A-Level Economics H1 Quiz - Policy Evaluation
Name: ___________________________
Class: ___________________________
Date: ___________________________
Score: _______ / 40
Duration: 60 minutes
Total Marks: 40
Topic: Policy Evaluation (policy-evaluation)
Instructions:
- This quiz contains 20 questions across Sections A, B, and C.
- Section A: Data Interpretation (Questions 1–5, 2 marks each)
- Section B: Structured & Source-Based Response (Questions 6–13, mixed marks)
- Section C: Evaluation & Extended Response (Questions 14–20, mixed marks)
- Use diagrams where instructed. Show workings for calculation-based items.
- Answer all questions in the spaces provided.
Section A: Data Interpretation (10 marks)
1. [2 marks] With reference to Table 1, compare the government spending on childcare subsidies in Country A and Country B from 2019 to 2023.
| Year | Country A ($bn) | Country B ($bn) |
|---|
| 2019 | 2.1 | 1.4 |
| 2023 | 4.8 | 3.9 |
2. [2 marks] Describe the trend in the national unemployment rate from 2020 to 2024 using Table 2.
| Year | Unemployment (%) |
|---|
| 2020 | 4.2 |
| 2021 | 3.8 |
| 2022 | 3.1 |
| 2023 | 2.9 |
| 2024 | 2.7 |
3. [2 marks] Using Table 3, compare the real GDP growth rate in Econolia and Boronia from 2021 to 2023.
| Year | Econolia (%) | Boronia (%) |
|---|
| 2021 | 3.5 | 2.1 |
| 2022 | 2.8 | 1.9 |
| 2023 | 1.2 | 0.8 |
4. [2 marks] With reference to Extract 1 below, explain the estimated price elasticity of demand (PED) for public transport after a 10% fare increase led to a 4% drop in riders.
Extract 1: A 10% increase in bus fares caused a 4% decline in passenger numbers.
5. [2 marks] Explain the likely value of price elasticity of supply (PES) for construction of public housing, given that increasing land and approvals take 3–5 years.
Section B: Structured & Source-Based Response (16 marks)
6. [2 marks] Identify two criteria an economist might use to evaluate the success of a subsidy policy aimed at reducing carbon emissions.
7. [3 marks] Using a demand and supply diagram, explain how a subsidy to renewable energy producers can increase equilibrium quantity and reduce market price. [Draw diagram and explain.]
8. [3 marks] With reference to Extract 2, explain why a maximum price on essential rice may lead to a persistent shortage if supply is inelastic.
Extract 2: The government sets a maximum price for rice below the market equilibrium. Local farmers cannot expand output quickly due to land constraints.
9. [2 marks] State one unintended consequence of a tobacco tax designed to reduce smoking among low-income households.
10. [2 marks] Define "deadweight loss" and explain how it relates to policy evaluation of a tax.
11. [2 marks] With reference to Table 4, calculate the change in government budget balance from 2022 to 2023.
| Year | Revenue ($bn) | Expenditure ($bn) |
|---|
| 2022 | 80 | 78 |
| 2023 | 85 | 92 |
12. [2 marks] Explain one reason why a policy that is efficient may not be considered equitable, using the example of a fuel tax.
13. [2 marks] Identify and explain one assumption that must hold for a tradeable permit scheme to effectively reduce pollution.
Section C: Evaluation & Extended Response (14 marks)
14. [7 marks] Discuss whether the standard of living in Country C has improved between 2019 and 2023 using Table 5. Use at least three indicators and recognise limitations of the data.
| Indicator | 2019 | 2023 |
|---|
| Real GDP per capita ($) | 38,000 | 41,500 |
| Unemployment (%) | 4.0 | 2.7 |
| Infant mortality (per 1000) | 3.1 | 2.4 |
| Income inequality (Gini) | 0.42 | 0.45 |
15. [5 marks] Evaluate the effectiveness of a carbon tax in reducing emissions, using the decision-making approach. Consider benefits, costs, and unintended consequences.
16. [4 marks] Using an AD/AS diagram, explain how an expansionary fiscal policy may help reduce unemployment, and evaluate one limitation of this policy.
17. [4 marks] With reference to Extract 3, evaluate whether direct provision of broadband by the government is more effective than subsidising private firms.
Extract 3: Country D provided free broadband in rural areas directly, while Country E gave subsidies to private firms. Country D achieved 95% coverage in 2 years; Country E reached 70% in 4 years at higher cost.
18. [3 marks] Explain how the marginalist principle can be used to evaluate whether a proposed infrastructure project should proceed.
