Cambridge IGCSE Economics 0455 — 2015 May/June Paper 1 · Variant 3
0455/13/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 · Each of the factors of production earns an income
1 Each of the factors of production earns an income. What are the incomes for capital and enterprise? capital enterprise A interest profit B interest wages C profit interest D profit rent
Mark scheme: A
Q2 · Malaysia is a mixed economy
2 Malaysia is a mixed economy. Which statement about a mixed economy is necessarily correct? A private industry will provide most of the manufactured goods B the government will provide public goods and may provide merit goods C the primary sector will employ most workers D the transport network will be heavily subsidised
Mark scheme: B
Q3 · Water is a scarce resource in Singapore because the island’s small geographical area…
3 Water is a scarce resource in Singapore because the island’s small geographical area means there is little land on which to collect water for its 4.8 million people. Which method would be least successful in tackling its water scarcity? A exempting large families from paying water taxes B importing water from neighbouring countries C introducing a water tax that rises as consumption rises D redirecting funds from education to schemes to purify rainwater
Mark scheme: A
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 · In 2011, China’s steel mills bought more coal in order to increase their output
5 In 2011, China’s steel mills bought more coal in order to increase their output. China is the world’s largest consumer of coal. How would this change be shown on a demand and supply diagram for coal? A a fall in price with a movement along the supply curve B a movement along the demand curve with a rise in price C a rise in price with a shift in the supply curve to the left D a shift in the demand curve to the right with a rise in price
Mark scheme: D
Q6 · In recent years, the demand for cars in Indonesia has become more price inelastic while…
6 In recent years, the demand for cars in Indonesia has become more price inelastic while the supply of cars has become more price elastic. Which combination of events could have caused these changes? quality of public time taken to transport produce a car A decreased decreased B decreased increased C increased decreased D increased increased
Mark scheme: A
Q7 · The diagram shows the market for fresh fish in the Caribbean with initial equilibrium…
7 The diagram shows the market for fresh fish in the Caribbean with initial 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 · What is not a function of a trade union?
9 What is not a function of a trade union? A to arrange promotion for its members B to discuss members’ working conditions C to negotiate members’ wages D to represent members in disputes
Mark scheme: A
Q10 · When elderly people retire from work, they may receive a pension income that is lower…
10 When elderly people retire from work, they may receive a pension income that is lower than their previous income. How is the proportion of their income spent on healthcare and leisure likely to change? healthcare leisure A decrease decrease B decrease increase C increase decrease D increase increase
Mark scheme: C
Q11 · A bus company wishes to recruit a qualified senior manager to be responsible for…
11 A bus company wishes to recruit a qualified senior manager to be responsible for coordinating bus timetables and managing staff. Some work will be required at night as the company also operates bus services at night. It is offering a good salary. Which applicant would be most likely to be offered the position? A a person employed as a manager of a small taxi company B a person employed as a supervisor in another bus company C a recently qualified business graduate D a trade union representative from another bus company with extensive family commitments
Mark scheme: B
Q12 · What is not usually associated with the existence of a monopoly?
