联系我们： 手动添加方式: 微信>添加朋友>企业微信联系人>13262280223 或者 QQ: 1483266981

Module Code
ECO00023C
BA, BSc Degree Examinations 2024-5
Department:
Economics
Title of Exam:
ECO00023C Principles of Economics
Time Allowed:
2 hours plus one hour to upload the exam
(PLEASE NOTE: Submissions up to 30 minutes late will receive a 5 mark penalty
deduction. Submissions late by more than 30 minutes, will not be marked.)
Time Recommended:
2 hours plus one hour to upload the exam
Word Limit:
There are word limits specified for the questions in each of the two parts.
● For Part 1 the word limit is 75 words per question.
● For Part 2 the word limit is 200 words per question.
The word count does not include: i) figures and graphs; ii) equations; iii) a
bibliography at the end of the question.
A bibliography is NOT required. In-text references (Author, date) are sufficient but
not needed.
Markers will not read or mark any material beyond the word limits.
Allocation of Marks:
● In Part 1, all questions carry an equal weight: 4 marks for a correct answer (0
for null or incorrect answer) and 4 marks per justification.
● In Part 2, each of the two questions carry an equal weight: 10 marks each.
Instructions for Candidates:
Instructions for PART 1 – Multiple-choice test [80 marks]
● There are 10 questions, labelled from 1 to 10. Answer ALL questions.
● Each question will have a number of possible answers labelled with the letters
‘A’, ‘B’, ‘C’, ‘D’.
● You can only select ONE answer per question.
● For each question you are asked to provide a justification for your answer.
The word limit per justification is 75 words.
● For example, if you select ‘B’, you are expected to justify why you think ‘B’ is
the correct answer.
● A justification by elimination (for example, “it’s not ‘A’, ‘B’ or ‘D’ so it must be
‘B’”) will not be valid.
● You do not have to justify why other answers are incorrect (except if you pick
“None of the above”).
● All questions carry an equal weight: 4 marks for a correct answer (0 for null or
incorrect answer) and 4 marks per justification.
Instructions for PART 2 – Open questions [20 marks]
● There are 2 questions, labelled a) and b). Answer both questions.
● The word limit per question is 200 words. It does not include diagrams and
equations.
● Both questions carry an equal weight: 10 marks each.
Any answers you do not wish to be included in the marking must be clearly crossed
out.
Page 2 of 10
A note on Academic Integrity
We are treating this online examination as a time-limited open assessment. You are
therefore permitted to refer to written, and online materials, to aid you in your answers.
However, you must ensure that the work you submit is entirely your own, and for the whole
time the assessment is live you must not:
● communicate with departmental staff on the topic of the assessment
● communicate with other students on the topic of this assessment
● seek assistance with the assignment from the academic and/or disability support
services, such as the Writing and Language Skills Centre, Maths Skills Centre and/or
Disability Services. (The only exception to this will be for those students who have
been recommended an exam support worker in a Student Support Plan. If this
applies to you, you are advised to contact Disability Services as soon as possible to
discuss the necessary arrangements)
● seek advice or contribution from any third party, including proofreaders, friends, or
family members.
We expect, and trust, that all our students will seek to maintain the integrity of the
assessment, and of their award, by ensuring that these instructions are strictly followed.
Failure to adhere to these requirements will be considered a breach of the Academic
Misconduct regulations, where the offences of plagiarism, breach/cheating, collusion and
commissioning are relevant – see AM.1.2.1” (Note this supersedes section 7.3 of the Guide
to Assessment).
Finally, by submitting your work, you are agreeing to the following statements:
I consent to my assignment being submitted for checking against Turnitin’s database, to
ensure my work is original.
I declare that this assessment is a presentation of original work, I am the sole author and I
am not attempting to pass off work created by generative AI content tools as my own.
I understand that:
● My work may be compared with existing texts within Turnitin’s database
● My work will not be released to any other institution
● My personal data is protected by the Data Protection Act/GDPR
● The University of York may retain a copy of my work in case of appeal
● All copyright and Intellectual Property Rights associated with my assignment will
remain my own
Page 3 of 10
PART 1 – Multiple-choice test [80 marks]
1. Consider a simultaneous move game with two players: Amy and John. Amy has two options
available, UP and DOWN, and John has two options as well, LEFT and RIGHT. The game is
represented in strategic form in Table 1 below. Amy is the row player and John the column
player. The payoffs for Amy are presented at the bottom-left of each cell and are shaded in
blue. John’s payoffs are presented at the top-right of each cell and are shaded in red.
Table 1. Game in strategic form
Which of the statements below is correct
A. There are two Nash Equilibria in this game, one equilibrium is when Amy chooses UP
and John chooses LEFT, in the other one Amy chooses DOWN and John chooses
LEFT.
B. There is only one Nash Equilibrium in this game. This equilibrium happens when
Amy chooses DOWN and John chooses LEFT.
C. There is only one Nash Equilibrium in this game. This equilibrium happens when
Amy chooses DOWN and John chooses RIGHT.
D. There is only one Nash Equilibrium in this game. This equilibrium happens when
Amy chooses UP and John chooses RIGHT.
TURN OVER
Page 4 of 10
Page 5 of 10
2. Figure 1 below shows two indifference curves (ICA and ICB) and 3 budget lines (BLA
, BLB
, and
BLC
) for two goods: X1 and X2. The initial situation is indicated at point A, where BLA and ICA
touch, the final situation is indicated at point B, where BLB and ICB touch.
Figure 1. Indifference curves and budget constraint.
Which of the statements below is correct
A. The income effect causes an increase in the consumption of 1 from 1

