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General Certificate of Education Advanced Level

ECONOMICS                                                                                                                             9158/3

NOVEMBER 2013 SESSION            3 hours

TIME     3 hours


  • Write your name, Center number and candidate number in the spaces provided on the answer sheet/answer booklet.
  • Answer any four questions.
  • Write your answers on the separate answer paper provided.
  • If you use more than one sheet of paper, fasten the sheets together.


  • The number of marks is given in brackets
[] at the end of each question or part question.
  • You are reminded of the need for good English and clear presentation in your answers.
  • 1        a) Explain what is meant by the basic economic problem.                           [10]

    b) Discuss the benefits of changing from a command economy to a market economy.   [15]

    2        a) Analyse the factors influencing price elasticity of demand for cement  in your country. [10]

    b) To what extent are elasticity of demand concepts useful to the housing construction industry? [15]

    3        a) Account for the continued survival of small firms despite competition from large firms. [12]

    b) Discuss whether large firms serve the society better than small firms.       [13]

    4         a) Explain

    i)  normal profit,

    ii) abnormal profit.                          [10]

    b) Discuss whether profitable firms are efficient.              [15]

    5          a) Explain

    i) net advantage,

    ii) economic rent,

    iii) quasi-rent                     [12]

    b) Discuss whether the level of workers’ wages depends on the strength of their trade union.  [13]

    6         a) Explain

    i)  public good,

    ii) demerit good,

    iii) negative externality.                     [12]

    b)   Discuss how government may deal with market failure in an economy.   [13]

    7           a) Explain how the comparative advantage theory determines international trade.  [12]

    b)  To what extent does the comparative advantage theory explain trade flows between countries? [13]

    8           a) Analyse the problems of measuring national income in your country.   [12]

    b) Discuss the usefulness of national income statistics in an economy.       [13]

    9           a) Explain

    i) demand-pull inflation,

    ii) cost-push inflation.                     [12]

    b) Discuss the effects of a substantial increase in money supply in an economy.  [13]

    10         a) Analyse factors influencing economic growth in your country.          [12]

    b) Discuss the benefits of economic growth to an economy.          [13]

    11          a) Analyse the effects of unemployment in an economy.     [10]

    b) Discuss the effectiveness of measures meant to reduce unemployment in your country. [15]

    12          Assess the benefits to a developing country, of developing through policies of trade and industrialisation. [25]


    To access more exams go to the A Level Economics Examination page.