Cambridge IGCSE Economics 0455 — 2015 Oct/Nov Paper 1 · Variant 2
0455/12/O/N/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 · In a rural community of Southern Africa, women were responsible for planting and weeding…
1 In a rural community of Southern Africa, women were responsible for planting and weeding crops by hand, while men used to control production and receive profits. Which combination of factors of production was in operation? men women A capital land B enterprise labour C labour capital D land enterprise
Mark scheme: B
Q2 · The government of a prosperous country announced that it would offer free food to its…
2 The government of a prosperous country announced that it would offer free food to its citizens for a year. What would be the effect of this measure? A Agricultural resources would become unlimited. B Human wants would become finite. C More resources would be devoted to food production. D The basic economic problem would be solved.
Mark scheme: C
Q3 · The diagram shows a production possibility curve for an economy that can produce rice or…
3 The diagram shows a production possibility curve for an economy that can produce rice or electronic equipment. The economy is at point Q. A recession causes unemployment in the electronics industries. At which point will the economy be in the diagram? C B Q A D rice O electronic equipment
Mark scheme: A
More questions on Production possibility curve (PPC) diagrams
Q4 · A person works at home making table cloths
4 A person works at home making table cloths. He works for 6 hours each day and makes 15 table cloths an hour. He sells them for $10 each. He then decides to work for only 4 hours each day. What can be concluded from the above information? A The lost profit would be $300. B The lost revenue would be $60. C The daily opportunity cost would be 30 table cloths. D The daily opportunity cost would be $50.
Mark scheme: C
Q5 · What is meant by an equilibrium price?
5 What is meant by an equilibrium price? A a government price that ensures fairness for all B a price that has no pressure to rise or fall C a price that maximises the profits of the producers D a price that maximises the satisfaction of the consumers
Mark scheme: B
Q6 · In August 2013, a lengthy strike in north-east India, where the finest and most expensive…
6 In August 2013, a lengthy strike in north-east India, where the finest and most expensive Darjeeling tea is grown, shut down the tea industry at harvest time. What is the likely outcome of such a situation on a demand and supply diagram for Darjeeling tea? A The price will rise because demand will switch to other teas. B The price will rise because the strike will cause a movement down the supply curve. C The price will rise because the supply curve will move to the left. D The price will rise because there will be a fall in demand for the remaining Darjeeling tea.
Mark scheme: C
Q7 · Air travel and rail travel are substitute forms of transport
7 Air travel and rail travel are substitute forms of transport. The diagram shows the effect of new technology on the market for air travel. S1 S2 price per P1 ticket P2 D O Q1 Q2 quantity of airline tickets What would be the most likely effect on the market for rail transport? A a decrease in demand for rail transport B an increase in the price of rail tickets C an increase in supply of rail transport D an increase in the total income of rail companies
Mark scheme: A
Q8 · A developer built some large houses in a rural area which poorer people could not afford
8 A developer built some large houses in a rural area which poorer people could not afford. The houses destroyed an area of natural beauty. What type of market failure resulted from the development? A ignoring external cost B inequality of income C lack of information D price discrimination
Mark scheme: A
Q9 · How do high direct taxes affect spending and how do high interest rates affect saving by…
9 How do high direct taxes affect spending and how do high interest rates affect saving by wage- earners? spending saving A decrease decrease B decrease increase C increase decrease D increase increase
Mark scheme: B
Q10 · A national trade union wishes to increase the wages of its members without reducing the…
10 A national trade union wishes to increase the wages of its members without reducing the numbers employed. Which factor would help the union to do this? A The demand for the industry’s product is high. B The industry consists of a small number of well-organised employers. C The union workers have low-level skills. D The workers’ wages are the largest cost of the industry.
Mark scheme: A
Q11 · The wage rate of a worker is reduced
11 The wage rate of a worker is reduced. Which combination of characteristics of the job is most likely to cause the worker to stay in the job? additional unsocial job security bonuses hours A high high many B high high none C low low many D low low none
Mark scheme: B
Q12 · What characteristics are found in a monopoly?
12 What characteristics are found in a monopoly? A freedom of entry to the market and a single seller B freedom of entry to the market and many sellers C many buyers and a single seller D many buyers and many sellers
Mark scheme: C
Q13 · What must be falling if a firm is experiencing economies of scale?
13 What must be falling if a firm is experiencing economies of scale? A average costs B external costs C fixed costs D total costs
Mark scheme: A
Q14 · A company supplying water spent $470 million creating a network of pipes to distribute…
14 A company supplying water spent $470 million creating a network of pipes to distribute water more efficiently. It employed local workers and boosted the local economy. It also provided better facilities for the tourist industry. What cannot be concluded from the above? A The company increased its profits. B There was a decrease in regional unemployment. C There were fixed costs of $470 million. D There were positive externalities.
Mark scheme: A
Q15 · The table shows the information that managers of a company have from a week of business…
15 The table shows the information that managers of a company have from a week of business activity. number of employees 100 average wage $900 value of output $100 000 rent $10 000 raw materials $20 000 Assuming there are no other costs, what is the value of the fixed costs? A $300 B $10 000 C $20 000 D $30 000
Mark scheme: B
Q16 · What is most likely to be the responsibility of a government?
