UNIVERSITY OF CAMBRIDGE INTERNATIONAL EXAMINATIONS
General Certificate of Education
Advanced Subsidiary Level and Advanced Level
Paper 1 Multiple Choice (Core)
Additional Materials: Multiple Choice Answer Sheet
Soft clean eraser
Soft pencil (type B or HB is recommended)
READ THESE INSTRUCTIONS FIRST
Write in soft pencil.
Do not use staples, paper clips, highlighters, glue or correction fluid.
Write your name, Centre number and candidate number on the answer sheet in the spaces provided unless
this has been done for you.
There are thirty questions on this paper. Answer all questions.
For each question there are four possible answers A, B, C and D. Choose the one you consider correct and
record your choice in soft pencil on the separate answer sheet.
Read the instructions on the answer sheet very carefully.
Each correct answer will score one mark. A mark will not be deducted for a wrong answer.
Any rough working should be done in this booklet.
This document consists of 12 printed pages.
© UCLES 2005
1 What is the main economic problem facing all societies?
A how to reduce unemployment
B how to reduce poverty
C how to allocate scarce resources
D how to control inflation
2 What is the opportunity cost to an unemployed worker who becomes employed?
the leisure they would otherwise have had
the value of the goods and services they produce
the wages they are paid
The diagram illustrates the production possibility curves for an economy in Year 1 (X1, Y1) and
Year 2 (X2, Y2)
What can be deduced from the diagram?
A The cost of production was lower in Year 2 than in Year 1.
B The full employment level of output was lower in Year 2 than in Year 1.
C The o