19. [3 marks] Evaluate the view that "policy should always target equity over efficiency". Use one microeconomic policy example.
20. [2 marks] State two limitations of using real GDP per capita alone to evaluate policy success.
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<stage3_quiz_answers_md>
A-Level Economics H1 Quiz - Policy Evaluation: Answer Key
Total Marks: 40
Topic: Policy Evaluation
Section A: Data Interpretation (10 marks)
Q1 [2 marks]
- Both countries increased spending (A: 2.1→4.8; B: 1.4→3.9). [1]
- Country A rose more than double; Country B increased but remained lower. [1]
Marking: 1 for both values compared, 1 for comparative language.
Q2 [2 marks]
- Unemployment fell from 4.2% to 2.7% over the period. [1]
- Decline was steady and accelerating slightly after 2021. [1]
Common mistake: stating only direction without referencing years.
Q3 [2 marks]
- Both countries experienced declining growth; Econolia higher than Boronia each year. [1]
- Econolia fell from 3.5% to 1.2%; Boronia from 2.1% to 0.8%. [1]
Q4 [2 marks]
- PED = %ΔQd / %ΔP = (-4%) / (+10%) = -0.4 → |PED| = 0.4. [1]
- Inelastic (|PED|<1): demand weakly responsive; users are captive. [1]
Q5 [2 marks]
- PES likely low (<1) in short run. [1]
- Reason: long delays in land/approvals restrict quick supply response. [1]
Section B: Structured & Source-Based (16 marks)
Q6 [2 marks]
- Emission reduction achieved vs target. [1]
- Cost to government / fiscal sustainability. [1]
Q7 [3 marks]
- Diagram: S shifts right (subsidy), P falls, Q rises. [1]
- Explanation: subsidy lowers producer cost, increases supply. [1]
- New equilibrium: lower price, higher quantity. [1]
Q8 [3 marks]
- Max price below Eq → excess demand. [1]
- Inelastic supply → quantity supplied unresponsive. [1]
- Shortage persists as Qs cannot rise quickly. [1]
Q9 [2 marks]
- E.g., black market emergence; regressive burden on poor. [2 if valid, 1 if partial]
Q10 [2 marks]
- DWL = loss of total surplus from over/under production. [1]
- Tax creates DWL; evaluator compares DWL vs revenue. [1]
Q11 [2 marks]
- 2022 balance = 80–78 = +2; 2023 = 85–92 = -7. [1]
- Change = -7 – (+2) = -9 ($bn worsening). [1]
Q12 [2 marks]
- Fuel tax efficient (cuts emissions) but hits low-income hardest. [1]
- Equity issue: disproportionate burden. [1]
Q13 [2 marks]
- Assumption: property rights enforceable / monitoring possible. [1]
- Else permits ineffective. [1]
Section C: Evaluation & Extended (14 marks)
Q14 [7 marks]
- Real GDP pc ↑ (better material living). [1]
- Unemployment ↓ (more jobs). [1]
- Infant mortality ↓ (health improved). [1]
- But Gini ↑ (wider inequality). [1]
- Limitation: GDP ignores distribution; Gini worsened. [1]
- Conclusion: mixed; avg living up but equity fell. [1]
- Eval: data lacks environmental/social factors. [1]
Q15 [5 marks]
- Benefits: incentivises reduction, revenue. [1]
- Costs: compliance, regressive. [1]
- Unintended: firms relocate (carbon leakage). [1]
- Decision approach: weigh MB vs MC. [1]
- Judgement: effective if rate set right + recycled. [1]
Q16 [4 marks]
- AD↑ → real output ↑ → unemployment ↓. [1]
- Diagram shows AD right. [1]
- Limitation: inflation if near full capacity. [1]
- Eval: time lag / crowding out. [1]
Q17 [4 marks]
- D direct faster coverage. [1]
- E subsidy slower, costlier. [1]
- Eval: D may lack competition; E preserves market. [1]
- Conclusion: depends on geography/cost. [1]
Q18 [3 marks]
- Compare MB vs MC at margin. [1]
- Proceed if MB ≥ MC. [1]
- Applied to project scale. [1]
Q19 [3 marks]
- Example: subsidy (equity) may cause DWL (efficiency loss). [1]
- Not always: extreme inequality harms growth. [1]
- Judgement: balance needed. [1]
Q20 [2 marks]
- Ignores distribution (Gini). [1]
- Ignores non-market factors (health, leisure). [1]
</stage3_quiz_answers_md>
<stage3_quiz_md>
A-Level Economics H1 Quiz - Policy Evaluation
Name: ___________________________
Class: ___________________________
Date: ___________________________
Score: _______ / 40
Duration: 60 minutes
Total Marks: 40
Topic: Policy Evaluation (policy-evaluation)
Instructions:
- This quiz contains 20 questions across Sections A, B, and C.
