Economic growth — Paper 1 · IGCSE Economics (9-1) 0987

21 What may directly cause economic growth? A higher imports B higher levels of resources C higher taxation D higher unemployment

1 marks

Answer: B

This question in 0987/11 May/June 2020

21 The table shows figures for the real GDP of a country. quarter 1 quarter 2 quarter 3 quarter 4 ($bn) ($bn) ($bn) ($bn) 100 101 99 98 A quarter is three months. During which quarters was the country experiencing a recession? A quarters 1 and 2 B quarters 2 and 3 C quarters 3 and 4 D the entire period

1 marks

Answer: C

This question in 0987/12 May/June 2020

21 Economic growth can be defined as A a reduction in a country’s rate of inflation. B an increase in a country’s exports. C an increase in a country’s population. D an increase in a country’s productive capacity.

1 marks

Answer: D

This question in 0987/11 May/June 2021

21 Economic growth can be defined as A a reduction in a country’s rate of inflation. B an increase in a country’s exports. C an increase in a country’s population. D an increase in a country’s productive capacity.

1 marks

Answer: D

This question in 0987/12 May/June 2021

18 What is the consequence of economic growth for individuals and for the economy? individuals the economy A increase in absolute poverty increase in inflation B increase in average incomes increase in government tax revenue C increase in the variety of goods and services reduction in exports D increase in unemployment reduction in the standard of living

1 marks

Answer: B

This question in 0987/12 Oct/Nov 2021

20 What is a likely cause of economic growth? A decreased employment B decreased investment C decreased productivity D decreased taxation

1 marks

Answer: D

This question in 0987/11 May/June 2022

23 Why would standards of living fall when there is a recession? A The government would increase taxes to combat the recession. B The purchasing power of households would fall. C The value of the domestic currency would increase. D There would be a rise in the level of immigration.

1 marks

Answer: B

This question in 0987/11 May/June 2022

20 What is identified as economic growth? A a fall in labour productivity B an increase in the productive capacity of the economy C an increase in the Consumer Prices Index (CPI) D the economy enters a period of recession

1 marks

Answer: B

This question in 0987/12 May/June 2022

19 The diagram shows a country’s economic growth rate over a 5-year period. 6 economic 5 growth rate % 4 3 2 1 0 year 1 year 2 year 3 year 4 year 5 –1 –2 What can be concluded from the diagram? A Output fell throughout the period. B Output was at its highest in year 1. C Output was at its highest in year 5. D Output was at its lowest in year 4.

1 marks

Answer: C

This question in 0987/12 Oct/Nov 2022

20 An individual decides to employ a professional decorator rather than buying the materials and decorating her house herself. Why would this decision cause GDP to rise? A The activity would be recorded as income for the decorator. B The individual would have more leisure time. C The professional decorator can purchase materials at a discount. D The professional decorator would work less efficiently than the individual.

1 marks

Answer: A

This question in 0987/12 Oct/Nov 2022

23 The table shows changes in economic growth and inflation. Which changes are likely to be the result of rising unemployment? economic inflation growth A falling falling B falling rising C rising falling D rising rising

1 marks

Answer: A

This question in 0987/12 Oct/Nov 2022

2 A country’s production possibility curve (PPC) moves from PPC1 to PPC2. consumer goods PPC1 PPC2 O capital goods What could cause this movement in the PPC? better higher lower education investment unemployment A false false true B false true false C true false true D true true false

1 marks

Answer: D

This question in 0987/12 May/June 2023

4 What is an example of a macroeconomic indicator? A agricultural prices B average earnings in the secondary sector C real Gross Domestic Product (real GDP) D total costs of German pharmaceutical firms

1 marks

Answer: C

This question in 0987/12 May/June 2023

20 The government of country Z announces an increase in spending on work-place training. What is the effect of this supply-side policy likely to be? A a decrease in country Z’s employment rate B a decrease in country Z’s exchange rate C an increase in country Z’s economic growth rate D an increase in country Z’s interest rate

1 marks

Answer: C

This question in 0987/12 May/June 2023

21 The table shows real GDP in US$ billion for a country over a three-year period. real GDP year US$ billion 1 205 2 215 3 219 What does the GDP data indicate for the country between year 1 and year 3? A a reduction in the rate of inflation B an increase in the rate of economic growth C the existence of economic growth D the existence of economic growth per capita

1 marks

Answer: C

This question in 0987/12 May/June 2023

23 The diagrams show Italy’s unemployment rate and GDP per head. Italy’s unemployment rate Italy’s GDP per head 13 39 000 % $ 38 000 11 37 000 9 36 000 35 000 7 34 000 5 33 000 2000 2005 2010 2015 2000 2005 2010 2015 year year When do Italy’s unemployment rate and GDP per head rise at the same time? A 2000–2001 B 2007–2008 C 2009–2010 D 2014–2015

1 marks

Answer: B

This question in 0987/12 May/June 2023

21 The table shows the real GDP per head for a country in 2021 and 2022. 2021 2022 $20000 $21000 What is most likely to have changed between 2021 and 2022? A Incomes were distributed more evenly. B There was more activity in the informal economy. C The living standards of some people improved. D The rate of inflation increased.

1 marks

Answer: C

This question in 0987/12 Oct/Nov 2023

21 Which change is most likely to cause faster economic growth in the short run? A an increase in net emigration B an increase in the birth rate C an increase in the death rate D an increase in the retirement age

1 marks

Answer: D

This question in 0987/12 May/June 2024

17 What will cause real GDP to rise in a country? A nominal GDP rising at a faster rate than employment B nominal GDP rising faster than inflation C nominal GDP rising faster than the population D nominal GDP rising

1 marks

Answer: B

This question in 0987/12 Oct/Nov 2024

20 What is the definition of economic growth? A It is an increase in the general level of prices over time. B It is an increase in the level of a nation's output over time. C It is an increase in the level of total demand over time. D It is an increase in wages, interest, profits and rent over time.

1 marks

Answer: B

This question in 0987/12 Oct/Nov 2024

22 The table shows government expenditure and revenue in selected years. government tax year expenditure revenue $bn $bn 1 500 500 2 600 400 3 700 300 What might explain the changes in the government’s budget over the period? A a fall in the dependency ratio B a fall in the exchange rate C an increase in cyclical unemployment D an increase in real GDP

1 marks

Answer: C

This question in 0987/12 Oct/Nov 2024

4 In 2020, to prevent the spread of a pandemic, many governments temporarily closed restaurants and cafés. What would be a macroeconomic impact of such a policy? A Demand for food to be consumed at home would rise. B Gross Domestic Product (GDP) would fall. C The profits from restaurants and cafés would fall. D Staff working in restaurants and cafés would lose income.

1 marks

Answer: B

This question in 0987/11 May/June 2025

21 Which policy decision is most likely to cause economic growth? A an increase in corporation tax rates B an increase in interest rates C an increase in the amount workers can earn before paying income tax D an increase in the government's regulations for starting a new business

1 marks

Answer: C

This question in 0987/11 May/June 2025

17 Many central banks around the world decreased interest rates during a recession caused by a pandemic. What was the most likely macroeconomic aim of this policy? A economic growth B increase in the current account surplus C low inflation D redistribution of income

1 marks

Answer: A

This question in 0987/12 May/June 2025

22 In one particular year, South Sudan’s population growth was 1.3% while its GDP growth was 2%. What is the most likely consequence of this? A GDP per capita will decrease B the rate of inflation will decrease C the standard of living will increase D unemployment will increase

1 marks

Answer: C

This question in 0987/12 Oct/Nov 2025