to 1

, and a
decrease in the consumption of 2 from 2

to 2

.
B. For good 1 the income and substitution effects reinforce each other, both effects
increasing the consumption of 1. For good 2, the income and substitution effects
go in opposite directions, the substitution effect increases the consumption of good
2 and the income effect decreases the consumption of good 2.
C. For good 1 the income and substitution effects reinforce each other, both effects
increasing the consumption of 1. For good 2, the income and substitution effects
go in opposite directions, the substitution effect decreases the consumption of good
2 and the income effect increases the consumption of good 2.
D. For both goods 1 and 2, the substitution effect increases the consumption of the
goods, while the income effect negatively affects the consumption of 1 and
positively affects the consumption of good 2.
TURN OVER
Page 6 of 10
3. A clothing store currently sells 500 shirts per month at a price of ￡20 each. After a price
increase to ￡22, the quantity demanded drops to 420 shirts. Based on this information,
should the store increase the price further
Select the correct answer from the options below.
A. Yes, the demand is inelastic, and revenue would increase.
B. Yes, the demand is elastic, and revenue would increase.
C. No, the demand is elastic, and revenue would decrease further.
D. No, the demand is inelastic, and revenue would decrease.
4. Alice is deciding whether to attend a five-day conference that runs all days from Thursday
until Monday inclusive. The conference will help her build skills relevant to her career. The
conference costs ￡300, and by attending, she would miss three days of work where she
earns ￡100 per day. Additionally, she values her leisure time on weekends at ￡200 per day.
There are no other costs associated with attending the conference.
Select the correct answer from the options below.
A. She should attend the conference only if, for her, attending the conference has a
value equivalent to at least ￡300.
B. She should attend the conference only if, for her, attending the conference has a
value equivalent to at least ￡600.
C. She should attend the conference only if, for her, attending the conference has a
value equivalent to at least ￡700.
D. She should attend the conference only if, for her, attending the conference has a
value equivalent to at least ￡1000.
TURN OVER
5. Figure 2 shows the isoprofit curve IP1, demand curves D1 and D2, and the marginal cost
curve MC. On the left hand side, Figure 2 a shows the competitive equilibrium outcome at
point c, and the profit maximisation solution for the firm at point d. On the right hand side,
Figure 2 b shows the competitive equilibrium result at point a and at point b the profit
maximisation outcome for the firm.
Figure 2. Isoprofit curve, demand curve, and marginal cost curve.
Select the correct answer from the options below.
A. Demand curve D1 is less elastic than demand curve D2. Thus, the firm can exercise a
higher market power in a market with demand D1, charging a higher price and
offering a lower quantity. This leads to a bigger deadweight loss.
B. Demand curve D1 is more elastic than demand curve D2. Thus, the firm can exercise
a lower market power in a market with demand D1, charging a higher price and
offering a lower quantity. This leads to a bigger deadweight loss.
C. Demand curve D2 is less elastic than demand curve D1. Thus, the firm can exercise a
higher market power in a market with demand D2, charging a higher price and
offering a lower quantity. This leads to a bigger deadweight loss.
D. Demand curve D2 is less elastic than demand curve D1. Thus, the firm can exercise a
