Economics revision questions

The intersection point would also mean that two indifference curves have the same level of utility which is also not true.

economics multiple choice questions and answers pdf

Convex to the origin: Indifference curves are convex to the origin denoting diminishing marginal rate of substitution of one commodity for another since commodities are close but not perfect substitutes such that as more of one commodity is consumed it becomes increasingly difficult to give up more units.

Minimum price control price floors : Institutionalized excess supply over demand for a commodity.

Economics revision questions

Petrol from Caltex and petrol from Total. Economics Specific Revision For a range of different online resources, lecture notes, worksheets, quizzes see the economics network site. The indifference curves for complementary goods are L-shaped right-angled since marginal rate of substitution is equal to zero, that is, marginal rate of substitution is equal to zero implying that there is no possibility of substitution. Waste of resources by the government through policing efforts in trying to ensure adherence to statutory prices. This is the source of regression of the demand curve. Make sure you have plenty of time to get there. Assume that we measure money income on the vertical axis and leisure time on the horizontal axis. These will give you a great idea of what to expect and, if you have past papers from a few years, you may be able to spot some recurring question topics. Nottingham University has a good revision guidebook. It also means, as is so often the case in economics, subjects overlap. Make sure you explain your diagrams and graphs. Everyone learns in different ways. In this case, the goods being consumed are mutually exclusive in consumption such that either of them can be exclusively consumed without the other while the consumer derives the same level of satisfaction. Panic cramming should be avoided.

This can give you a greater, more rounded idea of the subject. Use past papers when you revise. However, for giffen goods the negative income effect is overwhelming on the positive substitution effect such that the total price effect is negative. Give yourself time to read the question. Loss of foreign exchange arising from importation of essential commodities whose domestic supply is insufficient.

Answer ii Explain any four uses of indifference curve analysis.

a level economics resources

For example, eight hours of straight revision, with no breaks is not going to be as beneficial as four two-hour periods, so allow for breaks. Assume that the government gives food coupons to the pensioner which allow him to buy food at half the market price.

The individual can either use all the 0Z houfor leisure, in which case he earns zero income, or he can choose to work all the 0Z hours and earn a maximum money income 0M given the current market wage rate w or he can use part of the 0Z hours for leisure e.

Igcse economics revision questions pdf

Loss of foreign exchange arising from importation of essential commodities whose domestic supply is insufficient. Explain their relevance within the answer. Timing: if you aim to achieve, say, five hours of revision in one day, start early. By having a little bit of flexibility you allow for any illness or an unexpected, unavoidable trip out. Answer ii Explain any four uses of indifference curve analysis. This is the source of regression of the demand curve. In fact if the government were to give to the pensioner the cost of the subsidy in the form of supplementary income, the pensioner would attain a higher level of satisfaction an indifference curve above I2. For example, assume that the government considers either the adoption of a food subsidization policy for pensioners or granting a supplementary income to them. For example, if there is a surplus food production the government may adopt the more costly subsidization policy which apart from increasing the welfare of the consumer, also benefits the producers by reducing or even eliminating the surplus. What you may have learnt in one module is equally applicable in another. The effects of the food subsidy. Assume that we measure money income on the vertical axis and leisure time on the horizontal axis.

This curve shows different combinations of income, earned by working, and leisure time. Use of indifference comes also allows for the classification of goods into normal, inferior or giffen.

Hard economics questions

This is the source of regression of the demand curve. In this case, the goods being consumed are mutually exclusive in consumption such that either of them can be exclusively consumed without the other while the consumer derives the same level of satisfaction. Which one of these alternative policies the government will adopt depends not only on the above considerations, but also on the other goals of the government and the indirect effects of each policy. Use past papers when you revise. Marginal rate of substitution is the amount of one commodity that the consumer is just willing and able to give up for an additional unit of another commodity while deriving the same level of satisfaction. Work on your weaknesses. For example, if there is a surplus food production the government may adopt the more costly subsidization policy which apart from increasing the welfare of the consumer, also benefits the producers by reducing or even eliminating the surplus. For example, eight hours of straight revision, with no breaks is not going to be as beneficial as four two-hour periods, so allow for breaks. Economics Specific Revision For a range of different online resources, lecture notes, worksheets, quizzes see the economics network site. Intersection implies that different levels of satisfaction can be derived on the same indifference curve which is not in accordance with the definition of indifference curves. The goal of the government is to make it possible for the pensioner to move to the higher level of welfare satisfaction denoted by the indifference curve I2 Which of these measures costs less to the government and hence to the tax payer? It may also require the setting up of costly storage facilities in the name of buffer stocks so that goods are released to the public at subsidized prices in the event of a shortage. We first derive the income-leisure curve of an individual consumer.
Rated 6/10 based on 8 review
Download
GCSE Economics