(5.) Economics Hl. Paper 2, Techniques.

10 Questions | By IBLindman | Updated: Mar 16, 2022 | Attempts: 140

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The economics paper two is one that students have come to fear more as they have the idea that it is harder than the first. To help you be calmer and get rid of the pre exam jitters making their way to you, we have prepared the quiz below. Give it a try.

Questions and Answers

1.

You have 60 minutes to write your paper 2. How do you use your time?
- A.
  
  You select three questions and give them 20 minutes each
- B.
  
  You select one question and answer it very thoroughly
- C.
  
  You select two questions and spend 40 minutes on one and 20 minutes on the other one
2.

Consider this question: "Explain what is meant by a production possibility curve and use a production possibility curve diagram to explain the concepts of scarcity, choice and opportunity cost" If you draw a perfect production possibility curve and explain it well, but do not explain the concepts of scarcity, choice and opportunity cost, how many points do you get?
- A.
  
  2/10
- B.
  
  3/10
- C.
  
  4/10
- D.
  
  5/10
3.

Consider the same question: "Explain what is meant by a production possibility curve and use a production possibility curve diagram to explain the concepts of scarcity, choice and opportunity cost" When illustrating "choice", which point on the diagram should be used?
- A.
  
  A point outside the curve
- B.
  
  A point inside the curve
- C.
  
  A point along the curve
- D.
  
  A point outside the diagram
4.

Consider the same question: "Explain what is meant by a production possibility curve and use a production possibility curve diagram to explain the concepts of scarcity, choice and opportunity cost" Does making a choice to move from a point inside the PPF curve to the actual curve involve opportunity costs?
- A.
  
  Yes
- B.
  
  No
- C.
  
  Yo
5.

Consider this question: "A concert is held in a stadium with limited seating capacity. The organizers set the ticket prices at a level below the equilibrium price. Using a diagram, explain the possible consequences of their decision." What would earn full marks?
- A.
  
  Accurate diagram and explanation of equilibrium price
- B.
  
  Accurate diagram and explanation of equilibrium price + detailed discussion of one consequence
- C.
  
  Accurate diagram and explanation of equilibrium price + detailed discussion of two consequences
- D.
  
  Accurate diagram and explanation of equilibrium price + less detailed discussion of two consequences
6.

Consider this question: "A government decides to raise personal income tax rates. Using diagrams, explain one possible demand-side consequence and one possible supply-side consequence of this decision" For this question, the definitions alone account for 3/10 marks. Which definitions?
- A.
  
  Income tax, demand-side consequence and supply-side consequence
- B.
  
  Income tax, aggregate demand and aggregate supply
- C.
  
  Income tax
7.

Consider this question: "Explain why a depreciation of a country's exchange rate may not always lead to an improvement in its current account of the balance of payments" There are many keywords in this question: depreciation, exchange rate, current account (of balance of payments). How many points have you secured if you define them all to start with?
- A.
  
  2 points
- B.
  
  3 points
- C.
  
  4 points
8.

Consider the same question: "Explain why a depreciation of a country's exchange rate may not always lead to an improvement in its current account of the balance of payments" This question suggests that there is a condition for the improvement of the current account to take place after the depreciation. The condition is known as the "Marshall-[...] condition"
9.

Consider the same question: "Explain why a depreciation of a country's exchange rate may not always lead to an improvement in its current account of the balance of payments" Given that the Marshall-Lerner condition is satisfied, the improvement will still not be immediate due to the fact that it takes time to change. Write down the letter that signifies this time-effect.
10.

Assume you forget to mention both the J-curve effect and the Marshall-Lerner condition and fluff about other stuff, how many marks can you earn?
- A.
  
  6 marks
- B.
  
  7 marks
- C.
  
  8 marks