IGCSE ECONOMICS 0455 EXAM QUESTIONS AND ANSWERS 2025

IGCSE ECONOMICS 0455 EXAM
QUESTIONS AND ANSWERS 2025

, Economic Growth - ANSWERSThe increase in output of the value of the goods and
services produced in a country over a period of time

Supply-side Policy - ANSWERSA government action which leads to an increase in
aggregate supply in an economy by improving either the quality or the quantity of
resources

-Useful, for showing the opportunity cost of producing more of one product in terms of
how much of another you are giving up

Opportunity Cost - ANSWERSThe next best alternative given up when a decision is
made

Deruglation - ANSWERSThe removal of laws, rules and regulations, making it easier for
a business to enter or operate in an industry

Grant - ANSWERSA sum of money that is given by the government which does not
have to be repaid
Aggregate Supply (AS) - ANSWERSThe total supply of goods and services in an
economy

Productive Capacity/Productive Potential - ANSWERSThe ability of an economy to
produce goods and services if all factors of production are fully employed

Production Possibility Curve (PPC) - ANSWERS- Shows the maximum combined output
of two or more products a firm or an entire economy can produce with its available
resources

- Resources are being used efficiently if they are producing their maximum output

- But, because resources are scarce, producing more of one product means producing
less of another


Subsidies - ANSWERS- An amount of money given to a firm to lower the cost of
supplying the good or service to the market

- Payments made by the government to domestic businesses to reduce the cost of
production