Economics Paper 3


According to the theory of the firm, which of the following statements describes an oligopoly?


Which of the following is not a substitute for carpets?


Which of the following is not a complement to cars?


The demand for fashion goods is not influenced by:


If the price of coffee falls, which one of the following outcomes would be expected to occur?


Consider the price and demand for flower vases. The price of cut flowers goes up sharply. Which of the following would you expect to happen?


Consider the price and demand for tickets to travel by sea ferry. The price of travelling by hovercraft (a substitute form of travel) goes up. Which of the following would you expect to happen?


The summer demand for hotel accommodation in London comes mainly from foreign tourists. Demand for hotel rooms in London in summer could be reduced by a fall in the price or value of which of the following?
1 US dollars
2 Aeroplane tickets
3 Sterling


ABC produces a variety of soft drink. It has two competitors but all three producers use product differentiation to distinguish themselves from each other. What type of market is this?


Suppose that, in a certain advanced industrialised country, the government has applied price controls over rents of both public and private rented accommodation for a number of years, and a serious problem of widespread homelessness has built up. Just recently, the rent price controls have been eased. Which of the following consequences should now occur?
1 An increase in homelessness
2 In the longer term, an increase in new building work
3 The provision of more rented accommodation
4 Fewer owner-occupied dwellings


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