Cambridge IGCSE Economics 0455 — 2015 May/June Paper 1 · Variant 1
0455/11/M/J/15 · 30 questions · 30 marks · ≈34 min
The question paper and its mark scheme, free to read here and free to download. This is Cambridge’s own paper, exactly as it was sat.
Question paper12 pages
Mark scheme2 pages
Answers below. Sit the paper first if you are practising.
Questions as text
Q1 · The following are four ways factors of production are used
1 The following are four ways factors of production are used. What is likely to require the greatest use of the factor enterprise? A a carpenter making wooden articles in his leisure time for sale at a monthly market B a corn farmer negotiating with other farmers to hire expensive machinery C a food shop owner sometimes selling flowers in the shop D a householder harvesting vegetables grown at home
Mark scheme: B
Q2 · To help reduce the price of oil, new supplies are needed
2 To help reduce the price of oil, new supplies are needed. However, in 2013, objectors opposed attempts to explore new sites because of the environmental damage the exploration might cause. How does this illustrate the basic economic problem? A Oil is a limited resource. B Oil is expensive. C The exploration involves demand and supply. D There are external costs involved in production.
Mark scheme: A
Q3 · With a given level of resources, an economy that can produce food or computers is at…
3 With a given level of resources, an economy that can produce food or computers is at point Q on its production possibility curve. Population growth means more resources need to be allocated to food production. At which point in the short term will the economy be in the diagram? B A Q output D of food C O output of computers
Mark scheme: B
More questions on Production possibility curve (PPC) diagrams
Q4 · A person makes sandwiches at home for five hours each day
4 A person makes sandwiches at home for five hours each day. She makes 20 sandwiches per hour, and she sells each sandwich for $2 each. What is the opportunity cost if she takes a holiday on a working day? A $2 B $40 C 20 sandwiches D 100 sandwiches
Mark scheme: D
Q5 · What can be found in a mixed economy but not in a market economy?
5 What can be found in a mixed economy but not in a market economy? A a national economic development plan B an unequal distribution of income and wealth C the operation of the price mechanism D the private ownership of factors of production
Mark scheme: A
Q6 · Newspapers recently reported there had been a decrease in the demand for beef and that…
6 Newspapers recently reported there had been a decrease in the demand for beef and that its price per kilogram had increased. From the initial equilibrium point X, which point in the diagram illustrates the new market equilibrium? S2 B A S1 price S3 X C D D2 D1 D3 O quantity
Mark scheme: A
Q7 · The diagram shows the market for fresh fish in the Caribbean with equilibrium point X
7 The diagram shows the market for fresh fish in the Caribbean with equilibrium point X. A new type of fishing boat increases production, which reduces costs. Which point represents the new equilibrium? S3 S1 S2 B A price X C D D2 D1 O quantity
Mark scheme: D
Q8 · A large supermarket applied to build on land which was in an area of natural beauty
8 A large supermarket applied to build on land which was in 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
Mark scheme: B
Q9 · Cigarettes have been used as money in exceptional circumstances
9 Cigarettes have been used as money in exceptional circumstances. What is the most likely reason that they are not acceptable as money in normal circumstances? A cigarettes lack durability B cigarettes lack intrinsic value C cigarettes lack portability D cigarettes lack uniformity
Mark scheme: A
Q10 · The table shows a country’s trade union membership in millions between 2008 and 2011
10 The table shows a country’s trade union membership in millions between 2008 and 2011. trade union trade union members in the members in the year private sector public sector (millions) (millions) 2008 8.4 3.6 2009 6.6 4.2 2010 5.1 6.0 2011 3.4 7.1 What can be concluded about the country’s trade union membership in the period 2008 to 2011? A Trade unions had least members in 2010. B Trade unions had most members in 2011. C Trade union membership fell between 2008 and 2009. D Trade union membership rose between 2009 and 2011.
