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2008 - Unit 1 - Paper 1

2008 - Unit 1 - Paper 1

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Published by: capeeconomics on May 31, 2011
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6.
-
7.
I
\
8.
9.
FORMTP2008178
MAYIJONE2008
TESTCODE221160IO
CARIBBEANEXAMINATIONSCOUNCILADVANCEDPROF1CIENCYEXAMINATIONECONOMlCS
Unitl-Paper01
90
minutes
0)4
JULY2008
(p.m.?)
READTHEFOLLOWINGDffiECTIONSCARE}'ULLY
Thistestconsistsof
4S
items.Youwillhave90minutestoanswerthem.
2.
In
additiontothistestbooklet,youshouldhaveananswersheet.
3_
Donotbeconcerned
that
theanswersheetprovidesspacesformore
answers
thant~ereareitemsinthistest.
4.
Each
iteminthistesthasfoursuggested
answerslettered
(A),(B),(C),(D).
Readeach
itemyouareabouttoanswer
and
decidewhichchoiceisbest.
5_
Onyouranswersheet,findthenumberwhichcorrespondstoyouritemandshadethespacehayingthe__sameletter
as
theansweryouhavechosen.Lookatthesampleitembelow.SampleItemPrimecostiscalculatedbyaddingdirectfactoryexpensesto
the
(A)
(B)
(C)
(D)
costofgoodssoldcostofmaterialsusedcostofrawmaterialssaleoffinishedgoodsSampleAnswerThebestanswertothisitem
IS
"costofmaterialsused",so
answer
space(B)hasbeenshaded.Ifyouwanttochangeyouranswer,besuretoerase
it
completelybeforeyou
fill
inyournewchoice.
When
youaretoldtobegin,turnthepageandworkas
quickly
andascarefullyasyou
can.
If
youcannot-,answeranitem,omititandgoontothenextone.Yourtotalscorewillbethetotalnumberofcorrectanswers.
You
may
do
any
roughwork
inthis
booklet.
Youmayusesilentnon-programmablecalculatorstoanswerquestions.
DONOTTURNTHISPAGEUNTILYOUARETOLDTODOSO.
Copyright
©
2008CaribbeanExaminationsCouncil.®Allrightsreserved.
221I60IO/CAPE2008
--
 
]
.
WhichofthefollowingBESTdefinestheconceptof'economicscarcity'?
(A)
Goodsandservicestoconsumersare
in
short
supply.
Humanwantsaregreaterthantheeconomy'sresources.Therearenotenoughresourcesavailableatpresent.Thewantsofsocietyaregreaterthanthesupplyofgoods.
(B)
(C)
(D)
2.
Scarcityreguirestheproducersofgoodsandservicestomakedecisionssuchas
1.
what
toproduceII.forwhomtoproduceIII.howproductionshouldbecarriedout
TV.how
manybusinessestheyshouldoperate(A)
(B)(C)
(D)
1andIVonly
11
andIVonly
1,
n
andHIonly
I,IIandIVonlyItems3-4.refertotheproductionpossibilityfrontiershownbelow.
good
y
3.Inthiseconomy,ashiftofthecurvefromItoIIillustratestheeffectsof
(A)
increasingreturns
(B)
inefficiency(C)recession
(D)growth
'22
I
J
60
I
ivc:»:
PE1008
-2-
4.
ThestatementthatBESTexplainstheshiftofcurvefromT
to
IIis(A)
(8)(C)(D)
anincreaseininputcostsadecreaseinavailabletechnologyadiscoveryofnewsourcesofrawmaterialsadeteriorationinthequalityofnaturalresources
5.
Whichofthefollowingstatementsis
correct
aboutsocialcost?
(A)(B)
(C)
CD)
6.
Privatecostsequalexternalcosts.Privatecostsplusexternalcostsequalsocialcosts.Privatecostsminusexternalcostsequalsocialcosts.Privatecostsequalsocialcosts.Whichofthefollowingisanexampleofanormanveeconomicstatement?(A)TIlegovernmentshouldprovidefreemedicationforseniorcitizens.
(B)A
reductioninthepriceofgoodswillbenefitconsumers.
(C)
(D)
Anincreaseininterestrates
win
attractforeigninvestors.Anincreaseintheminimumwagewillincreaseinflation.
COONTOTHENEXT
PAGE
 
7.
The
demand
curvefor
an01111al
goodissaidtobenegativelysloped.WhichofthegraphsbelowwouldNOTrepresentanormalgood')
(A)Price
s
p------
D
Q
Quantity
(B)Price
s
P-----
D
Q
Quantity
(C)
Price
s
D
Quantity(D)Price
s
P
l-----------r~----
D
QQuantity
22I1601O/CAPE2008
-3-
Item8referstothefollowingdiagramwhichshowsthe.demand
CUI've
forapples.
Price
8.
s
.
D
Quantitydemanded
Oneexogenousvariablethatwouldaffectthedemandforapplesis
(A)
(B)
(C)
(D)
supply
income
thepriceofapplesquantitydemandedItems9
10
refertothesituationdescribedbelow.Afterrunningaone-mileraceDwightdrank3glassesofwater.Hegot20utilsfromdrinkingthefirstglassofwater,23utilsfromdrinkingthesecondglassandLOutilsfromdrinkingthethirdglassofwater.
9.
WhatisDwight'stotalutilityafterconsumingthesecondglassofwater'?
(A)
(B)
(C)
(D)
3
234363
10.
WhatisDwight'smarginalutilityafter...consumingthesecondglassofwater?
(A)(B)
(C)
(D)
3
23
4363
GOONTOTHENEXTPAGE

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