Errors

Question 1

What is advantage of a market economy in the allocation of resources?

Answer 1

It guarantees suppliers will make a profit.

Question 2

What will occur when there is a conglomerate merger?

Answer 2

reduced technical economies of scale

Question 3

How could a state-owned oil refining firm be classified?

Answer 3

as a public sector firm in the secondary sector

• Primary sector: this involves the use/extraction of natural resources. Examples include agricultural activities, mining, fishing, wood-cutting, oil drilling etc.
• Secondary sector: this involves the manufacture of goods using the resources from the primary sector. Examples include auto-mobile manufacturing, steel industries, cloth production etc.
• Tertiary sector: this consist of all the services provided in an economy. This includes hotels, travel agencies, hair salons, banks etc.

Question 4

The table provides information about a country’s labour market.
* population size - 2,000,000
* Labour fore size - 1,200,000
* number of employed - 900,000
* number of full-time students - 100,000
What is the unemployment rate of this country?

Answer 4

25%

Unemployment rate = No. people unemployment / Total No. people in labour force

（1200000-900000）/ 1200000 = 25%