1 (a) Car production is most likely to take place in which sector of the economy?
(1)
A Primary
B Secondary
C Tertiary
D Mixed

(b) Which one of the following diagrams shows the new equilibrium price and quantity for lemon ice cream in Thailand following a price reduction in chocolate ice cream?
(1)
A B

C
D

(c) What is meant by the term total revenue?
(2)
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(d) State one possible cause of positive economic growth.
(1)
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(e) Define the term external benefit.
(1)

Tour guides are available to accompany tourists who visit the Terracotta Army
collection of sculptures in Xi'An, China. The quantity of tour guides demanded for the first three months of 2019 is shown below.

(f) Calculate the excess supply of tour guides if the quantity supplied during this three-month period was 6,000 ( 2,000 per month). You are advised to show
your working.
(2)
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(g) Using the diagram below, draw the likely effects of an increase in the birth rate on the market for toys. Label the new curve, the new equilibrium price and the new equilibrium quantity.
(3)

Virgin Atlantic took over a part of budget airline Flybe in the spring of 2019 to form
Connect Airways.
(h) Explain one possible advantage for customers of Connect Airways from the takeover.
(3)
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A powerful typhoon destroyed property on the island of Lamma in Hong Kong.
Owners of restaurants that were damaged think it may take two or three months
for them to fully reopen. This was due to flood damage and replacing equipment
that was washed away. The repair costs for one restaurant owner was an estimated
HK\$300 000 to HK\$400 000.
(i) With reference to the data above and your knowledge of economics, analyse how
natural factors such as adverse weather may cause a shift in the supply curve.
(6)
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Define the term external benefit. (1)

Answer:

Knowledge points:

Solution:

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