16 What is most likely to be the responsibility of a government? A the building of a food processing plant B the building of a housing estate C the building of a large shopping centre D the building of a major rail link
Mark scheme: D
Q17 · Which statement about the meaning of government economic aims is correct?
17 Which statement about the meaning of government economic aims is correct? A Economic growth means that a country’s real output must rise over time. B Full employment means that no one must be unemployed. C Price stability means that the price of all goods and services must remain unchanged. D Redistribution of income means that everyone must have equal incomes.
Mark scheme: A
Q18 · A government wishes to close the gap between the earnings of the rich and the poor
18 A government wishes to close the gap between the earnings of the rich and the poor. What should it do to achieve this aim? A increase progressive taxation B increase the rate of interest C increase the rate of sales tax D increase the supply of money
Mark scheme: A
Q19 · A government decided to increase its spending on building schools and hospitals
19 A government decided to increase its spending on building schools and hospitals. Which aim of government policy is most likely to be achieved by this increase? A a balance of payments surplus B a stronger exchange rate C economic growth D price stability
Mark scheme: C
Q20 · The forecast for Germany’s GDP growth in 2013 was 1.5%
20 The forecast for Germany’s GDP growth in 2013 was 1.5%. What might cause economic growth? A an increase in imports B an increase in interest rates C an increase in productivity D an increase in unemployment
Mark scheme: C
Q21 · The proportion of workers employed varies between different industries and between…
21 The proportion of workers employed varies between different industries and between developing and developed economies. Which combination in the table is likely to have the highest percentage of workers employed? developing developed A agriculture manufacturing B agriculture services C construction manufacturing D construction services
Mark scheme: B
More questions on Differences in economic development between countries
Q22 · In 2009, a country had an inflation rate of 2%
22 In 2009, a country had an inflation rate of 2%. The table shows the inflation rate in the following years. inflation rate year (%) 2010 2 2011 1 2012 0 2013 –1 In which year did deflation start? A 2010 B 2011 C 2012 D 2013
Mark scheme: D
Q23 · Which item does the Human Development Index (HDI) of a country include, in addition to…
23 Which item does the Human Development Index (HDI) of a country include, in addition to real GDP per head and life expectancy at birth? A expenditure on law and order B literacy rate among adults C number of doctors D retirement age
Mark scheme: B
Q24 · Why might real GDP per head not be a good indicator of the standard of living in…
24 Why might real GDP per head not be a good indicator of the standard of living in developing countries? A It does not account for inflation. B It does not account for population changes. C It does not include primary production. D It does not include unpaid work on farms.
Mark scheme: D
Q25 · The richest 60% of the population in a developed economy received an increase in income
25 The richest 60% of the population in a developed economy received an increase in income. Which row is correct as a result of this increase? absolute poverty relative poverty A increased increased B increased remained constant C remained constant increased D remained constant remained constant
Mark scheme: C
Q26 · According to the United Nations, the share of world population living in developing…
26 According to the United Nations, the share of world population living in developing countries will increase from 83% in 2003 to 88% in 2050. What is likely to be the major cause of this predicted change? A Climate change will lead to lower food output and starvation. B Improved education for girls will lead to a small decline in birth rates. C Increasing numbers of people will migrate to developed countries. D Modern medicine and sanitation will lead to a rapid decline in death rates.
Mark scheme: D
Q27 · The diagram shows China’s trade with Brazil for 1999 and 2003 in billions of dollars
27 The diagram shows China’s trade with Brazil for 1999 and 2003 in billions of dollars. 0 1 2 3 4 5 Exports 1999 2003 Imports With reference to the diagram, what happened to China’s trade balance with Brazil between 1999 and 2003? A It experienced a falling surplus. B It experienced a rising deficit. C It moved from deficit to surplus. D It moved from surplus to deficit.
Mark scheme: D
Q28 · A country imposes tariffs and quotas on imported goods
28 A country imposes tariffs and quotas on imported goods. What will citizens of that country experience? A higher prices B higher welfare C higher unemployment D wider consumer choice
Mark scheme: A
Q29 · What is most likely to encourage international specialisation?
29 What is most likely to encourage international specialisation? A similarities in climate in different countries B the ability to produce products more cheaply than other countries C the discovery of oil in a country that had no oil before D very high international transport costs
Mark scheme: B
Q30 · Turkey’s agricultural sector employs 48% of the country’s workforce, compared with 17% in…
30 Turkey’s agricultural sector employs 48% of the country’s workforce, compared with 17% in the United States (US) and 3.9% in France. What could be concluded from this? A France is likely to import more agricultural produce than the US. B The workers in France are not as productive as those in Turkey. C Total agricultural production is likely to be higher in Turkey than in the US. D Turkey is likely to be less developed than France.
Mark scheme: D
More questions on Differences in economic development between countries
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.
2Economic growth2Firms’ costs, revenue and objectives2Fiscal policy2Living standards2Market failure2Current account of balance of payments1Demand1Globalisation, free trade and protection1Inflation and deflation1International specialisation1Market structure1Opportunity cost1Population1Poverty1Price determination1Production possibility curve (PPC) diagrams1Supply1The factors of production1The macroeconomic aims of government1The nature of the economic problem1The role of government1Trade unions1Workers1What you needed in this session
Cambridge’s own grade thresholds for 2015 Oct/Nov, Paper 1 · Variant 2. A higher threshold means an easier paper — the bar moves with how the cohort did.