ADMISSION

NUMBER

DATE

FIRST EXAMINATION - NOVEMBER 2022

GRADE 10 (EDEXCEL)

ECONOMICS
PAPER 2
Duration : 1 hour and 30 minutes

Instructions

• Use black ink or ballpoint pen.

• Answer all questions.
• Answer the questions in the spaces provided – there may be more space than you need.
• Calculators may be used.
• You are advised to show all your working, with your answer clearly identified at the end of
your solution.
Information
• The total mark for this paper is 80.
• The marks for each question are shown in brackets – use this as a guide as to how much time to
spend on each question.
Advice
• Read each question carefully before you start to answer it.
• Try to answer every question.
• Check your answers if you have time in the end.

Grade 10 (Edexcel) Economics II - First Examination - November 2022

Prepared for Lyceum International Schools by Lyceum Assessments
 2
1. (a) In 2022 the government and the central bank of Sri Lanka increased the rate of interest from
10% to 70%. An increase in interest rates is an instrument of

A Fiscal policy
B Monetary policy
C Supply-side policy
D Regional policy
(1 mark)
(b) Which of the following is a benefit of Economic Growth?
A Higher cost of Living
B Higher levels of employment
C Higher levels of taxation
D Lower government spending
(1 mark)
(c) What is meant by the term unemployment?
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(2 marks)

(d) What is meant by the term trade-off?

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(2 marks)
(e) Calculate, to two decimal places, the rate of unemployment in a country that has a labor
force of 72 million of which 8 million are unemployed. You are advised to show your
workings.

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(2 marks)
Grade 10 (Edexcel) Economics II - First Examination - November 2022
Prepared for Lyceum International Schools by Lyceum Assessments
 3
(f) In November 2018, Mexico’s current account deficit increased to $5.082bn. Explain one
reason why the quality of domestic goods might have resulted in this increase in the current
account deficit for Mexico.

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(3 marks)

(g) What is meant by the term relative poverty?

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(3 marks)

(h) Explain why an increase in the rate of interest might lead to an increase in the level of
unemployment.

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Grade 10 (Edexcel) Economics II - First Examination - November 2022
Prepared for Lyceum International Schools by Lyceum Assessments
 4
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(6 marks)
[Total = 20 Marks]

2. (a) Which of the following is most likely to rise if the money supply grows too quickly?
A Inflation
B Supply of Labour
C Voluntary unemployment
D Current account surplus
(1 mark)
(b) What is the name given to a country’s exports and imports of services?
A Visible trade
B Invisible trade
C Transfer payments
D The balance of payments
(1 mark)

Grade 10 (Edexcel) Economics II - First Examination - November 2022

Prepared for Lyceum International Schools by Lyceum Assessments
 5
(c) A recent report estimates that 23% of the gross domestic product (GDP) in Greece is from
revenue that goes unrecorded by the government.

Explain one possible reason why a large percentage of Greece’s GDP might be unrecorded.
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(3 marks)
(d) Explain the concept of ‘Quantitative Easing’.
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(2 marks)
(e) Explain two strategies implemented by the government in order to increase the supply of
the country.

(i) ---------------------------------------------------------------------------------------------------------
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Grade 10 (Edexcel) Economics II - First Examination - November 2022

Prepared for Lyceum International Schools by Lyceum Assessments
 6
(ii) ---------------------------------------------------------------------------------------------------------
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(4 marks)

A new report from New Zealand Kiwifruit Growers Incorporated showed a serious shortage
of seasonal workers. This could slow down the kiwifruit industry’s predicted growth. The
report showed that the industry will require an additional 7,000 seasonal workers if it is to
double in size by 2027. Revenue from the sale of kiwifruits was predicted to increase from
NZ$2.1bn in 2017 to NZ$4bn by 2027. At the start of the 2018 season, the industry was
short 1,200 workers with 70% of the crop still to be picked.

(f) With reference to the data above and your knowledge of economics, assess the ways a
country such as New Zealand could reduce the shortage of seasonal workers.

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Grade 10 (Edexcel) Economics II - First Examination - November 2022

Prepared for Lyceum International Schools by Lyceum Assessments
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(9 marks)

[Total = 20 marks]
Grade 10 (Edexcel) Economics II - First Examination - November 2022
Prepared for Lyceum International Schools by Lyceum Assessments
 8
3. (a) A fiscal surplus occurs when,
A A country exports more than it imports
B Government revenue is greater than government expenditure
C A country imports more than it exports
D government expenditure is greater than government revenue
(1 mark)
(b) Low-interest rates to promote economic growth might do which of the following?
A Cause Inflation
B Result in higher levels of unemployment
C Increase a current account deficit
D Decrease the private sector investment
(1 mark)
(c) Explain two strategies implemented by the government to reduce poverty.

(i) ---------------------------------------------------------------------------------------------------------
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(ii) ---------------------------------------------------------------------------------------------------------
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(4 marks)

Grade 10 (Edexcel) Economics II - First Examination - November 2022

Prepared for Lyceum International Schools by Lyceum Assessments
 9
(d) The rate of inflation in Egypt decreased from 4.1% in January to 2% in February. Explain
one reason why low and stable inflation is a macroeconomic objective for a country such as
Egypt.

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(3 marks)

(e) In January 2020, the South American Monetary Policy Committee decided to increase
interest rates by 0.35% to 7.75%. This decision affected the currency of South America.
Analyze the likely impact of an increase in interest rates on the currency of South America.
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Grade 10 (Edexcel) Economics II - First Examination - November 2022
Prepared for Lyceum International Schools by Lyceum Assessments
 10
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(6 marks)

(f) The annual rate of inflation in India was 5.7% in January 2022 and fell to 5.53% in March
2022. Analyze how monetary policy could be used to further reduce the rate of inflation in
India.

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Grade 10 (Edexcel) Economics II - First Examination - November 2022
Prepared for Lyceum International Schools by Lyceum Assessments
 11
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(5 marks)
[Total = 20 Marks]

4. (a) Which of the following measures will help to improve occupational mobility?
A Investment in government training schemes
B Increase in unemployment benefit
C Lower rates of income tax
D Privatization
(1 mark)
(b) More environmental protection is likely to be needed if the government follows which of
the following cause of action?
A Drives inflation down too quickly
B Stimulates the economy to grow faster
C Tries to cut inflation
D Tries to cut a current account deficit
(1 mark)

Grade 10 (Edexcel) Economics II - First Examination - November 2022

Prepared for Lyceum International Schools by Lyceum Assessments
 12
(c) Examine the impact of a cut in interest rates on any three macroeconomic objectives.

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Grade 10 (Edexcel) Economics II - First Examination - November 2022

Prepared for Lyceum International Schools by Lyceum Assessments
 13
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(9 marks)

(d) Define the term “Money Supply”.

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(3 marks)
(e) An increase in the National Minimum Wage, will always increase the living standards for
low-paid workers. To what extent do you agree with this statement?
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Grade 10 (Edexcel) Economics II - First Examination - November 2022
Prepared for Lyceum International Schools by Lyceum Assessments
 14
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(6 marks)

[Total = 20 marks]

END

Ref : CJ

Grade 10 (Edexcel) Economics II - First Examination - November 2022

Prepared for Lyceum International Schools by Lyceum Assessments