

26/11/2021 9 IN 693 Ms. Shantala

Additional Material – MCQ Answer sheets

Subject Subject Code Component No. Duration Maximum Marks

Economics 0455 12 30 minutes 20

General Instructions:

● All answers to be written, scanned and uploaded on Exam.Net.

● 15 Minutes of extra time for scanning & uploading to be permitted by the invigilator.

● Scanning of answer sheets needs to be done in portrait form only

● QR Scanner to be downloaded on the mobile for scanning.

● On submitting the scanned answer script, candidate to receive a copy of the same via email. This needs to be
checked and confirmed by the candidate via email.

Subject Specific Instructions:

● Write in soft pencil.

● Write your name and Roll number on the Answer Sheet in the spaces provided.

● There are twenty questions on this paper. Answer all questions. For each question there are four possible
answers A, B, C and D.
● Choose the one you consider correct and record your choice in soft pencil on the separate Answer Sheet.

● Use of calculator is permitted

Read the instructions on the Answer Sheet very carefully.

● Each correct answer will score one mark. A mark will not be deducted for a wrong answer.

Total
Maximum
20
Marks
Marks Obtained
 For Examiner’s Use only

This document consists of 8 printed pages and one blank page.

1 What is an example of the purchase of a consumer good?

A A farm owner buys a television.
B A farm owner buys additional land.
C A farm owner buys fertilizer for their crops.
D A farm owner buys some farming equipment.

2 What does an economist mean by the factor of production called capital?

A goods that can be used to produce other goods
B money used to start a business
C resources that cannot be replaced
D the profits of a company

3 The diagram shows a production possibility curve (PPC) for an economy that can
produce cotton and cars. The economy is at point Q.

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 There is improved technology that can only be used in the production of cars.
How would this be represented on this diagram?
A by a movement from Q to W
B by a movement from Q to X
C by a movement from Q to Y
D by a movement from Q to Z

4 The diagram shows the market for a good. The equilibrium is at point X. The
government fixes a minimum price for the good at P2

What will happen in the market as a result?

A The market equilibrium will remain the same.
B The quantity demanded will rise to Q2.
C The quantity supplied will fall to Q3.
D There will be an excess supply.

5 What aspect of demerit goods means they are overproduced?

A clear product information
B high external costs
C high product taxes
D low customer demand

6 What is found in a mixed economy but not in a free market economy?

A equilibrium prices
ECONOMICS PAPER 12 Page 3 of 9 HALF YEARLY EXAMINATION 2021
 B income tax
C small firms
D the profit motive

7. A product has a high price elasticity of supply. What might explain this?

A The product has a high opportunity cost.

B The product has a non-perishable nature.
C The product is classed as an inferior good.
D The product is considered to be a luxury

8. The diagram shows the production possibility curve (PPC) of an economy producing at
point X.

What would be the opportunity cost of moving from point X to produce only consumer
goods?
A 60 units of consumer goods
B 70 units of capital goods
C 100 units of capital goods
D 180 units of consumer goods

9 Economics is divided into two: microeconomics and macroeconomics.

● statement 1 When the price of oil falls there is an expansion in demand.

● statement 2 The Organization of the Petroleum Exporting Countries (OPEC) can

influence the price of oil.

Which combination correctly describes these two statements?

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10 What is a disadvantage of a market economic system?

A Entrepreneurs lack incentives to produce what consumers want.

B Government intervention will reduce the efficiency of firms.
C Market dominance by firms can lead to higher prices.
D There is underproduction of demerit goods.

11 The diagrams show different conditions of demand and supply for a product. In which
diagram would market price remain unchanged if consumers’ incomes fell?

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12. In an African country with large areas of tropical desert the price elasticity of demand for
salt is highly inelastic. This will result in greater consumer expenditure on salt when
price changes from P1 to P2.
Which diagram illustrates this situation?

13 A friend said his French grandmother kept switching off the lights but left the tap
running. His Namibian relative left the lights on while shouting at him to turn off the
water.
Which availability of resources and level of prices would make economic sense of these
consumer actions?

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14 A government chose to spend profits from oil on stocks, bonds and property. The
possibility of improving domestic infrastructure, therefore, was not considered.

Which economic concept does this best illustrate?

A cost of production
B supply and demand of factors
C opportunity cost
D production possibility frontier

15. A large supermarket applied to build on land which was an area of natural beauty. The
local government allowed the building, even though the natural beauty of the area
would be lost, because many jobs would be created and much needed income would
be brought to the local community.

Which economic ideas cannot be found in the above statement?

A external cost and private enterprise

B free market and the conservation of resources
C opportunity cost and improved standards of living
D public sector and external benefit

16 For what would price elasticity of demand be used?

A calculating current disposable income
B calculating the rate of price inflation
C estimating changes in a company’s cost
D identifying changes in consumer spending patterns

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17. What is an external benefit when a charge is made for vehicles entering a city centre?
A increased government revenue
B increased traffic
C reduced air pollution
D reduced business activity

18 The diagram shows the market for a firm making clothing with an initial equilibrium of X.
What will be the new equilibrium if there is a successful advertising campaign by a rival
firm and an increase in workers’ wages?

19 Coal production in the UK has declined in recent years. One reason given for this is that
the social cost of coal production is too high.

What best describes the social cost of coal production?

A all the benefits of coal production minus all the costs of coal production
B the cost of the environmental damage caused by coal production
C the cost to the government of subsidizing the coal industry
D the private costs of coal production plus the external costs of coal production

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20 A mobile phone operator increases the price of making calls on its network, After the
price increase, the revenue of the mobile phone operator falls by 10%.

BLANK PAGE

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