Worksheet : 1 Name : ___________________

Grade : IGCSE - I Date : ____/____/_____________

Subject : ECONOMICS Teacher’s signature : _________

Topic : THE NATURE OF THE ECONOMIC PROBLEM,

FACTORS OF PRODUCTION, OPPORTUNITY COST

Q.I) For each of the parts (1) to (5) below there are four possible answers A, B, C and D. Choose the one
you consider correct and place a tick (✓) to indicate the correct answer.

1) The best alternative forgone also means

a) Economic good
b) Free good
c) Opportunity cost
d) Capital good

2) Mobility of enterprise depends on the

a) Mobility of land
b) Mobility of labour
c) Mobility of entrepreneur
d) Mobility of capital

3) Economic goods

a) Do not involve opportunity cost

b) Do not involve resources
c) Involve both resources and opportunity cost
d) None of the above

4) A country produces 2000 new capital goods in a week. 500 of these replace worn out capital goods.
What is the net investment made?

a) 1500
b) 2500
c) 500
d) 2000

5) Free goods

a) Involve resources
b) Involve opportunity cost
c) Do not involve resources
d) None of the above

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 Case Study

Answer the following question.

In 2018 a Chinese firm announced that it would be starting a project to use the power of waves off the coast in
Goa India. More entrepreneurs are becoming interested in making use of the wave power which is a free good.
More labour is likely to be employed in the industry. The quantity of labour has increased in recent years.

a) Define entrepreneur.

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b) Explain the difference between a free good and an economic good.

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 c) Discuss whether the quantity of labour in India is likely to increase in the future or not.

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d) Discuss what factors of production would be used in setting up the project in India.

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 ______________________________________________________________________________________

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e) Discuss how every enterprise uses opportunity cost to run a successful business.

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 Worksheet : 2 Name : ___________________
Grade : IGCSE - I Date : ____/____/_____________
Subject : ECONOMICS Teacher’s signature : _________
Topic : PRODUCTION POSSIBILITY CURVES
MICROECONOMICS AND MACROECONOMICS
THE ROLE OF MARKETS IN ALLOCATING RESOURCES

Q.I) For each of the parts (1) to (4) below there are four possible answers A, B, C and D. Choose the one
you consider correct and place a tick (✓) to indicate the correct answer.

1) What are directives?

A. State instructions given to private enterprises

B. State instructions given to state owned enterprises
C. State instructions given to joint enterprises
D. State instructions given to private and state owned enterprises

2) The decision makers in microeconomics and macroeconomics are known as

A. Economic agents
B. Economists
C. Entrepreneurs
D. Government

3) What does a production possibility curve show?

A. The amount of capital and labour in a country

B. The output of two products that can be produced with given resources
C. The popularity of two products
D. The price of the two products that are produced with the given resources

4) Market disequilibrium is

A. Demand and supply are equal

B. Demand and supply are not equal
C. Demand is lesser than supply
D. Demand is greater than supply

[Link] 1
 [Link]) Answer the following questions.

Case study

India is moving from a planned economic system to a market economic system. The government is however
worried whether this change would be in favour of the country's growth or not.

1. Define and explain the features of a planned economic system.

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2. What are the features of a market economic system?

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 _____________________________________________________________________________________

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3. Analyse whether it would be beneficial or not for India to move from a planned economic system to a market
economic system.

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 4. Discuss the relationship between the price mechanism and the market economic system.

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 Worksheet: 3 Name: _____________________
Grade : IGCSE I Date : _____/_______/_______
Subject : Economics Roll No. : ______
Topic : Demand, Supply & Teacher’s Signature: ________
Price Determination

Q. I) For each of the parts below there are four possible answers A, B, C and D. Choose the one you
consider correct and place a tick (√ ) to indicate the correct answer.

