NSS Exploring Economics 2 (3rd Edition)
Answers to Exercises
Multiple Choice Questions
1. A
Option A is the answer because the output is water, which is tangible.
2. C
Option C is correct because the tablet computer is used to help the property agent provide
services.
3. D
All of them belong to tertiary production. While the outputs of car manufacturing and
clothing production are tangible, car repair and dry cleaning are intangible. Catering also
belongs to services because it mainly serves customers at specific venues, as opposed to
the operation of a food factory.
4. D
The landlords provide accommodation services, and the flats help them provide the
services.
5. B
Secondary production supplies capital goods (i.e., producer goods) to primary producers
while tertiary production provides services to primary producers.
6. D
Option A is incorrect. If the total employment in Country A (100 people) is much smaller
than that in Country B (10,000 people), the number of people engaged in primary
production in Country A (= 100 × 25% = 25) can be smaller than that in Country B (=
10,000 × 3% = 300).
Option B is incorrect. Though the contribution of primary production to total employment
is smaller than that of secondary production, its contribution to the total value of
production may be larger if primary production uses many more machines or produces
outputs of much higher value than secondary production.
Option C is incorrect. Since the figure of the preceding period is not provided, we do not
know if the contribution has increased or decreased.
8. A
Option A is incorrect. With division of labour, workers feel bored and have lower job
satisfaction. Division of labour does not raise workers’ work incentive.
NSS Exploring Economics 2 (3rd Edition) 1 © Pearson Education Asia Limited 2019
Answers to Exercises (Chapter 9)
9. C
Options A and B are incorrect because division of labour does not imply that workers are
overburdened and work longer hours. Instead, with higher productivity, workers can
produce the same amount of output using less production time.
Option D: With division of labour, the work of related industries or different production
stages are interdependent.
10. C
A product that requires individual creativity is less suitable for complex division of
labour.
p.60
Short Questions
1.
A calculator is a consumer good if it is bought by a student to satisfy wants, e.g., for doing
homework. (2 marks)
A calculator is a producer good if it is bought by a teacher to help provide teaching services,
e.g., for calculating students’ marks. (2 marks)
2.
a. They provide services because their outputs (e.g., babysitting, buying food and cleaning)
are mostly intangible. (2 marks)
b. They engage in tertiary production because they provide services. (2 marks)
3.
a. Peter is involved in secondary production because he uses wood (raw materials) to make
wooden furniture (finished products). (2 marks)
He is also involved in tertiary production because he offers retailing services by selling
his products at a flea market. (2 marks)
b. Example of primary products needed: timber
Examples of secondary products needed: saw, nails, screws and electricity
Examples of tertiary products needed: transport, warehousing, insurance and banking
services
(ONE example for each type of products. 1 mark × 3 = 3 marks)
NSS Exploring Economics 2 (3rd Edition) 2 © Pearson Education Asia Limited 2019
Answers to Exercises (Chapter 9)
4.
Division of labour. (1 mark)
Reasons for increasing labour productivity:
● The firm can choose the most suitable person for the job.
● Practice makes perfect.
● Workers need less time for training.
● Workers can save time as they don’t have to shift from one task to another.
● More workers have access to capital goods.
● It stimulates mechanisation.
(Any THREE of the above. 1 mark × 3 = 3 marks)
5.
Possible reasons include:
● the number of customers is smaller;
● service hours are much shorter — only operate during recess, lunchtime, and before and
after school;
● cooking is usually prohibited and thus products offered by a school tuck shop are limited.
(Any TWO of the above or other reasonable answers. 2 marks × 2 = 4 marks)
p.61
Structured Questions
1.
a. Division of labour. (1 mark)
b. Advantages:
● The economy can allocate the most suitable workers to the industries.
● The economy can save time and the costs of training workers.
● Labour productivity increases.
● Specialisation stimulates mechanisation.
● Specialisation raises capital productivity.
● Specialisation raises living standards.
(Any THREE of the above. 1 mark × 3 = 3 marks)
NSS Exploring Economics 2 (3rd Edition) 3 © Pearson Education Asia Limited 2019
Answers to Exercises (Chapter 9)
Disadvantages:
● Work becomes boring.
● It is difficult for workers to recognise their contribution and have job satisfaction.
● Greater risk of unemployment. With specialised skills only, workers have difficulty in
finding a new job if unemployed.
● Disruption in one production stage may hinder the others.
● Excessive standardisation of products reduces consumers’ choices and satisfaction.
(Any THREE of the above. 1 mark × 3 = 3 marks)
c. Factors that limit the use of division of labour include a small market size and work that
requires individual creativity. (2 marks)
2.
a. Agriculture, fishing, mining and quarrying belong to primary production. In 2000, the
percentage contribution of primary production was 0.1%. (2 marks)
Manufacturing, electricity, gas and water supply, waste management and construction
belong to secondary production. In 2000, the percentage contribution of secondary
production was 12.6% (= 4.8% + 2.9% + 4.9%). (2 marks)
Services belong to tertiary production. In 2000, the percentage contribution of tertiary
production was 87.2%. (2 marks)
b. No. (1 mark)
Value of primary production (VP)
= Percentage contribution of primary production to total value of production (PP)
× Total value of production (1 mark)
Though PP remained at 0.1% in 2000 and 2015, VP is not constant if the total value of
production changed in the period. (1 mark)
c. No. (1 mark)
Though the contribution of tertiary production to the total value of production increased,
it does not imply that tertiary production also employed a larger proportion of total
employment. The increase in the total value of production can be achieved by employing
more advanced machines or producing outputs of higher value. (2 marks)
NSS Exploring Economics 2 (3rd Edition) 4 © Pearson Education Asia Limited 2019
Answers to Exercises (Chapter 9)