Mark scheme: C
Q11 · A bus driver works longer hours if the wage rate increases
11 A bus driver works longer hours if the wage rate increases. As his earnings increase there reaches a point when he prefers more leisure to work. Which supply curve, S, represents this situation? A B C D S S wage S wage wage wage S rate rate rate rate O worker O worker O worker O worker hours hours hours hours
Mark scheme: C
Q12 · In 2013, a German company that manufactured medicines bought a UK company that ran a…
12 In 2013, a German company that manufactured medicines bought a UK company that ran a chain of pharmacies that sold medicines. What term best describes this takeover? A conglomerate B horizontal C vertical integration backwards D vertical integration forwards
Mark scheme: D
Q13 · When is a firm considered more capital-intensive than another firm?
13 When is a firm considered more capital-intensive than another firm? A when it has a lower ratio of workers to machines than the other firm B when it has fewer workers than the other firm C when it has higher variable costs than the other firm D when it has more machines than the other firm
Mark scheme: A
Q14 · In 2009, Gulf Airlines, which was making a loss, stated it would reduce the number of new…
14 In 2009, Gulf Airlines, which was making a loss, stated it would reduce the number of new aircraft on order. If it did this, which of its costs would be directly affected? A fixed costs B marginal costs C opportunity costs D variable costs
Mark scheme: A
Q15 · The diagram shows the costs of a firm
15 The diagram shows the costs of a firm. 60 50 40 cost 30 ($ 000s) 20 10 0 100 output What is the firm's total variable cost at an output of 100 units? A $100 B $500 C $10 000 D $50 000
Mark scheme: D
Q16 · A government lowers the rate of interest
16 A government lowers the rate of interest. Who is most likely to be disadvantaged by this policy? A house buyers B manufacturers C retailers D savers
Mark scheme: D
Q17 · Which is a supply-side policy that would increase output in the long-run?
17 Which is a supply-side policy that would increase output in the long-run? A an increase in benefit payments B an increase in places at training colleges C an increase in the rate of income tax D an increase in the rate of tax employers pay
Mark scheme: B
Question 18
18 Russia exports wheat. In 2010, a bad harvest led the Russian government to prevent the export of wheat, to ensure enough supplies were kept for domestic use. What was the most likely outcome of the government’s action? A prices were fixed by the wheat producers B the amount produced was determined by the government C the price of wheat abroad fell D there was a redistribution of domestic production
Mark scheme: D
Q19 · The government reduces the rate of income tax and increases the rate of tax on producers
19 The government reduces the rate of income tax and increases the rate of tax on producers. From the initial equilibrium point X, which letter indicates the new equilibrium point in the market? S2 B A S1 price S3 X C D D2 D1 D3 O quantity
Mark scheme: B
Q20 · What is most likely to cause economic growth?
20 What is most likely to cause economic growth? A a better educated workforce B a reduction in the right to own property C decreased wages D higher taxation
Mark scheme: A
Q21 · A worker earns $250 each week, which leaves a disposable income of $175
21 A worker earns $250 each week, which leaves a disposable income of $175. What will affect the real value of the worker’s $250 earned income? A a change in government spending B a change in interest rates C a change in the price level D a change in the tax rate
Mark scheme: C
Q22 · The table shows the unemployment rate in three developed economies in June 2013
22 The table shows the unemployment rate in three developed economies in June 2013. % United States 7.6 Sweden 8.2 France 10.9 What is the main cause of high rates of unemployment in developed economies in periods of recession? A decreases in total demand B movement of labour between countries C reduced levels of technological change D regional inequalities of wealth
Mark scheme: A
Q23 · From 2012 to 2013, European economies experienced weak economic growth
23 From 2012 to 2013, European economies experienced weak economic growth. Based on the information on GDP, industrial production and unemployment in the table, which economy performed worst? Percentage change 2012-2013 industrial GDP unemployment production A UK +1.0 –2.3 –0.1 B Germany +0.3 –1.1 0.0 C Italy –1.8 –4.2 +1.5 D Spain –1.7 –1.3 +1.3
Mark scheme: C
Q24 · What is not a reason why the average size of families is likely to be greater in…
24 What is not a reason why the average size of families is likely to be greater in developing countries than in developed countries? A Children offer the prospect of security in old age. B Government child care support is widely available. C Means of birth control are less available and more expensive. D Women are less likely to be part of the workforce.
