CIE IGCSE Topical Past Paper 2

3.6 Firms and production

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0455/22/F/M/23

In 2019 India became the world’s largest  producer of sugar. Sugar cane is grown in the country by a large number of mainly low-income farmers. They sell sugar cane to mills which process the sugar cane into sugar. Processing the sugar cane is more capital intensive than growing it. The Indian government sets a minimum price for sugar cane and subsidises the export of sugar.

b) Explain two advantages of capital intensive production.  [4]

0455/22/F/M/23

Safiye Ali  became the first  female doctor in Turkey in 1923. By 2020, 40% of Turkish doctors were women. Over this period, labour productivity increased. Turkey also experience advances in technology, a change in the current account balance on its balance of payments  and a significant increase in the size of population.

a) Identify two causes of an increase in labour productivity. [2]

0455/23/M/J/21 

Cyclical unemployment is below the national average in some big cities in Canada such as Toronto, Vancouver, and Montreal. This could be a result of higher government spending and tax cuts in big cities. However, productivity is low. There are also concerns that structural unemployment may increase as some industries cannot compete with more efficient foreign firms. 

b) Explain two causes of low productivity. [4] 

0455/22/M/J/21 

Consumers in Uruguay are eating more processed foods. Factors of production, including enterprise, have responded to this change. Firms in the processed food industry have become more capital-intensive. All of Uruguay’s industries were affected by the rise in its inflation rate, from 6.2% in 2017 to 7.7% in 2018. 

c) Analyse why a firm may become more capital-intensive. [6] 

0455/21/M/J/21 

In 2018, the US had its lowest unemployment rate for 18 years. Cyclical unemployment was very low and so was the rate of inflation. The US also experienced a rise in labour productivity. However, it did not do so well in reducing poverty. In 2018, approximately 12% of Americans were living in poverty. 

b) Explain two ways a firm could increase the productivity of its workers. [4]