1. The total demand of all the potential buyers is also referred to as

A. Demand
B. Supply
C. Aggregation
D. Extension in demand

2. What is a payment by a government to encourage the production of a product?

A. Tax
B. Subsidy
C. Salary
D. Wages

3. A rise in the quantity demanded caused by a fall in the price of the product itself is known as

A. Contraction in demand
B. Extension in demand
C. Increase in demand
D. Decrease in demand

4. A rise in supply at any given price, causing the supply curve to shift to the right is known as

A. Increase in supply
B. Decrease in supply
C. Increase in demand
D. Decrease in demand

[Link] 1
 5. The table shows the changes in two influences on the demand for and supply of televisions. If these two
changes occurred at the same time, in which case is it impossible for the price of televisions to rise?

Consumers’ incomes Costs of Production

A Rise Fall
B Rise Rise
C Fall Fall
D Fall Rise

6. Due to changes in the costs of production, an industry’s supply curve shifted at various times from S1 to
either S2 or S3.

S2
Price S1
W
X S3
Y

D2
D1

0 Quantity

If a shift in supply was due to a seasonal increase in the cost of raw materials, what would have been the
effect on Demand?

A. The quantity demanded would move from X to Y.

B. The quantity demanded would remain the same at X.
C. The demand curve would move from D1 to D2.
D. The quantity demanded would move from X to W.

7. Wet weather in 2015 led to a fall in the sales of summer clothes in England. To support the businesses
the government reduced the Sales tax (VAT). How would these events be shown on a demand and supply
diagram for summer clothes?

Demand Curve Supply Curve

A Move to the right Move to the left
B No Change Move to the right
C Move to the left Move to the right
D Move to the left No Change

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 8. Drought in African countries often results in poor harvests. Other countries then help by sending quantities
of food. What are the likely results of these events for the price of food on the drought-affected countries?

A. It will rise and remain at this higher level.

B. It will rise and then fall.
C. It will fall and then rise.
D. It will rise and continue to rise.

9. What is not held constant in constructing an ordinary demand schedule?

A. The price of the good itself

B. The tastes of Consumers
C. The incomes of Consumers
D. The prices of complementary goods

10. Price is initially set above equilibrium. Market forces then move it towards equilibrium. As price falls, what
will happen to demand and supply?

Demand Supply
A. Contracts Contracts
B. Contracts Extends
C. Extends Contracts
D. Extends Extends

[Link]) Answer the following questions by reading the Case study

The market for mobile phones had seen an increase in the sales recently. There were many other
factors that favoured the growth of the sales. One important factor was the demand for smartphones
as an added feature. However the prices of mobile phones has not decreased.

1. Define Demand.

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2. Explain the relation between the supply and the price of mobile phones.

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 3. Discuss whether or not the improvements in technology would affect the supply of mobile phones.

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4. Describe what can influence the demand for Mobile Phones.

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5. Using a Demand and Supply diagram, analyse how an increase in income can affect the equilibrium
price and equilibrium quantity of Mobile Phones.

6. Give two specific reasons why the supply curve of a product may shift to the right.

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 Worksheet : 4 Name : ________________

Grade : IGCSE - I Roll No : ________________

Date : ________________
Subject : ECONOMICS
Teacher's Sign : ___________
Topic : Price Elasticity of Supply & Market Economic System

Q. I) For each of the parts below there are four possible answers A, B, C and D. Choose the one you
consider correct and place a tick (√ ) to indicate the correct answer.

1. What is meant by Price Elasticity of Supply?

A. The extent to which price changes when there is a change in supply.

B. The extent to which a firm can raise the price of a product whilst keeping the supply unchanged
C. The responsiveness of supply to a change in the cost of production.
D. The responsiveness of supply to a change in price.

2. A product has a price elasticity of supply of 0.8 and a price of $60. By how much would price have to
increase to cause supply to rise from 200 to 240?

A. $8
B. $15
C. $30
D. $48

3. This is an advantage of the Market Economic System.

A. It aims for equality of income.

B. It ensures the provision of defence and law and order.
C. It gives an incentive to produce.
D. It reduces pollution and congestion.

4. What is not true of a Market Economic System?

A. There is a mixture of agricultural, manufacturing and service industries.

B. There is a mixture of central authorities, firms and consumers.
C. There is a mixture of external benefits and private costs.
D. There is a mixture of large and small companies.

