I/GCSE Economics Question Analysis Topic: Economics - Short Questions
Exam Questions:
1) Rising unemployment is one of the phenomena which occurs during economic recession.
(a) State TWO losses to society caused by unemployment.
(b) Other than rising unemployment, give TWO other economic phenomena which would occur during economic recession.
2) "9999 gold is preferred to cigarettes when used as money." Give TWO reasons to explain this argument.
Answer:
For I/GCSE Economics, you should know:
1)
(a)
Unemployment causes many losses to society. For instance, the loss of output as well as the loss of human capital. Another acceptable answer is the rise of politico-social unrest.
(b)
Two economic phenomena that might occur would be a falling / negative real GDP growth and a low / falling inflation or even deflation. Other acceptable answers would be falling business confidence, levels of investment and consumption.
2) There are many reasons as to why 9999 gold is preferred as currency. Namely, gold is more durable than cigarettes, which may lose value during transaction. Besides, it's a more generally accepted medium of exchange. Another relevant point to include is that gold is more homogenous, while cigarettes may differ in quality.
Work hard for your I/GCSE Economics examination!
End of analysis. Great!
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