Paper 1: Microeconomics · H060/01

OCR AS Paper 1, June 2023

All 9 written questions and 15 multiple choice questions from OCR AS Paper 1 (June 2023), Microeconomics. Each question shows its marks and topic, and opens the question paper and mark scheme at the right page.

Question paper Mark scheme Examiner report

Section A

Q11 mark

Which of these contains all the four factors of production?

ACapital, enterprise, labour, land
BCapital, labour, profit, rent
CEnterprise, interest, land, wages
DInterest, profit, rent, wages

Show the answer

The answer is A.

TopicThe economic problem and resource allocation

Question paper p.2 Mark scheme p.9 Open in the tool

Q21 mark

What is the income elasticity of demand if a 10% increase in consumer income leads to a 40% decrease in quantity demanded?

A–4.00
B–0.25
C+0.25
D+4.00

Show the answer

The answer is A.

TopicDemand, supply and elasticity

Question paper p.2 Mark scheme p.9 Open in the tool

Q31 mark

Which of these is an example of a normative statement?

ATaxes on cigarettes provide the government with tax revenue
BThe government should raise taxes even higher on cigarettes
CThe tax on cigarettes accounts for 80% of the price of cigarettes
DVAT is one of the taxes charged on cigarettes

Show the answer

The answer is B.

TopicThe economic problem and resource allocationMacroeconomic objectives and policyGovernment intervention in markets

Question paper p.2 Mark scheme p.9 Open in the tool

Q41 mark

Opportunity cost is defined as the value of:

Aall alternative goods foregone
Bthe cost of other goods and services
Cthe cost imposed on a third party
Dthe next best alternative foregone

Show the answer

The answer is D.

TopicThe economic problem and resource allocation

Question paper p.2 Mark scheme p.9 Open in the tool

Q51 mark

The diagrams show the relationship between price and quantity supplied of a product. Which supply curve shows unit price elasticity of supply along the curve?

APrice S Quantity supplied
BPrice S Quantity supplied
CPrice S Quantity supplied
DPrice S Quantity supplied

Show the answer

The answer is C.

TopicDemand, supply and elasticity

Question paper p.3 Mark scheme p.9 Open in the tool Practise the PED and PES diagram

Q61 mark

Which item is most likely to be used as a medium of exchange in the UK?

AA fifty pound bank note
BA gold wedding ring
CA government bond
DA savings account

Show the answer

The answer is A.

TopicThe financial sectorThe economic problem and resource allocation

Question paper p.4 Mark scheme p.9 Open in the tool

Q71 mark

The table shows the quantity demanded and quantity supplied of a product at different prices. Price Quantity Quantity Demanded Supplied £10 100 £15 80 £20 75 £25 60 £30 40 At the equilibrium price, what is the total revenue?

A£1000
B£1200
C£1500
D£2400

Show the answer

The answer is C.

TopicDemand, supply and elasticityCosts, revenues and profit

Question paper p.4 Mark scheme p.9 Open in the tool

Q81 mark

Which of these is a cause of market failure?

APositive externalities
BPositive income elasticity of demand
CPositive price elasticity of supply
DPositive private costs

Show the answer

The answer is A.

TopicMarket failureDemand, supply and elasticity

Question paper p.4 Mark scheme p.9 Open in the tool

Q91 mark

Which of these would lead to a negative externality?

AA new firm which creates jobs for local people
BA new firm which processes coal, releasing carbon emissions
CInformation on the effects of smoking cigarettes
DSubsidy for solar-powered electricity

Show the answer

The answer is B.

TopicMarket failureGovernment intervention in markets

Question paper p.4 Mark scheme p.9 Open in the tool

Q101 mark

When will a subsidy have the most effect on quantity demanded?

ADemand is perfectly inelastic
BDemand is elastic
CDemand is inelastic
DDemand is unitary elastic

Show the answer

The answer is B.

TopicGovernment intervention in marketsDemand, supply and elasticity

Question paper p.5 Mark scheme p.9 Open in the tool

Q111 mark

Which of these defines an inferior good?

AQuantity demanded decreases when incomes decrease
BQuantity demanded decreases when incomes increase
CQuantity demanded decreases when prices increase
DQuantity demanded increases when prices increase

Show the answer

The answer is B.

