A-Level H2 Economics

Question 1

What is 'ceteris paribus' in economics?

Accepted Answer

All other things being equal or held constant

Answer

'Ceteris paribus' is a Latin phrase meaning 'all other things being equal'. It is used to analyse the effect of one variable by assuming all other variables remain constant.

Question 2

What happens to the demand curve for a normal good when consumer income rises?

Accepted Answer

Demand curve shifts right

Answer

For a normal good, demand increases as income rises. This shifts the entire demand curve to the right (an increase in demand), not a movement along the curve.

Question 3

What is price elasticity of demand (PED)?

Accepted Answer

The percentage change in quantity demanded divided by the percentage change in price

Answer

PED = (% change in quantity demanded) / (% change in price). It measures the responsiveness of quantity demanded to a change in the price of the good.

Question 4

In Singapore, which market structure best describes the mobile telecommunications industry?

Accepted Answer

Oligopoly

Answer

Singapore's mobile telecommunications market is an oligopoly — a few large firms (Singtel, StarHub, M1, and TPG) dominate, with high interdependence, barriers to entry, and strategic pricing.

Question 5

What is a 'public good' in economics?

Accepted Answer

A good that is non-excludable and non-rival in consumption

Answer

A pure public good is non-excludable (cannot prevent anyone from consuming it) and non-rival (one person's consumption doesn't reduce availability to others), e.g., national defence.

GCE A-Level Practice Test

GCE A-Level Practice Test

A-Level H2 Economics