12 What is not usually associated with the existence of a monopoly? A barriers to entry B perfect knowledge C profit maximisation D small firms
Mark scheme: D
Q13 · A group of farmers form a partnership
13 A group of farmers form a partnership. They buy more machinery which they share in the production of cereals. What is a benefit of using more machinery? A it eliminates the need to train labour B it encourages more labour-intensive methods C it increases the productivity of each farmer D it reduces total capital costs of production
Mark scheme: C
Q14 · Large-scale organisations can suffer from problems of coordination between departments…
14 Large-scale organisations can suffer from problems of coordination between departments which cause diseconomies of scale in the long-run. What indicates that diseconomies of scale have set in? A average fixed costs begin to decrease B average variable costs begin to decrease C rate of growth of output begins to decrease D total revenue begins to decrease
Mark scheme: C
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 · Which policy combination will have the greatest impact on increasing the level of total…
16 Which policy combination will have the greatest impact on increasing the level of total spending in the economy? government taxation spending A decreased decreased B decreased increased C increased decreased D increased increased
Mark scheme: B
Q17 · A toy company bought a $750 000 batch of raw plastic from a local firm and moulded it…
17 A toy company bought a $750 000 batch of raw plastic from a local firm and moulded it into toys. The total revenue from the toys was $1 000 000. The government demanded that the company pay tax on this action. What is the most likely tax that the company has to pay? A capital gains tax B goods and services (value added) tax C import duty D income tax
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 table shows the harmful carbon dioxide emissions for a country in selected years in…
19 The table shows the harmful carbon dioxide emissions for a country in selected years in millions of tonnes. 2000 2010 manufacturing 204 88 transport 72 135 total including all other sources 685 543 What would be likely to have the greatest effect on reducing carbon dioxide emissions? A introducing incentives to encourage manufacturers to reduce their emissions B providing grants to fit solar panels to manufacturing premises C raising taxes on petroleum and diesel fuel D subsidising car manufacturers
Mark scheme: C
Q20 · How is economic growth measured?
20 How is economic growth measured? A by an increase in consumer demand B by an increase in literacy C by an increase in output D by an increase in wages
Mark scheme: C
Q21 · Domestic consumption in an economy fell
21 Domestic consumption in an economy fell. What might have reduced the impact of that fall on the economy? A exports also declined B imports also declined C savings also increased D taxes also increased
Mark scheme: B
Q22 · In 2014, farmers’ crops were destroyed by two months of bad weather
22 In 2014, farmers’ crops were destroyed by two months of bad weather. As a result, in that year, they did not employ as many people at harvest time. What type of unemployment would this cause? A cyclical B frictional C seasonal D structural
Mark scheme: C
Q23 · The following information was published by an economy’s central bank
23 The following information was published by an economy’s central bank. In which case was real GDP growth highest? rate of nominal rate of GDP growth (%) inflation (%) A 2.0 1.0 B 7.0 5.0 C 9.0 13.0 D 10.0 11.0
Mark scheme: B
Q24 · The Human Development Index can be used to measure human development in countries
24 The Human Development Index can be used to measure human development in countries. Which measure would not be part of its calculation? A inequality of incomes B life expectancy C standards of living D years of schooling
Mark scheme: A
More questions on Differences in economic development between countries
Q25 · The ratio of males to females in Russia is 90 to 100
25 The ratio of males to females in Russia is 90 to 100. What could explain this imbalance? A more women than men emigrate from Russia B ten male babies are born for every nine female babies C the infant mortality rate is higher among girls than boys D women have a longer life expectancy than men in Russia
Mark scheme: D
Q26 · The table gives the percentage employment in the primary, secondary and service sectors…
26 The table gives the percentage employment in the primary, secondary and service sectors in four countries. Which country is most likely to be a developed country? primary secondary service sector sector sector A 10 35 55 B 20 60 20 C 35 35 30 D 40 40 20
Mark scheme: A
More questions on Differences in economic development between countries
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 · Which combination of changes would raise the price of the Pakistani rupee on the foreign…
29 Which combination of changes would raise the price of the Pakistani rupee on the foreign exchange market? demand for Pakistan’s demand Pakistan’s exports for imports A decrease decrease B decrease increase C increase decrease D increase increase
Mark scheme: C
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.
3Differences in economic development between countries2Firms’ costs, revenue and objectives2Fiscal policy2Market failure2Population2Current account of balance of payments1Demand1Employment and unemployment1Firms and production1Foreign exchange rates1Globalisation, free trade and protection1International specialisation1Living standards1Market structure1Mixed economic system1Opportunity cost1Price determination1Price elasticity of demand (PED)1The factors of production1The nature of the economic problem1Trade unions1Workers1What you needed in this session
Cambridge’s own grade thresholds for 2015 May/June, Paper 1 · Variant 3. A higher threshold means an easier paper — the bar moves with how the cohort did.