Eco paper 1 - doubt!

[Rashmit Arora]

I'll begin with a doubt i'm having.

The table shows the price indices and weights for three commodity groups that are included in
the calculation of a country's consumer price index.
commodity group index weight
X 400 5
Y 120 3
Z 80 2
By how much has the cost of living increased since the base year?
A 52 % B 60 % C 152 % D 520 %


How do you go about such a question?

 

[student92]

hi there, i beleive you are new here, it would be better if you posted the link of the question paper insted of pasting it, the table is really jumbled up and hard to understand
nevermind, please see my attachment, hopfully you will understand how to solve this question.

 

[Rashmit Arora]

View attachment 9334
hi there, i beleive you are new here, it would be better if you posted the link of the question paper insted of pasting it, the table is really jumbled up and hard to understand
nevermind, please see my attachment, hopfully you will understand how to solve this question.

Thanks! And yeah, I was in a rush whilst posting this thread so didn't care to recheck the post. Thanks anyway, I'd made a calculation error previously!

 

[student92]

your welcome

 

[fishfish]

http://papers.xtremepapers.com/CIE/... AS Level/Economics (9708)/9708_s12_qp_13.pdf
question 9 pplease

 

[Rashmit Arora]

http://papers.xtremepapers.com/CIE/Cambridge International A and AS Level/Economics (9708)/9708_s12_qp_13.pdf
question 9 pplease

% Change in the price of tractors = 10%
% Change in Quantity Supplied by X = 10%

Therefore, PES of X is 10% / 10% = 1

% Change in the price of tractors = 10%
% Change in Quantity Supplied by Y = 20%
Therefore, PES of Y is 20% / 10% = 2
Now, because both of them have an equal share of the market, i.e. 50% each, you need to add the two elasticity values and divide them by 2.
ANS = (1 + 2)/2
= 1.5 (option B)
Cheers!

 

[pakiboy]

View attachment 9334
hi there, i beleive you are new here, it would be better if you posted the link of the question paper insted of pasting it, the table is really jumbled up and hard to understand
nevermind, please see my attachment, hopfully you will understand how to solve this question.

wont the ans be 52 since it was hundred in base year? :O

 

[fishfish]

% Change in the price of tractors = 10%
% Change in Quantity Supplied by X = 10%

Therefore, PES of X is 10% / 10% = 1

% Change in the price of tractors = 10%
% Change in Quantity Supplied by Y = 20%
Therefore, PES of Y is 20% / 10% = 2
Now, because both of them have an equal share of the market, i.e. 50% each, you need to add the two elasticity values and divide them by 2.
ANS = (1 + 2)/2
= 1.5 (option B)
Cheers!

thankyouu

 

[fishfish]

http://papers.xtremepapers.com/CIE/... AS Level/Economics (9708)/9708_s11_qp_11.pdf
ques 11
ques 21

 

[student92]

http://papers.xtremepapers.com/CIE/Cambridge International A and AS Level/Economics (9708)/9708_s11_qp_11.pdf
ques 11
ques 21

21 its b
we know the formula for terms of trade is index of export prices/ index of import prices into 100
so the question tells us the TOT IS 150, and the export prices have risen by 20%, therefore this means that the index of export prices is 120

now all we have to do is find the correct index of imports which gives us an TOT of 150
so, try each key until you get a tot of 150
using b, 120/(100-20) X100 =150
this mateches the tot given in the question, thereofe there must be a -20% fall in avergare prices of imports

 

[student92]

http://papers.xtremepapers.com/CIE/Cambridge International A and AS Level/Economics (9708)/9708_s11_qp_11.pdf
ques 11
ques 21

Economics: Post your doubts here (O + A level)