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ECONOMICS Paper 2 (IGII)

The document is a structured exam paper for an economics midterm, consisting of three main questions with various parts focusing on concepts such as opportunity cost, demand elasticity, and the economic implications of specialization. Each question requires students to define terms, explain economic problems, analyze market effects, and discuss future trends in specific industries. The exam lasts 1.5 hours and allows students to attempt any two questions.

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53 views1 page

ECONOMICS Paper 2 (IGII)

The document is a structured exam paper for an economics midterm, consisting of three main questions with various parts focusing on concepts such as opportunity cost, demand elasticity, and the economic implications of specialization. Each question requires students to define terms, explain economic problems, analyze market effects, and discuss future trends in specific industries. The exam lasts 1.5 hours and allows students to attempt any two questions.

Uploaded by

haziqbintariq10
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as PDF, TXT or read online on Scribd
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ECONOMICS 0455/22

Paper 2 Structured Questions Midterm exam 2023

1:30 hours

Attempt any two Questions:

1. The economic problem results in choices and opportunity cost. People have to decide what job to do and
where to live. In recent years Australia has recruited teachers from a number of countries including Canada,
the UK and the US. Most of these teachers specialise in a single subject.

(a) Define opportunity cost. [2]


(b) Explain the economic problem and why it is always likely to exist. [4]
(c) Analyse why the wages of all teachers may increase. [6]
(d) Discuss whether or not a teacher would benefit from specialisation. [8]

2. Demand for bank loans and for cars is changing, in part, due to changes in population size. It is predicted
that the price elasticity of demand (PED) for cars will also change in the future.

(a) What is meant by an “extension in demand”. [2]


(b) Explain the difference elastic supply and inelastic supply. [4]
(c) Analyse, using a demand and supply diagram, the effect on the market for furniture of an increase in the
price of wood. [6]
(d) Discuss whether or not demand for cars will become more price-elastic in the future. [8]

3. The main industries in the Seychelles, an island country in the Indian ocean, are tourism and fishing. The
price elasticity of supply of fish is affected by the relatively short time that fish can be stored. Economic
goods and free goods play a role in both fishing and tourism. With rises in the skills of workers and an
increase in enterprise, GDP per head has increased by more than seven times over the last fifty years.

(a) State the formula for calculating the price elasticity of supply (PES). [2]
(b) Explain how opportunity cost is different for economic goods and free goods. [4]
(c) Analyse, using a production possibility curve (PPC) diagram, the effect of an increase in enterprise on an
economy. [6]
(d) Discuss whether or not demand for coffee is likely to rise in the future. [8]

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