higher market power in a market with demand D2, charging a lower price and
offering a higher quantity. This leads to a smaller deadweight loss.
TURN OVER
Page 7 of 10
6. You are given the following information for a country:
Participation rate = 75%, Unemployment rate = 10%, Employment rate = 67.5% and Number
of employed = 27 million.
Based on this information, which of the following is correct
A. The working age population is 30 million.
B. The size of the labour force is 40 million.
C. The number of unemployed is 3 million.
D. The unemployment rate is 12%.
7. Consider the given Lorenz curve associated with a particular supply-side equilibrium. In a
population of 100, there are 10 firms, each with a single owner, 80 employed workers, and
10 unemployed workers. The employed workers receive 60% of the total income as wages.
The Gini coefficient is 0.36. In which of the following cases would the Gini coefficient
decrease, keeping all other factors unchanged
A. An increase in the unemployment rate
B. A fall in the real wage
C. A fall in the workers’ productivity while the real wage is unchanged
D. A fall in the degree of competition faced by the firms
TURN OVER
Page 8 of 10
8. Imagine that the rate of inflation has been 10 per cent per year for a number of years. The
central bank then introduces a ‘tight’ monetary policy and the rate of inflation comes down
to 5 per cent per year. This reduction is an example of:
A. Deflation.
B. Falling prices.
C. Disinflation.
D. Austerity.
9. Which of the following statements regarding inequality in the labour market is likely to be
true
A. Labour market segmentation is likely to reduce earnings inequality.
B. Workers in the primary labour market generally experience worse working conditions than
those in the secondary labour market.
C. Eliminating the division between primary and secondary labour markets should increase the
Gini coefficient.
D. In the secondary labour market, workers are likely to have lower earnings than workers with
the same endowments in the primary labour market.
10. A country’s GDP is being measured by expenditure. Various categories of expenditure are
recorded as follows: Households’ spending on consumption = $100bn, Firms’ spending on
capital goods = $15bn, Firms’ addition to inventories = $1bn, Government spending on
services = $10bn, Government spending on capital goods = $2bn, Government transfers
(social security etc) = $10bn, Exports = $12bn, Imports = $10bn. What is the correct estimate
of GDP
A. $150bn
B. $160bn
C. $139bn
D. $130bn
TURN OVER
Page 9 of 10
Page 10 of 10
PART 2 – Open questions [20]
a) Consider a market where a tax per unit sold has been in place for a long time. The government is
considering removing the tax to benefit households, affirming that removing the tax will have no
benefit for the firms in that market. Analyse how the removal of the tax can increase efficiency.
Discuss if this will benefit households and how. Argue in favour or against the governments
statement that removing the tax will not have an effect on firms. Include graphical analysis in
your answer to show the effect on consumer and producer surplus, government revenue from
tax collection, and the loss in efficiency as shown by the deadweight loss.
b) For each of the following changes, provide a brief explanation of which direction the wage setting curve shifts (upwards/leftwards or downwards/rightwards) and why, referring to the no shirking wage and/or reservation wage:
(i) Decrease in unemployment benefit. (5 marks)
(ii) Decrease in social stigma attached to being unemployed. (5 marks)
END OF EXAM