IGCSE Economics Paper-1: Specimen Questions with Answers 31 - 32 of 64

Question 31

Question

MCQ▾

The rate of increase in population is calculated by;

Choices

Choice (4)

a.

b.

CBR-CDR

c.

d.

Answer

b.

Explanation

  • The rate of natural increase (RNI) is calculated by subtracting the crude death rate from the crude birth rate of a given area. This rate gives the demographers an idea of how the country is growing but it does not include immigration and emigration. RNI helps in predicting a country՚s economic stability, development, etc.
  • The rate of natural increase of human population is calculated by dividing the natural increase by 10. For example, if the birth rate is 12 per 1,000 population, and the death rate is 10 per 1000 population, then the natural increase

Question 32

Question

MCQ▾

Fixed costs include:

1. Salary of staff

2. Depreciation of fixed capital

3. Energy cost of manufacturing

4. Lighting expenditure

Choices

Choice (4)

a.

1,3, 4

b.

2,3, 4

c.

1,2, 4

d.

1,2, 3

Answer

c.

Explanation

  • Fixed cost is the cost, which does not, changes with the change in the production. The cost does not increases with the increase in the level of output. Fixed cost change over the long term when the scale of production increases but as compared to the variable cost, they remain almost same.
  • It is not affected by the business activity. Fixed cost is in the form of expenses that a business has to incur, regardless of business activity. For example, rent is fixed cost i.e.. it has to be incurred even if the production has not started and fixed cost does not increase when sales or production increase.

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