5. When products are produced at the lowest possible cost and making full use of resources, such efficiency is
called

A. Dynamic Efficiency
B. Allocative Efficiency
C. Productive Efficiency
D. Moral Efficiency

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 6. When a fall in price of mangoes has no effect on the quantity supplied, we call it

A. Unit PES
B. Perfectly Elastic Supply
C. Perfectly Inelastic Supply
D. None of the above

[Link]) Answer the following questions by reading the Case study

It is estimated that if the price of Fidget Spinners increases by 4%, supply will alter by 6%.

1. Calculate the Price Elasticity of Supply of Fidget Spinners.

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2. Identify whether the Supply is Elastic or Inelastic. Explain why.

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3. If the supplier wishes to raise revenue, should he/she lower the price or raise the price of the spinners?

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 4. If the government want to encourage the output and consumption of a product whose supply is elastic, should
the government give subsidies to the manufacturers or should the government raise taxes on the product?
Why?

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 Worksheet: 5 Name: _____________________
Grade : IGCSE I Date : _____/_______/_______
Subject : Economics Roll No. : ______
Topic : Mixed Economic System Teacher’s Signature: ________
Money and Banking, Households

Q. I) For each of the parts below there are four possible answers A, B, C and D. Choose the one you
consider correct and place a tick (√ ) to indicate the correct answer.

1. Which one of the following is not a function of a commercial bank?

A. Accepting Deposits
B. Lending Money
C. Printing notes
D. Making Payments on behalf of customers

2. What does APS stand for?

A. Average Propensity to Spend

B. Average Propensity to Sell
C. Average Propensity to show wealth
D. Average Propensity to save

3. Which of these falls under Contractual Savings?

A. Placing money in securities

B. Pension Schemes
C. Money in Bank
D. Placing money in shares

4. If anything is to be considered and used as money, it must be

A. Legal tender
B. In fixed supply
C. Acceptable readily
D. Indivisible

5. Which statement is correct?

A. APC states that as income increases APC increases

B. APS states that as income reduces APS increases
C. Commercial Banks settle debts by clearing customers’ cheques
D. Central Banks supply foreign currency to public directly

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 6. One of the below reasons may cause saving a higher proportion of one’s income.

A. Apprehension that income will reduce in the future

B. Fall in the rate of interest
C. Spending in order to immediately satisfy one’s desires
D. Apprehension that prices of goods will rise in the future

7. The table below shows in what percentage do Harry, Jim and Kirk spend their incomes.
Harry Jim Kirk
Housing and Food 25% 65% 35%
Higher Education 30% 20% 20%
Luxury 45% 15% 45%
What is the most likely order of income from the lowest to the highest income?

A. Kirk, Harry, Jim

B. Harry, Kirk, Jim
C. Kirk, Jim, Harry
D. Jim, Kirk, Harry

[Link]) Answer the following questions

1. How do Banks earn profits? Explain giving examples.

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2. Loans and Borrowings in USA in 2007 made a new record. There was more borrowing and less saving.
So much so that there was a drop in the savings ratio from 20% in 1995 to 3% in 2007. Explain (Analysis
required) any 2 ways in which the Central Bank might influence a reduction in borrowing.

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 3. Explain any 2 ways in which the government tries to arrest Market Failure.

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4. Gold can be exchanged as well as worn as Jewellery. Explain the concept of Money has no Intrinsic
Value in the context of gold.

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 Class Test : 1 Name : ____________________
Grade : IGCSE I Roll No. : ___ Date : __/___/___
Subject : Economics Duration : 35 mins Marks : 20
Topics : The nature of the economic problem, Factors of Production,
Opportunity Cost, Production Possibility Curve,
Microeconomics and Macroeconomics,
The role of markets in allocating resources

Q. I) For each of the parts (1) to (10) below there are four possible answers A, B, C and D. Choose the
one you consider correct and place a tick (√ ) to indicate the correct answer. [10]

1. Which statement about the factors of production is correct?

A. Raising finance for a company is called Capital.

B. Supervisors employed in a company are called Enterprise.
C. A river from which a company draws water is called Land.
D. The owner of a company is called Labour.