TopicDemand, supply and elasticity

Question paper p.5 Mark scheme p.9 Open in the tool

Q121 mark

The price elasticity of demand of widgets is –1.0. If the firm raises the price of widgets by 5%, this is likely to have what impact on the firm's total revenue?

ADecrease by 5%
BDecrease by more than 5%
CIncrease by less than 5%
DNo change

Show the answer

The answer is D.

TopicDemand, supply and elasticityCosts, revenues and profit

Question paper p.5 Mark scheme p.9 Open in the tool

Q131 mark

The quantity demanded for oranges falls from 600 to 300 when the price of apples falls by 25%. In relation to the price of apples, what is the cross elasticity of demand for oranges?

A12.5
B6.0
C2.0
D0.5

Show the answer

The answer is C.

TopicDemand, supply and elasticity

Question paper p.5 Mark scheme p.9 Open in the tool

Q141 mark

Afirm has successfully introduced division of labour in its factory. Which of these is the most likely outcome? A Decrease in quantity supplied and decrease in equilibrium price
BDecrease in quantity supplied and increase in equilibrium price
CIncrease in quantity supplied and decrease in equilibrium price
DIncrease in quantity supplied and increase in equilibrium price

Show the answer

The answer is C.

TopicDemand, supply and elasticityThe economic problem and resource allocation

Question paper p.6 Mark scheme p.9 Open in the tool

Q151 mark

Which of these would lead to a fall in consumer surplus for a good?

ADecrease in cost of production
BDecrease in indirect tax
CIncrease in price
DIncrease in subsidy

Show the answer

The answer is C.

TopicGovernment intervention in marketsDemand, supply and elasticity

Question paper p.6 Mark scheme p.9 Open in the tool

Section B

Q16(a)1 mark

Using Fig. 1, state what percentage of people baked at home from scratch once a week or more often in 2017.

Question paper p.9 Mark scheme p.13 Examiner report p.2 Open in the tool

Q16(b)(i)2 marks

Using the information in the case study, explain why there was an increase in demand for flour.

TopicDemand, supply and elasticity

Question paper p.9 Mark scheme p.13 Examiner report p.2 Open in the tool

Q16(b)(ii)Explain2 marks

Explain what the price elasticity of supply is likely to be for flour.

TopicDemand, supply and elasticity

Question paper p.9 Mark scheme p.13 Examiner report p.2 Open in the tool

Q16(b)(iii)2 marks

Using the information in the case study, explain what impact the change in demand for yeast would have had on Red Star Yeast's producer surplus.

TopicDemand, supply and elasticity

Question paper p.9 Mark scheme p.13 Examiner report p.2 Open in the tool

Q16(c)4 marks

Using a diagram, explain the disequilibrium that existed in the flour market in 2020.

Question paper p.10 Mark scheme p.14 Examiner report p.2 Open in the tool Draw it: supply and demand diagram

Q16(d)Explain4 marks

Explain how a buffer stock system can be used to regulate the market supply of a product such as flour.

TopicDemand, supply and elasticityGovernment intervention in markets

Question paper p.10 Mark scheme p.14 Examiner report p.2 Open in the tool

Q16(e)Evaluate10 marks

Evaluate, using an appropriate diagram(s), the effectiveness of a government policy that can be used to encourage UK flour millers to increase supply.

Question paper p.11 Mark scheme p.15 Examiner report p.2 Open in the tool Draw it: subsidy diagram

Section C

Q17OptionalEvaluate20 marks

Evaluate, using an appropriate diagram(s), the effectiveness of imposing a tax on palm oil production to reduce negative externalities.

TopicMarket failure

Question paper p.14 Mark scheme p.17 Examiner report p.2 Open in the tool Draw it: negative externality diagram Or: indirect tax diagram

Q18OptionalEvaluate20 marks

Evaluate, using an appropriate diagram(s), whether a country would benefit from moving from a planned to a market economy.

TopicThe economic problem and resource allocation

Question paper p.14 Mark scheme p.20 Examiner report p.2 Open in the tool Draw it: PPF diagram

Question text is quoted from the question papers, © OCR (Oxford Cambridge and RSA), for students’ private study. Open the official papers and mark schemes from the links on each question. Examiner insights are written with AI assistance and moderated by Finn.

Section A

Section B

Section C

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