Cambridge IGCSE Economics 0455 — 2017 Oct/Nov Paper 1 · Variant 1
0455/11/O/N/17 · 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 scheme3 pages
Answers below. Sit the paper first if you are practising.
Questions as text
Q1 · An oil company announced in 2015 that it was starting its drilling operations for oil…
1 An oil company announced in 2015 that it was starting its drilling operations for oil deposits in the Arctic Ocean. What will be the effect of this? A to increase the supply of raw materials B to reduce the level of technology available C to solve the economic problem D to worsen resource allocation
Mark scheme: A
Q2 · A self-employed fortune teller earns a living by reading the palms of people’s hands
2 A self-employed fortune teller earns a living by reading the palms of people’s hands. Which factors of production are essential to this activity? A capital and enterprise B enterprise and labour C labour and land D land and capital
Mark scheme: B
Q3 · A country is operating at point X on its production possibility curve (PPC)
3 A country is operating at point X on its production possibility curve (PPC). A drought significantly reduces agricultural output. Which point represents the new position? manufacturing A output B X C D O agricultural output
Mark scheme: C
More questions on Production possibility curve (PPC) diagrams
Q4 · A government needs to decide how much to fine firms for causing the external costs of air…
4 A government needs to decide how much to fine firms for causing the external costs of air pollution in industrial areas. Which external cost would be the most difficult to measure in monetary terms? A the discomfort associated with breathing B the expenditure on additional healthcare C the loss of earnings due to illness D the medical research into respiratory disease
Mark scheme: A
Q5 · What is an example of market failure?
5 What is an example of market failure? A city centre congestion B low economic growth C rising prices D trade deficits
Mark scheme: A
Q6 · The table illustrates the demand and supply for coffee in a market in Africa
6 The table illustrates the demand and supply for coffee in a market in Africa. price per kg quantity demanded quantity supplied ($) (kg) (kg) 10 50 10 20 40 20 30 30 30 40 20 40 50 10 50 When the price rises from $20 to $30 per kg, what is the price elasticity of demand for coffee? A 0.2 B 0.5 C 2.0 D 5.0
Mark scheme: B
Q7 · Between 2005 and 2015 the number of late-night music clubs in the UK fell from 3144 to…
7 Between 2005 and 2015 the number of late-night music clubs in the UK fell from 3144 to 1733. The causes were said to be the increase in the cost to clubs of planning regulations and the increase in alternative ways of meeting people on social media. How would the effect of these causes be shown on a demand and supply diagram for entrance to late-night music clubs? increase in planning regulations dating websites A movement down shift of the supply curve demand curve to left B movement up movement up the supply curve the demand curve C shift of shift of supply curve to left demand curve to left D shift of shift of supply curve to right demand curve to right
Mark scheme: C
Q8 · A job offers employees piecework, commission, paid holidays and a company pension
8 A job offers employees piecework, commission, paid holidays and a company pension. Which are non-wage factors? A commission and company pension B company pension and paid holidays C paid holidays and piecework D piecework and commission
Mark scheme: B
Q9 · When will a trade union be most likely to succeed in achieving the aims of its members?
9 When will a trade union be most likely to succeed in achieving the aims of its members? A when firms are trying to cut costs of production B when the rate of unemployment in the country is high C when trade union membership in the industry is compulsory D when workers are unskilled
Mark scheme: C
Q10 · The typical pattern of income over a person’s whole lifetime is shown by which diagram?
10 The typical pattern of income over a person’s whole lifetime is shown by which diagram? A B C D income income income income O O O O lifetime lifetime lifetime lifetime
Mark scheme: C
Q11 · When choosing an occupation people often consider things other than the wage-rate
11 When choosing an occupation people often consider things other than the wage-rate. What would not be a good match for the type of work that is desired? desired aspect occupation A detailed work; career structure lawyer B outdoor lifestyle; regular hours farmer C part-time hours; work with people supermarket assistant D technical knowledge; responsibility telephone engineer
Mark scheme: B
Q12 · Which is an internal diseconomy of scale?
12 Which is an internal diseconomy of scale? A a lack of communication in a firm B a reduction of cost by buying in bulk C a shortage of skilled labour in an area D traffic congestion in a particular area
Mark scheme: A
Q13 · What is not likely in an industry with many small firms?
13 What is not likely in an industry with many small firms? A high capital costs B high level of competition C low barriers to entry D low research expenditure
Mark scheme: A
Q14 · A major computer company announced that its profits had fallen below the level predicted
14 A major computer company announced that its profits had fallen below the level predicted. What might have caused this? A increased advertising costs that greatly improved sales B low prices that made the company’s product competitive C new technology that reduced costs D reduced sales and low prices
Mark scheme: D
Q15 · The diagram shows the fixed costs, variable costs and total costs of a firm
15 The diagram shows the fixed costs, variable costs and total costs of a firm. T costs S R O Q output At output Q, which distance represents the firm’s variable cost? A QR B QT C RT D ST
Mark scheme: C
Q16 · What, when increased, will help a government to reduce the rate of inflation?