Mark scheme: B
Q25 · The table shows the proportion of GDP produced by each sector of production in three…
25 The table shows the proportion of GDP produced by each sector of production in three fictitious countries. Farland Highland Lowland (% of GDP) (% of GDP) (% of GDP) primary sector 30 10 35 secondary sector 20 60 25 tertiary sector 50 30 40 What can be concluded from the table? A Farland is the least developed economy. B Highland is the most developed economy. C It is uncertain which is the most developed economy. D Lowland is the least developed economy.
Mark scheme: C
More questions on Differences in economic development between countries
Q26 · In rural areas in developing countries, farmers grow food for their own consumption
26 In rural areas in developing countries, farmers grow food for their own consumption. Why might this mean that the GDP is a weak measure of the standard of living in those countries? A The food grown is not exported. B The GDP does not include agricultural production. C The GDP only refers to the public sector. D The value of the food is unknown.
Mark scheme: D
Q27 · The charts show the population structure of a country in 1960 and 2010
27 The charts show the population structure of a country in 1960 and 2010. age age 85+ 85+ 80-84 80-84 75-79 75-79 male 70-74 female male 70-74 female 65-69 65-69 60-64 60-64 55-59 55-59 50-54 50-54 45-49 45-49 40-44 40-44 35-39 35-39 30-34 30-34 25-29 25-29 20-24 20-24 15-19 15-19 10-14 10-14 5-9 5-9 0-4 0-4 3 2 1 0 0 1 2 3 3 2 1 0 0 1 2 3 millions millions 1960 2010 During this period, how did birth and death rates change? birth rates death rates A fell fell B fell no change C rose fell D rose no change
Mark scheme: A
Q28 · What is an advantage of international specialisation?
28 What is an advantage of international specialisation? A choice is limited B countries become overdependent on each other C resources are used more efficiently D transport costs are decreased
Mark scheme: C
Q29 · Skin creams preventing sunburn made in the European Union (EU) are more effective than…
29 Skin creams preventing sunburn made in the European Union (EU) are more effective than those made in the United States (US). US tourists stock up on the creams when visiting Europe. Such creams are banned from production in the US because of the chemicals in them. In 2013, negotiations began to remove this ban in order to allow production in the US. How is this freer trade likely to affect manufacturers of skin creams in the US and the EU? manufacturers manufacturers in the US in the EU A gain gain B gain lose C lose gain D lose lose
Mark scheme: B
Q30 · The table shows the trade in goods balance and the current account balance of the balance…
30 The table shows the trade in goods balance and the current account balance of the balance of payments for four countries during a year. Which country had the largest surplus on its trade in services, assuming no other transfers or income flows? trade in goods current account country balance balance ($ billion) ($ billion) A Hong Kong 6.2 6.2 B Indonesia 4.4 4.3 C Mexico 7.8 7.6 D Singapore 5.3 5.4
Mark scheme: D
What was in this paper
The subtopics covered by these 30 questions, and how many questions each got. Open one in a new tab to see every Cambridge question on it.
2Globalisation, free trade and protection2Population2Price changes2Current account of balance of payments1Differences in economic development between countries1Economic growth1Employment and unemployment1Firms1Firms and production1Fiscal policy1Inflation and deflation1International specialisation1Living standards1Market failure1Mixed economic system1Monetary policy1Money and banking1Opportunity cost1Production possibility curve (PPC) diagrams1Supply-side policy1The factors of production1The macroeconomic aims of government1The nature of the economic problem1Trade unions1Workers1What you needed in this session
Cambridge’s own grade thresholds for 2015 May/June, Paper 1 · Variant 1. A higher threshold means an easier paper — the bar moves with how the cohort did.