Cambridge & Pearson Edexcel Past Paper Questions
Browse 35,704 questions from Cambridge O-Level & A-Level and Pearson Edexcel IGCSE & IAL exams. Click any question to practice.
A government decided to increase its expenditure on a major infrastructure project by building new roads. What would decrease the multiplier effect...
A country is in recession with unused resources. The government reduces interest rates. What do Keynesian economists believe the short-run outcome ...
The diagram shows the investment schedule of an economy. [Figure: Diagram showing rate of interest (%) on y-axis, investment on x-axis, with two do...
When will an inflationary gap exist in an economy? A when aggregate demand is greater than full employment income B when leakages exceed injections...
What is the basic assumption underlying the accelerator theory? A Investment depends on the level of business confidence. B Investment depends on t...
The table shows data on the unemployment and inflation rates for four countries in 2010 and 2014. country | unemployment rate (% of workforce) 2010...
What is most likely to be an appropriate government action to reduce both a balance of payments current account surplus and the rate of inflation? ...
In which situation are there definitely positive externalities?
A cost-benefit analysis is carried out on the construction of a hydroelectric power station. Which combination of circumstances would be most likel...
What does not pose a threat to the achievement of allocative efficiency?
The diagram shows budget lines and an indifference curve. The consumer's initial position is T. The price of good X then falls. Which combination o...
The diagram shows various combinations of apples and rice which are potentially available to a consumer. If standard indifference curves were added...
The schedule shows the short-run marginal cost of producing good X. units of X 1 2 3 4 5 marginal cost ($) 45 40 30 20 20 Given that the total fixe...
What must be found in two markets for price discrimination to be profitable?
A firm maximises its profits by maximising its total revenue. What does this imply?
Technological change reduces the minimum efficient scale of production in an industry. What is likely to result?
The diagram shows the costs and revenue for a firm in imperfect competition. Which level of output would produce only a normal profit? [Figure 10.1]
What would be a reason why small firms do not survive?
What is the implication of a dominant oligopoly following a limit pricing policy?
Transport economists estimate the price elasticity of demand for private car use is very low. What would be the most effective way of reducing road...
What would help to explain why there was a reduction in wage inequality in a country during the post-2008 economic recession?
How is marginal revenue product calculated?
A firm currently employs 30 workers at a daily wage of $50 each. The marginal cost of employing one extra worker is $112 per day. By how much will ...
In the diagram, HN is the initial supply of labour curve faced by a firm, and RM is its initial marginal cost of labour curve. What will be the fir...
Output per worker in an industry increases more slowly than the industry's total output. What could explain this?
On a diagram showing a production possibility curve, what definitely represents long-run economic growth?
When is economic growth most likely to promote economic development?
Which items in the table are classified as foreign aid? foreign direct official portfolio investment development investment assistance flows A no n...
Country X's living standards were compared with country Y's living standards using real GNP per head converted into US dollars. Country X was ranke...
In 2007 Turkey had a population of 73 m. Its labour force was 36m, of which 12m were trained for the primary sector and 24m were trained for the se...
An economy's manufacturing share of real GDP fell from 30% in 1970 to 12% in 2016. What type of unemployment would result from this?
In an open economy, when autonomous investment increases by 100, equilibrium national income increases by 300. Which conclusion can be drawn?
The diagram outlines the monetary transmission mechanism following an expansionary central bank intervention (quantitative easing). Key actions hav...
In Keynesian monetary theory, when will an increase in the supply of money not cause a fall in interest rates?
The diagram shows an economy in equilibrium at point X. What would be most likely to cause the economy to move from point X to point Y? [Figure 28.1]
The table identifies pairs of possible government aims. In which case is achievement of aim 1 likely to be consistent with the achievement of aim 2...
What is most likely to result from the discovery of oil reserves in a developing economy?
Which condition must be met for economic efficiency to be achieved? A Marginal social benefits are at a maximum in the production of all goods. B M...
What is a characteristic of a merit good? A free at the point of use B has zero marginal costs C non-competitive in use D possesses positive extern...
Which statement is correct? A External benefit minus private benefit equals social benefit. B Private benefit minus external benefit equals social ...
When does a consumer achieve maximum total utility (TU), according to marginal utility (MU) theory for two goods, X and Y, with different prices (P...
The diagram shows a change in a consumer's budget line from RR to SS. [Figure 5.1] What might explain why this occurred? A a decrease in income and...
When shirts are produced, fixed costs are $100 and the variable cost is $5 per shirt. If the price is $10, which output would result in normal prof...
The table shows four market structures. | market structure | barriers to entry | differentiated products | |---|---|---| | A monopolistic competit...
A firm abandons its policy of horizontal expansion and switches to a policy of backward vertical growth. What does this suggest is most likely abou...
What identifies the output level required to meet the stated aim of the firm? | aim of firm | produce at output where | |---|---| | A maximum effi...
What makes it likely that firms will collude in setting prices for a particular product? A a highly contestable market structure B a small number o...
The diagram shows a firm's marginal and average cost curves. The firm enters a collusive agreement with other firms in the industry. It is agreed t...
The diagram shows a notice on a motorway near Cambridge. [Figure 12.1] This road was recently cleared of 17 bags of litter. Clearing litter puts lo...
A reason for government intervention in the workings of the economy is to attempt to correct for market failure. Sometimes, though, government fail...