Economics Paper 2, May/June 2011  
Questions: 1 2 3 4 5 6 7 8 9 10 11 12 Main
General Comments

Question 1

      The supply situation for rice in country X over a period is as shown in the table below.  Use the information in the table to answer the questions that follow:


Price (1)

Quantity Supplied (bags)

December 2004



January 2007



April 2009



    (a) Calculate the coefficient of price elasticity of supply for rice between December 2004 and January 2007.                      

          (b) Is the supply of rice elastic or inelastic? Give a reason for your answer.

    (c) State any three reasons which may cause an increase in the supply of rice.

A good number of candidates who attempted this question scored fairly above average marks.  Generally, candidates were able to provide correct answers for the (a) and (b) parts of the question.  The (c) part of the question was however not well answered.  Most candidates wrote down the factors that could affect supply generally and not reasons which may cause increase in the supply of rice as it was required in the question. 

These candidates failed to state any three of the following:

  1. improvement in technology;
  2. favourable weather conditions;
  3. increase in the number of producers or importers of rice;
  4. reduction in taxation which stimulates production or importation of rice;
  5. increase in subsidies to rice producers;
  6. reduction in the prices of inputs related to the production of rice.
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