16 What, when increased, will help a government to reduce the rate of inflation? A budget deficit B consumer spending C income tax D pensions
Mark scheme: C
Q17 · An economy has a deficit on its balance of trade in manufactured goods
17 An economy has a deficit on its balance of trade in manufactured goods. Which government policy will reduce this deficit? A a decrease in subsidies paid to local manufacturers B an increase in interest rates C an increase in sales tax on locally manufactured goods D an introduction of import duties on manufactured goods
Mark scheme: D
Q18 · The graph shows the percentage of income paid in taxation
18 The graph shows the percentage of income paid in taxation. Which line represents a proportional tax? A % income B paid in taxation C D O income
Mark scheme: D
Q19 · What is most likely to decrease when employment increases?
19 What is most likely to decrease when employment increases? A economic growth B government welfare payments C the price level D the standard of living
Mark scheme: B
Q20 · Why is the Human Development Index (HDI) often considered to be better than Gross…
20 Why is the Human Development Index (HDI) often considered to be better than Gross Domestic Product (GDP) per head as a measure of living standards? A GDP per head excludes economic growth. B GDP per head ignores population growth. C HDI includes more than the production of goods and services. D HDI is calculated by the national government.
Mark scheme: C
Q21 · An economy is predicted to grow at a rate of 3% during the next year
21 An economy is predicted to grow at a rate of 3% during the next year. What is most likely to cause this growth? A an increase in expenditure B an increase in interest rates C an increase in sales (goods and services) tax D an increase in the government’s budget surplus
Mark scheme: A
Q22 · The diagrams show percentage employment in different sectors in two countries
22 The diagrams show percentage employment in different sectors in two countries. country X country Y percentage 70 percentage 70 employed employed 60 60 50 50 40 40 30 30 20 20 10 10 0 0 primary secondary services primary secondary services Which statement is correct when comparing country X and country Y? A Country X employs more workers in secondary industry than country Y. B Country X produces more primary output than country Y. C Country Y is more developed than country X. D Country Y produces more secondary output than country X.
Mark scheme: C
More questions on Differences in economic development between countries
Q23 · Which policy aims to maintain low inflation over a period of time?
23 Which policy aims to maintain low inflation over a period of time? A imposing a minimum wage to be paid to workers B reducing interest rates to encourage borrowing C restricting the supply of money through the central bank D writing off the debts of low-income countries
Mark scheme: C
Q24 · What most accurately measures the international purchasing power of a currency?
24 What most accurately measures the international purchasing power of a currency? A the balance of payments B the exchange rate C the gross domestic product D the rate of inflation
Mark scheme: B
Q25 · The charts show the population structure of a country in 1960 and 2015
25 The charts show the population structure of a country in 1960 and 2015. 1960 2015 male age female male age female 85+ 85+ 80 – 84 80 – 84 75 – 79 75 – 79 70 – 74 70 – 74 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 What decreased between 1960 and 2015? A average age B number of people below 15 C number of people over 60 D total population
Mark scheme: B
Q26 · The table gives information about four countries
26 The table gives information about four countries. Which country is likely to be most developed? GDP per head % of labour force life expectancy (US$) in agriculture A 52 450 50 B 54 490 40 C 60 550 15 D 60 500 25
Mark scheme: C
More questions on Differences in economic development between countries
Q27 · What is a benefit of tariffs?
27 What is a benefit of tariffs? A increased choice B increased government revenue C more competition D more trade
Mark scheme: B
Q28 · What is a country said to have if the value of its exported goods exceeds the value of…
28 What is a country said to have if the value of its exported goods exceeds the value of its imported goods? A a surplus on its balance of payments B a surplus on its balance of trade C a surplus on its capital account D a surplus on its current account
Mark scheme: B
Q29 · An Argentine product initially sells in the US for $50 when the exchange rate between the…
29 An Argentine product initially sells in the US for $50 when the exchange rate between the two countries is 5 pesos to 1 dollar The exchange rate changes to 10 pesos to 1 dollar and the price of the product remains unchanged in Argentina. What will be the new price of the product in the US? A $5 B $25 C $100 D $500
Mark scheme: B
Q30 · The UK wants to increase exports to the US
30 The UK wants to increase exports to the US. What action will achieve this? A borrowing US dollars from international banks B devaluing UK pounds against the US dollar C placing a quota on imports from the US D selling US dollars to buy UK pounds
Mark scheme: B
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.
3Foreign exchange rates3Workers3Differences in economic development between countries2Globalisation, free trade and protection2Market failure2Monetary policy2The factors of production2Current account of balance of payments1Economic growth1Employment and unemployment1Fiscal policy1Living standards1Market structure1Population1Price changes1Price elasticity of demand (PED)1Production possibility curve (PPC) diagrams1Trade unions1What you needed in this session
Cambridge’s own grade thresholds for 2017 Oct/Nov, Paper 1 · Variant 1. A higher threshold means an easier paper — the bar moves with how the cohort did.