CIE Econs IGCSE Mix 3

India is experiencing rapid growth in air travel. The number and size of airlines is increasing every year.

Which effect arising from this growth is an external economy of scale?

• Banks are more prepared to lend to large airlines rather than small airlines.

• Colleges are established to train flight crew.

• Fuel suppliers charge less to airlines that buy in bulk.

• Larger airlines operate aircraft which can carry more passengers.

The financial director of a company adds up the cost for the firm of rent, insurance, new machinery and the chief executive’s basic salary. The director then divides that total by the firm’s output.

What has the director calculated?

• average fixed cost

• average revenue

• average total cost

• average variable cost

If a perfectly competitive market becomes a monopoly, what will be likely to increase and what will be likely to decrease?

• A

• B

• C

• D

The diagram shows the fixed costs, variable costs and total costs of a firm.

What is the firm’s total variable cost at an output of 100 units?

• $250

• $5000

• $25000

• $30000

What is an example of a public good?

• a theatre performance

• an injection to prevent influenza

• road signs and road markings

• it may increase the volume of imports

The diagram shows the birth and death rates for a country over a period of time.

At which point did the country’s population fall?

• A

• B

• C

• D

The diagrams show population pyramids for two countries, X and Y.

What can be concluded from these pyramids?

• country X has the highest population

• country X is more typical of a developed country

• country Y has a higher birth rate

• country Y has a lower dependency rate

Which would cause a favourable change in the Kenyan trade in services (invisible) account?

• A Kenyan company wins a contract to transport exports from Uganda.

• A Kenyan tea company increases its exports.

• A Kenyan trade delegation visits India.

• A Zambian company increases its exports to Kenya.

What is most likely to result from an extension of specialisation in manufacturing?

• for the consumer some prices will be reduced

• for the country there will be less dependency on international trade

• for the employee the work will become more varied

• for the producer there will be less efficiency

The table shows the number of units of four currencies which exchanged for one US$ in 2003 and 2013.

In which country’s currency would imports have become cheaper?

• A

• B

• C

• D