5 marks
Case study · Mozambique
With reference to Extract D line 21, explain why ‘opportunity cost’ is a problem for governments of developing countries when servicing debt.
Specification point 1.1.3 · Theme 1
The economic problem
Nature of economics · Introduction to markets and market failure
Questions tagged to this specification point
12 questions
Essay questions
Long-form evaluation and discussion
No essay questions tagged to this point yet.
Data-response questions
Questions built around exam extracts
5 marks
Case study · Health provision
With reference to Extract A and Figure 2, explain how the health care market in the UK illustrates the economic problem.
4 marks
Case study · Energy markets
Using examples from the information provided, explain what is meant by renewable and non-renewable energy.
Short-answer questions
Focused calculations, explanations and diagrams
3 marks
Using an example from your own knowledge, explain the distinction between renewable and non-renewable resources.
3 marks
ContextScarcity of non-renewable resources, such as oil, is a key reason why alternative resources have been developed by economies. In recent years, within the energy market there has been a large increase in the production of wind power.
With reference to the information provided, explain the distinction between renewable and non-renewable resources.
3 marks
ContextStatement 1: Finland has schools with an average class size of 19.6. Statement 2: Other countries ought to set school class sizes similar to Finland.
With reference to the information above, explain what is meant by ‘opportunity cost’.
2 marks
ContextThe production possibility frontier shows last year’s harvest for a UK farmer at point X. Wheat …
Calculate the opportunity cost of the decision by the farmer to harvest 6 units of wheat this year at point Y (movement from point X to point Y).
Learn this question
Open a video explanation without leaving the question.
3 marks
ContextThe ‘Energy Company Obligation’ is the government’s term for its programme to make houses in the UK more energy efficient.
Explain an opportunity cost to the government of granting subsidies to energy suppliers to install loft insulation.
2 marks
ContextThe diagram refers to production possibility frontiers for a country that produces capital goods and consumer goods. X 100 Output of capital goods …
Calculate the original and the new opportunity cost of producing 50 capital goods. You are advised to show your working.
3 marks
ContextThe production possibility frontier for an economy is shown in the table below. Capital goods output Consumer goods output Opportunity cost (million units) (million units)
Explain, using marginal analysis from the table above, the concept of opportunity cost. (You may use the last column in answering the question.)
Multiple-choice questions
Quick checks of economic understanding
AS Paper 1, June 2025, Q1(a)Multiple choice
1 mark
Spending on capital goods in the UK rose by 4.8% in Quarter 4, 2022. Which one of the following is an example of a capital good?
AA computer
BSavings in the bank
CShares in a company
DUnderground reserves of oil
AS Paper 1, June 2024, Q1(b)Multiple choice
1 mark
ContextScarcity of non-renewable resources, such as oil, is a key reason why alternative resources have been developed by economies. In recent years, within the energy market there has been a large increase in the production of wind power.
Which one of the following best describes ‘scarcity’?
AAn extension of the demand curve
BExcess supply
CInsufficient resources to satisfy wants
DThe misallocation of resources
Question text © Pearson Edexcel, quoted for students' private study. Open the official papers and mark schemes from the links on each question.