2. The problem of scarcity would increase due to one of the following factors

A. A discovery of a new oil field.

B. An increase in labour productivity.
C. A decrease in fish stock.
D. A reduction in waste

3. The choice of spending on either education or infrastructure is an example of one of the following

A. Substitution of Factors
B. Opportunity Cost
C. Conservation of Resources
D. Monetary Policy

4. What is meant by an equilibrium price?

A. A price that has no pressure to rise or fall

B. A price that maximizes the profits of the producers
C. A price that maximizes the satisfaction of the consumers
D. A government price that ensures fairness to all.

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5. Heavy rains caused floods in an area of a country. What maybe the opportunity cost of repairing the
damage caused?

A. The allocation of government funds to the area instead of on a new airport

B. The decline in the tourist industry in the area
C. The loss of profits from businesses affected by the flood
D. The cost of providing shelter for those made homeless

6. The diagram shows the production possibility curve for buses and utensils. A recession causes a decrease
in the production of both buses and utensils. Which movement would represent this change?

Buses
W

Y
Z

O Utensils

A. Z to W
B. Z to Y
C. X to Y
D. X to W

7. Which of these is not a Factor of Production?

A. The machinery in a factory

B. The shares of a company
C. The staff in an office
D. The fields of a farm

8. What is the government most likely to produce in a mixed economy?

A. No goods and services

B. Some of the goods and services
C. All of the services none of the goods
D. Amounts of goods and services equal to those of the private sector

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9. The nature of the economic problem is summarized in the following terms.

A. Finite resources and unlimited wants

B. Infinite resources and limited wants
C. Finite resources and limited wants
D. Infinite resources and unlimited wants

10. Which pair of economic institutions can be found in a market economy?

A. Nationalised industries and partnerships

B. Stock Exchange and Public Corporations
C. Monopolies and Commercial Banks
D. Local Government and Charities

Q. II) Solve the following

1. Define Market Disequilibrium.

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2. Define Economic Agents. Explain the aim of Households as Workers and as Savers.

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3. When is the PPC curve drawn as a straight line? Explain.

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4. Explain Quantity of Enterprise.

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 Class Test : 2 Name: ____________________
Grade : IGCSE I Roll No. : ___ Date : __/___/___
Subject : Economics Duration: 35 mins Marks: 20
Topics : Demand, Supply, Teacher’s Signature: ________
Price determination

Q. I) For each of the parts (1) to (6) below there are four possible answers A, B, C and D. Choose the
one you consider correct and place a tick (√ ) to indicate the correct answer. [6]

1. In a market there is a shortage of a good. What change would that cause the market to come to an
equilibrium?
A. A fall in price
B. A rise in price
C. A decrease in supply
D. An increase in Demand

2. A government taxes the production of cars. What is likely to decrease?

A. The supply of cars at every price
B. The price of cars
C. The revenue for the government
D. The cost of supplying cars

3. The diagram shows the demand for chocolate. What could cause the movement from point X to Y?

A. An increase in income
B. A change in taste and preference of people
C. A successful advertising campaign for chocolate
D. A fall in price of chocolate

4. What will be the impact on the market for gold of the closure of the world’s largest gold mine?
A. A movement down the supply curve
B. A shift of the demand curve to the left
C. A movement up the demand curve
D. A shift of the supply curve to the right

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5. What determines a consumer’s demand for a product?

The consumer’s The consumer’s The price of

income willingness to buy the the product
product
A. Yes No Yes
B. Yes Yes Yes
C. No Yes Yes
D. Yes Yes No

6. The diagram shows the market equilibrium E for a product X. Product X has a downward sloping demand
curve and an upward sloping supply curve. The price of a substitute falls. Into which area of the diagram
would the market equilibrium for product X move?

Q. II) Answer the following

1. Explain ‘Shortage’ and its impact on price.

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2. Explain Decrease in Supply.

