Correct Answer: C. to their best alternatives

Correct Answer: D) It is held as a store of wealth

Explanation

This question is asking which of the given options is NOT a limited relevance of commodity money. Commodity money is any physical item used as a medium of exchange, such as gold or silver. The options given are A, B, C, and D. Option A says that costliness of transaction is a limited relevance of commodity money. Option B states that it limits market size. Option C claims that it hampers specialization. Option D, which is the correct answer, says that it is held as a store of wealth.

Commodity money has limited relevance due to its characteristics. One of these characteristics is that it is costly to transact with, as stated in option A. For example, if gold is used as a medium of exchange, it would be difficult to make small transactions because gold is valuable and small amounts of it are worth a lot of money.

Option B states that commodity money limits market size. This is because not everyone may have access to the commodity being used as money, and this could limit trade and commerce.

Option C states that commodity money hampers specialization. This is because people may have to spend time and resources to obtain the commodity used as money instead of specializing in their area of expertise.

Option D, which is the correct answer, states that commodity money is held as a store of wealth. This means that people may hoard the commodity instead of using it as a medium of exchange, which could limit its availability in the market and affect trade and commerce.

In summary, the correct answer to this question is option D, as it is not a limited relevance of commodity money.

Correct Answer: B. indifference curve

Explanation

An indifference curve is a graph showing combination of two goods that give the consumer equal satisfaction and utility.

Explanation

(a)Money is any commodity that is generally accepted as a means of payments for goods and services.

(b) Reasons for holding money are:

(i) Transactionary motives: People desire to keep or hold money for day to day transactions or current expenditures. Households need to hold money in order to cater for the interval between the receipt of incomes and their expenditures.

(ii) Precautionary motives: This is when people demand for money in order to meet up with unforeseen circumstances or unexpected expenditures. These may include sickness, unexpected visitors etc. Due to uncertainties in life, people keep money against future emergencies that may require monetary expenditures.

(iii) Speculative motives:This motive is specifically a business motive and refers to the desire to hold cash balances in order to embark on speculative dealings in the bond market. The demand to hold money for speculative purposes is interest elastic.

Correct Answer: D. The deregulation of the economy

Explanation

(a) Price elasticity of supply: it is the degree of responsiveness of quantity supplied of a commodity to a given change in its priceOR it is the percentage change in quantity supplied of a commodity to a percentage change in its price.

(b) Joint supply occurs when two or more commodities are produced and supplied from one source such that the supply of one commodity will lead to the supply of the other(s). Competitive supply on the other hand occurs when a commodity has alternative uses. An increase in the supply of one of its uses will reduce its supply for other uses.

(c) (i) Time: supply of commodities tends to be more inelastic in the short run and as time elapses, the more elastic it becomes e.g. agricultural produce.

(ii) Cost of production: Commodities with higher cost of production inputs tend to be more inelastic while commodities with lower cost of productive inputs are more elastic because it is cheaper to obtain more inputs to increase supply.

(iii) Nature of the product: Durable commodities tend to have more elastic supply while perishable commodities tend to have inelastic supply because they cannot be stored for long.

(iv) Market discrimination or segmentation: Commodities that can be sold at different prices in different markets tend to be more elastic while supply will be inelastic for commodities that can be sold in only one market.

(v) Availability of storage facilities: commodities that can be stored for a long time tend to have elastic supply while those that cannot be stored tend to have inelastic supply.

(vi) Number of producers: the larger the number of producers, the easier it is to increase output in response to price changes making supply elastic.

(vii) Mobility/availability of factors of production: if factors of production are more mobile the price elasticity of supply tends to be more elastic.

Correct Answer: A. the effect of diseases and pests

Explanation

The most direct economic impact of a trans-boundary pest or disease is the loss or reduced efficiency of agricultural production weather of reduced productivity on crops or animals can be long lasting. Although the loss of output from a trans-boundary pest or diseases may appear easy to identify, it can nevertheless be difficult to measure in precise economic terms.

Correct Answer: B. spend more money

Explanation

Anticipated inflation occurs when people know inflation is going to occur and prepare for it. For example, increased interest rates.

Explanation

(a) Economies of scale refer to the cost-saving advantages which a firm enjoys as it grows

larger in size.

(b)(i)Managerial economies: Large firms make possible division of labour in management which increases experience and efficiency of labour. i.e. Large firms are able to employ and retain specialists which leads to increased output.

(ii)Technical economies: In large firms, the intensive use of machinery leads to a reduction in average cost of production. Also, a large firm maynot have to increase the size of its machinery as the existing one may have a higher installed capacity.

(c) (i)Slow response to changes: As a result of its organizational and technical set-up, large scale firms take time to react and implement changes.

(ii) Since ownership is usually separated from control, workers do not always put in their best.

(iii) A large number of employees usually leads to lack of interpersonal relationship between the management, employees and customers.

(iv) The bureaucratic set-up of large scale firms usually leads to delay in decision- making.

(v) Large scale production may lead to the creation of monopoly. A large firm may use various methods to ward off competitors.

(vi) A large scale firm may fail to adequately forecast demand for its products, thereby engaging in overproduction, leading to a waste of resources.

(vii) A large firm can make great losses when mistakes are made which can be very costly.

(viii) As a firm expands, control and proper supervision of workers becomes more difficult.

Correct Answer: C. variable inputs are increased