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1.4 Production, costs and revenue

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Question 5

In a highly developed economy characterized by a complex division of labour, money’s function as a medium of exchange is fundamental because it...

A

provides a common standard to compare the relative prices of highly specialised goods and services.

B

guarantees that the purchasing power of specialised producers is preserved over long periods of deferred payment.

C

obviates the requirement for a double coincidence of wants, enabling individuals to trade their specialised output efficiently.

D

directly increases the productive capacity of the economy, shifting the production possibility frontier outwards.

Markscheme

1.4 Production, costs and revenue Questions

  1. A Level
  2. /Economics
  3. /1.4 Production, costs and revenue

156 exam-style questions on AQA A Level Economics 1.4 Production, costs and revenue, covering 1.4.1 Production and productivity, 1.4.2 Specialisation, division of labour and exchange, 1.4.3 The law of diminishing returns and returns to scale (A-level only), 1.4.4 Costs of production, 1.4.5 Economies and diseconomies of scale, 1.4.6 Marginal, average and total revenue, 1.4.7 Profit, and 1.4.8 Technological change (A-level only). Each one has a worked solution and a mark scheme showing where the marks go.

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