Level 1 Economics, 2013
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1 L _j SUPERVSOR'S USE ONLY Level 1 Economics, Demonstrate understanding of consumer choices, using scarcity and or demand 9.30 am Tuesday 26 November 2013 Credits: Four Achievement Demonstrate understanding of consumer choices, using scarcity and/or demand. Achievement with Merit Demonstrate in-depth understanding of consumer choices, using scarcity and/or demand. Achievement with Excellence Demonstrate comprehensive understanding of consumer choices, using scarcity and/or demand. Check that the National Student Number (NSN) on your admission slip is the same as the number at the top of this page. You should attempt ALL the questions in this booklet. f you need more space for any answer, use the page(s) provided at the back of this booklet and clearly number the question. Check that this booklet has pages 2-11 in the correct order and that none of these pages is blank. YOU MUST HAND THS BOOKLET TO THE SUPERVSOR AT THE END OF THE EXAMNATON. Excellence TOTAL 31 ASSESSOR'S USE ONLY New Zealand Qualifications Authority, All rights reserved. No part of this publication may be reproduced by any means without the prior permission of the New Zealand Qualifications Authority.
2 You are advised to spend one hour answering the questions in this booklet. 2 QUESTON ONE: CONSUMER CHOCE Taylor is a 16-year-old student who sings in the school choir and plays football. When she is not rehearsing or training, she helps her parents in the family business. To relax in her spare time, Taylor enjoys having friends around to play computer games. Complete (a) and (b) to fully explain how scarcity and values affect Taylor's consumer choice. (a) Discuss how Taylor's decisions about her use of time and money will involve an opportunity cost. n your answer, you should refer to the resource material above, and link the following: wants limited means scarcity opportunity cost..sc.orci, re~imited meqm relal-ive b Qnlila2ited (,()anh.. )!rh1w JrJ&allS..ls_whm ~q_~jatt~q:esouvr~f---. ~~\sc;x:e<:\eswe> t\,ctf' ct..e n* v-ece=1 ;6--su"'il""''.. 1 c~. 2kiJL,~Vl1Qlli) n lbi-s-ill~ T(for 6os livb\k$ ~ a: ~\1oC\:)_ ; ~~ _j~ox-hhiob :hsl,p-'ltkdtoir, f~ b~ 7_help her ~ ~-~ -~~es_~0 ~tik~.s c Hvwew-v [...,... ~-~ g~<&dj~ 2\.\ houvt jl'\ Q d~ o=rr,rec.n '~- ~-'~ J~~ bqv to ~\~\ a.~a~ts.j-~+c h~3 ~ ~- ~-lliru~~jtjhlu3 Lo c±i vi+les \'f 9-;t~~~CQJ!l'l~kr ' vp 1:;:""s~ ' ~ ely), ad 1-.lpl'ht he.-l""'"'fs ;, 11-o 3. ~ 'DA hl)eg; l6 ~on\~ ~ h eawj ivcofflaf'. R?awse SkY& ~~nk-11-1thd~~dy W\alz~ _ -~1-~ M_ake_o_c~ice_gh~~: -She We>t.t\J_\Mt>Sl= hru~ k GtLBL \n YlORlno-+6~,\ she ~. ~b~i!-_lk_5~ezl~c2n-sb_~jdejjjaj --=-2 ~)s_js lli 0ff??~ cos\- c~~=:bcl a1bl11cl\ille_j - ~ 1ov exo,_m~\e._l::.~~qlc~:;?s ~ s " be tb~~~.q_.l,~~l _{Qrn~~~~~_kip-'.kirY)~busJ.kl "f>l,s~s,_:ijj~{q:):ilrdt)j',wj cos\--= 1s kv ~\fllw ~!mss ~vd GCPv'\lV)~.-=:,,.l\Q~~~k-dee~Jes ~ help 1 f'l the, 1u~a_ llh,<e}ujr \Ae- eo.vvts.o,v\ \\1\COV~Ae/ t\qy e;, po"\-u"r eo~~~,; Rlcr'vtt- C~Y\tl?lt\e'< ~\.Ar...e.S. ct'vlcl Economics 90983,2013 Q'-.1\ \() ~V),
3 3 Taylor's parents want Taylor to do extra shifts in the family business and spend more time on homework, rather than playing computer games with her friends. AS!:lESSOR'S USE ONLY (b) Discuss how Taylor's values may differ from that of her parents. n your answer, you should explain: ONE value Taylor may hold when she decides to have friends around to play computer games ONE value Taylor's parents may hold when they want Taylor to spend more time working in the family business and doing homework how Taylor's values could conflict with those of her parents
4 4 QUESTON TWO: LAW OF DEMAND Taylor uses income earned from working in her parents' business to buy computer games. The following graph shows Taylor's annual demand for computer games. ASSESs o USEONL ( Complete (a)- (c) to fully explain the Jaw of demand in the context of Taylor's demand for computer games. (a) Using the demand curve provided below, complete Taylor's annual demand schedule for computer games. Price ($) Taylor's annual demand for computer games 120 \ 0 ~ "'-... ~ 2& 'fgh ~ ~ D Quantity (games) Taylor's annual demand schedule for computer games Price($) Quantity (games) 4D!7 Go '3 go 5 \C:O "3 l1o 7. (b) On the graph above, show the effect on the quantity of computer games demanded, if the price per game falls from $100 to $60. Fully label all changes. Economics 90983, 2013
5 5 lsor~; ONLYi (c) Discuss the law of demand by referring to Taylor's demand for computer games. ASSESSOR'S USE ONLY j i f
6 6 QUESTON THREE: CHANGES N DEMAND ASSES SO USE ON,~ nstead of computer games, Taylor sometimes spends her income on football magazines, which she reads to help with her training. Complete (a)- (b) to fully explain the economic relationship between football magazines and computer games in the context of Taylor's demand. (a) On the graph below, show how the reduced price of computer games may affect Taylor's demand for football magazines. Price ($) Taylor's demand for football magazines OK D ~ Quantity (magazines) Economics 90983, 2013
7 7 l 1, J ~ l j (b) Discuss how the reduced price of computer games might affect Taylor's demand for football magazines. n your answer: ASSESSOR'S USE ONLY
8 8 QUESTON FOUR: NCOME CHANGES ASSESSOR'S USE ONLY Taylor mainly uses her skipping rope to help with her football training, and she occasionally pays for fitness sessions at a gym. Taylor's parents have increased the income she earns from working in the family business. Complete (a)- (b) to fully explain inferior and luxury goods in the context of Taylor's demand for gym sessions.. (a) Complete the sketch graph below to show the effect a rise in income would have on Taylor's demand for gym sessions. Price ($) Taylor's demand for gym sessions D Q Gh Quantity (sessions) Economics 90983, 2013
9
10 10 QUESTON NUMBER Extra space if required. Write the question number(s) if applicable ASSESSOR'S USEONL.Y -~-- ~ ~~~ ~-~ ~--~-~ ~ ~----~ ----~ ~ ~-~- -~ --~-~~ -~--~ --- -~---~ ~ ~~~ - -~ ~------~--~--~-- ---~ ~------~~----~ ~~-~-- -~--~~---~---~~---~ ~ Economics 90983, 2013
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