- Section A: Data Interpretation (Questions 1–5, 2 marks each)
- Section B: Structured & Source-Based Response (Questions 6–13, mixed marks)
- Section C: Evaluation & Extended Response (Questions 14–20, mixed marks)
- Use diagrams where instructed. Show workings for calculation-based items.
- Answer all questions in the spaces provided.
Section A: Data Interpretation (10 marks)
1. [2 marks] With reference to Table 1, compare the government spending on childcare subsidies in Country A and Country B from 2019 to 2023.
| Year | Country A ($bn) | Country B ($bn) |
|---|
| 2019 | 2.1 | 1.4 |
| 2023 | 4.8 | 3.9 |
2. [2 marks] Describe the trend in the national unemployment rate from 2020 to 2024 using Table 2.
| Year | Unemployment (%) |
|---|
| 2020 | 4.2 |
| 2021 | 3.8 |
| 2022 | 3.1 |
| 2023 | 2.9 |
| 2024 | 2.7 |
3. [2 marks] Using Table 3, compare the real GDP growth rate in Econolia and Boronia from 2021 to 2023.
| Year | Econolia (%) | Boronia (%) |
|---|
| 2021 | 3.5 | 2.1 |
| 2022 | 2.8 | 1.9 |
| 2023 | 1.2 | 0.8 |
4. [2 marks] With reference to Extract 1 below, explain the estimated price elasticity of demand (PED) for public transport after a 10% fare increase led to a 4% drop in riders.
Extract 1: A 10% increase in bus fares caused a 4% decline in passenger numbers.
5. [2 marks] Explain the likely value of price elasticity of supply (PES) for construction of public housing, given that increasing land and approvals take 3–5 years.
Section B: Structured & Source-Based Response (16 marks)
6. [2 marks] Identify two criteria an economist might use to evaluate the success of a subsidy policy aimed at reducing carbon emissions.
7. [3 marks] Using a demand and supply diagram, explain how a subsidy to renewable energy producers can increase equilibrium quantity and reduce market price. [Draw diagram and explain.]
8. [3 marks] With reference to Extract 2, explain why a maximum price on essential rice may lead to a persistent shortage if supply is inelastic.
Extract 2: The government sets a maximum price for rice below the market equilibrium. Local farmers cannot expand output quickly due to land constraints.
9. [2 marks] State one unintended consequence of a tobacco tax designed to reduce smoking among low-income households.
10. [2 marks] Define "deadweight loss" and explain how it relates to policy evaluation of a tax.
11. [2 marks] With reference to Table 4, calculate the change in government budget balance from 2022 to 2023.
| Year | Revenue ($bn) | Expenditure ($bn) |
|---|
| 2022 | 80 | 78 |
| 2023 | 85 | 92 |
12. [2 marks] Explain one reason why a policy that is efficient may not be considered equitable, using the example of a fuel tax.
13. [2 marks] Identify and explain one assumption that must hold for a tradeable permit scheme to effectively reduce pollution.
Section C: Evaluation & Extended Response (14 marks)
14. [7 marks] Discuss whether the standard of living in Country C has improved between 2019 and 2023 using Table 5. Use at least three indicators and recognise limitations of the data.
| Indicator | 2019 | 2023 |
|---|
| Real GDP per capita ($) | 38,000 | 41,500 |
| Unemployment (%) | 4.0 | 2.7 |
| Infant mortality (per 1000) | 3.1 | 2.4 |
| Income inequality (Gini) | 0.42 | 0.45 |
15. [5 marks] Evaluate the effectiveness of a carbon tax in reducing emissions, using the decision-making approach. Consider benefits, costs, and unintended consequences.
16. [4 marks] Using an AD/AS diagram, explain how an expansionary fiscal policy may help reduce unemployment, and evaluate one limitation of this policy.
17. [4 marks] With reference to Extract 3, evaluate whether direct provision of broadband by the government is more effective than subsidising private firms.
Extract 3: Country D provided free broadband in rural areas directly, while Country E gave subsidies to private firms. Country D achieved 95% coverage in 2 years; Country E reached 70% in 4 years at higher cost.
18. [3 marks] Explain how the marginalist principle can be used to evaluate whether a proposed infrastructure project should proceed.
19. [3 marks] Evaluate the view that "policy should always target equity over efficiency". Use one microeconomic policy example.
20. [2 marks] State two limitations of using real GDP per capita alone to evaluate policy success.