“SRI LANKAN INTERNATIONAL SCHOOL RIYADH - KSA Admission Noz i Ctass: [| [I G8: Economics (9-1) Microeconomics and Business Economics (Level 1/2) Time: 02 hours Semester 01 Examination, December - 2018 ‘Fotal Marks % Monday, 24""December-2018 Instructions to Candidates Fill in the boxes at the top of this page with your admission number and class. a ‘This paper contains 04 questions on 11 pages. Answer all questions and answer the questions in the space provided w Do not use paper clips, highlighter, glue or correction fluid. wt Copying will result in zero marks, Information for Candidates ‘The total mark for this paper is 80. ‘The marks for each question are shown in brackets (). 2 io Advice to Candidates it Read each question carefully before you start to answer it Try to answer every question. ‘Check your answers, if'you have time at the end. Write your answers neatly and in good English, Total Marked by Checked by Department of Commerce ‘Sri Lankan International School-Rivadlh, KSASome questions must be answered witha evoss iv box D9, IFyou change your mind about an answer, puta line through the box P& and then mark your new answer with a cross DS. Answer ALL questions, Write your answers in the spaces provided. Qt Below figure 1, shows the UK sales of compact disc (CD) musi albums and music album downloaded from the intemet (Digital albums) in 2010 and 2011 Figure oF +00 90 80 7% 60 50 40 30 2» 0 BB co music atbumne 2A Digtalabums Seles in millions (@) The term used to describe the relationship between CD music albums and digital albums is; [2 marks] inferior goods Substitute goods ol ale >| (b) The below figure shows the UK market for Figure 02, Price | | he “Riyadh, KSAchange in price fom to PL in the above diagram, is most likely to have been caused by [2 marks] erease in population An A decrease in supply An increase in adver ing D | A decrease in the income of consumers (©) ‘The below figure shows the UK demand and supply curve for CD music albums, Refer to figure OF. {4 mks} Figure 03, On the above figure, fill in the missing labels A, B, C and D by using words from the list below & write in the space. ‘Supply et __ me elasticity _| Inflation | Quantity Demand & Supply | Cross clasticit Demand eneve | Opportunity costs Price (4) What is meant by an effective demand? [2 marks}° ( Using the diagram below, answer ALL the questions that follow, Figure 04 Ye oe tty 50 60 70 80 90 Quantity demanded (units) (1) Whatis the quantity of goods that would be bought at the price $8? {2 marks](ii) If the seller needs to stil a total of 80 units oF goods, what isthe prive thal the seller neds charge from the customer? (2 marks} (ii) What is the total revenue (TR), when the price is $62 Shade the TR area in the above diagram, [4 marks] Gv) Whatis the price elasticity of demand (PED), when the price falls from $8 to $6? Show your working below. [4 marks] (e) “A change in price causes a movement of the point along the demand curve”. Explain this statement by using a demand curve diagram at different price levels. (Hig, at least 03 price fevels) [4 marks} Deparirient of Canwmerco‘Total marks for Question 1:36 Please turn aver>>> Department of Commerce SriLankan international School - Riyadh, KSAThe below diagram represents the UK market for ice eream Figure 05 ‘an increase in costs ‘An inerease in indirect tax ‘An inerease in demand ‘An increase in productivity {b) Which of the following will cause the supply curve for motor cars to shift to the teft? ‘Atise in income [2 marks} [2 marks]L Department of Commerce [4 imarks} (i) What is the quantity of goods that would be supplied/sold at the price of $80.00? (ii) A what price is the supplier willing to sell 500 units of quantity of his product? “Ht 709 aE cwanny [2 marks} [2 marks] SriLankan internotional School Riyadh, KSA(iii) What is the total revenue (TR) for producer, when the price is $40? Shade the TR area in the above diagram, {4 msacks] (“A change in price causes a movement of the point along the supply curve” Explain this statement using «a supply curve diagram at different price levels. (eg. AX least 03 price levels) [4 marks} ‘Total marks for the question 2: 22 Department of Commerce & SriLankan Iniernational Schoo! - Rivadh, KSAa3: ‘The figure below shows the demand aud supply for laptop computers, | Demand per anonth (00's) | 500 | ep gt @> (a) Using the table above, draw a fully labelled demand and supply curve diagram in the graph [6 marks] (b) What is the equilibrium price and quantity of laptop computers [2 marks} (c) What is the total revenue (TR) al the equilibrium price? Shade the TR area in the above diagram. [4 marks} Department of Commerce a(@) Al price § (00 there is [2 marks] | fe (| Excess demand | A B | Equilibrium D [No demand (c) Define price elasticity of demand (PED)? {2 marks} (0. When price rises from $800 to $900, what is the price elasticity of demand (PEDY?, Show your workings below. [4 marks] ‘Fotat marks for question 03: Department of Commerce ‘SriLankan international School - Riyadh, KSA.OA. (a) Explain with the help of diagrams, how the demographic or population changes affect the demand curve changes? (Note: Consider when other factor changes) [4 marks] (b) Explain with the help of diagrams, how the technological elanges affect the supply curve changes? (Note: Consider when other factor changes) [4 marks] ‘Total marks for question 04: 08 Ends! ‘Total marks for this paper: 80 Ti SriLankan International School -