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3. Using a Demand and Supply diagram, analyse how a situation of war can affect the equilibrium price and
equilibrium quantity of food. (4 marks for the diagram and 2 marks for analysis)

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4. Give two specific reasons why the demand curve of a product may shift to the left. (2 marks for the
identification of reasons and 2 marks for explanation)

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 Class Test : 3 Name: ____________________
Grade : IGCSE I Roll No. : ___ Date : __/___/___
Subject : Economics Duration: 35 mins Marks: 20
Topics : Price Elasticity of Supply Teacher’s Signature: _____
Market Economic System

Q. I) For each of the parts (1) to (6) below there are four possible answers A, B, C and D. Choose the
one you consider correct and place a tick (√ ) to indicate the correct answer. [6]

1. What is an advantage of a market economy in the allocation of resources?

A. It ensures that all consumers are willing to pay the same price.
B. It fixes prices based on costs of production.
C. It guarantees suppliers will make a profit.
D. It indicates the relative demand for goods and services.

2. The table shows the supply schedule for a good.

Price ($) Quantity (000)

1 3
2 5
3 7

What is the price elasticity of supply when price increases from $1 to $3?

A. 0.5
B. 0.66
C. 1.5
D. 2.0

3. What necessarily describes the market system?

A. an economy with both a private and public sector

B. limited resources but unlimited wants
C. resources are allocated through demand and supply
D. when all resources are used to produce consumer goods

4. The table shows the effect of a change in the market price from $5 to $6 on the supply of mobile (cell)
phones.

Price ($) Supply (units)

5 10 000
6 15 000

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 Which statement about the price elasticity of supply of mobile phones is correct?

A. Price elasticity of supply is 0.4.

B. Price elasticity of supply is 2.5.
C. Supply is perfectly elastic.
D. There is unit elasticity.

5. In a market system who has the most important role in influencing the allocation of resources?

A. consumers
B. entrepreneurs
C. government officials
D. producers

6. In response to an increase in price from $5 per kilo to $6 per kilo a chicken farmer increased supply from
400 kilos per week. The PES is 1.25. Find the new value of quantity.

A. 300 kilos per week

B. 500 kilos per week
C. 450 kilos per week
D. 475 kilos per week

Q. II) Answer the following

1. Define ‘Price Elasticity of Supply’.

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2. Give any 3 disadvantages of a Market Economic System. (3 marks for identification and 3 marks for
explanation).

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3. Define ‘Dynamic Efficiency’

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4. Explain any 2 Determinants of PES

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 Class test : 4 Name : _________________

Grade : IGCSE - I Roll No : ___ Date : __/___/__

Duration : 40 Mins
Subject : ECONOMICS
Marks : 20
Topic : Mixed Economic System; Money and Banking; Households

Q. I) For each of the parts (1) to (4) below there are four possible answers A, B, C and D. Choose the one
you consider correct and place a tick (√ ) to indicate the correct answer. [4]

1. What might cause consumers in a high-income economy to both save more and spend more?

A. An increase in wealth
B. Expectation that prices will fall in the future
C. Inflation rising at a faster rate than wages
D. An increase in the rate of interest

2. Banks decrease interest rates. What is likely to be the effect of this on borrowing and saving?

Borrowing Saving

A. Falls Falls
B. Falls Rises
C. Rises Falls
D. Rises Rises

3. What would most likely cause a person to increase their savings?

A. A fall in income
B. A fall in interest rates
C. A reduction in tax-free saving schemes
D. A decision to plan for retirement

4. People's income decreases. How is the proportion spent on food and leisure likely to change?

Food Leisure

A. Decrease Decrease
B. Decrease Increase
C. Increase Decrease
D. Increase Increase

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 Q. II)
1. Define 'Mixed Economic System'.

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2. Define 'Nationalisation'.

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3. Analyse why Households in one country may borrow more than Households in another country. (2 reasons)

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4. Explain the concept of Cost Benefit Analysis along with its definition.

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5. Explain how subsidies and taxes help reduce / arrest market failure.

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******

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