A-Level Economics

Question 1

In Singapore's A-Level Economics, what is the concept of 'scarcity'?

Accepted Answer

The fundamental economic problem that human wants are unlimited but resources are limited

Answer

Not having enough money

Answer

A shortage of goods in shops

Answer

Having too many resources

Question 2

What determines the price elasticity of demand for a good?

Accepted Answer

Availability of substitutes, proportion of income spent, necessity vs luxury, and time period

Answer

Only the price of the good

Answer

Only the income of consumers

Answer

Only the cost of production

Question 3

What is a 'market failure' in the context of Singapore economics?

Accepted Answer

When the free market fails to allocate resources efficiently, leading to a welfare loss

Answer

When a business goes bankrupt

Answer

When share prices fall

Answer

When consumers refuse to buy goods

Question 4

How does Singapore's government use the Certificate of Entitlement (COE) system to manage car ownership?

Accepted Answer

By limiting the number of new vehicles through a quota system where COEs are bidded for

Answer

By setting a fixed car price

Answer

By banning car imports

Answer

By subsidising public transport only

Question 5

What is 'comparative advantage' in international trade?

Accepted Answer

A country's ability to produce a good at a lower opportunity cost than another country

Answer

A country that produces the most of a good

Answer

Having more natural resources

Answer

Having lower wages than other countries

Question 6

What is the multiplier effect in Singapore's macroeconomic context?

Accepted Answer

An initial injection of spending leads to a more than proportionate increase in national income through successive rounds of spending

Answer

Doubling of prices

Answer

Increasing tax rates multiplied by income

Answer

The effect of population growth on GDP