Cambridge A Level Economics: Inclusive and sustainable growth (9708) – Practice Questions

These are original questions written for Marlbridge, for revision and practice on this content. They are not reproduced past-paper questions, and they do not replicate the exam’s exact structure, question count or mark tariffs – examination boards hold copyright in their own papers. Use these alongside the official past papers from your board or school.

These questions cover sections 9.2.5 and 9.2.6 (inclusive and sustainable economic growth) of the Cambridge International AS & A Level Economics 9708 syllabus for examination in 2026, 2027 and 2028. Topic 9 is A Level content only, so AS candidates do not sit it. All countries, firms, households and figures are invented.

Links: Cambridge A Level Economics hub, printable checklist, study guide, revision notes and free 10-minute diagnostics.

Questions

1. (a) Define inclusive economic growth. [2] (b) Distinguish between equity and equality. [3]

2. In Country Gamma, average income per household in the poorest fifth rises from 5.0 to 5.2 (thousand) and in the richest fifth from 30.0 to 33.0.

(a) Calculate the percentage growth of each group’s income. [2] (b) Calculate the absolute gain of each group. [1] (c) Calculate the ratio of richest to poorest income in each year. [2] (d) Comment on whether this growth is inclusive. [2]

3. Explain two policies a government could use to promote inclusive growth. [4]

4. (a) Define sustainable economic growth. [2] (b) Distinguish between a renewable and a non-renewable resource. [2]

5. A fishing area holds 1,200 tonnes of fish. The stock regenerates by 8% of its size each year. Fishers take 120 tonnes a year.

(a) State the sustainable yield in the first year. [1] (b) Calculate the stock after two years. [3] (c) Explain why this level of fishing is unsustainable. [2]

6. Country Delta has 450 million tonnes of a mineral and extracts 15 million tonnes a year.

(a) Calculate how long the reserve lasts at constant extraction. [1] (b) Extraction now grows by 5% a year. Show that the reserve runs out during year 19. [3] (c) Explain one reason why the reserve might last longer than your answer to part (b). [2]

7. A country emits 80 million tonnes of greenhouse gases. GDP rises 4% and emissions intensity (emissions per unit of GDP) falls 5%.

(a) Calculate the new level of emissions. [3] (b) Calculate emissions if intensity had fallen only 2%. [1] (c) Explain why a fall in emissions intensity does not guarantee a fall in emissions. [2]

8. In a market, the demand function is Qd = 800 − 10P and the supply function is Qs = −100 + 10P. Each unit causes 0.4 tonne of emissions. A tax of 10 per unit is placed on producers.

(a) Find the price and quantity at which the market clears before the tax. [2] (b) Calculate the equilibrium price and quantity after the tax. [3] (c) Calculate the change in emissions. [2] (d) Calculate the tax revenue and state who bears more of the tax. [2]

9. Suppose a carbon tax of this kind raises the price of the goods by 10%. A low-income household with income 9,000 spends 400 on these goods. A high-income household with income 48,000 spends 1,200 on them.

(a) Calculate the extra cost as a percentage of income for each household. [3] (b) Suggest one way the government could offset the effect on the low-income household. [2]

10. Firms X and Y each emit 90 tonnes. A cap allows 120 tonnes in total. Reducing emissions costs X 12 per tonne and Y 36 per tonne.

(a) Calculate the total cost if each firm cuts emissions by the same amount. [2] (b) Calculate the total cost if X makes the whole cut. [1] (c) Explain how tradable permits could achieve the second outcome. [3]

11. Evaluate the view that policies to reduce environmental damage from growth will always make growth less inclusive. [10]

Answers

1. (a) Growth in which the benefits are shared widely across society [1], with opportunities open to poorer households, regions and groups [1]. [2] (b) Equality is an even spread of income or wealth, which can be measured [1]. Equity is fairness of the distribution [1], a normative judgement that depends on values, so an equal outcome may not be equitable [1]. [3] Examiner insight: a one-line contrast scores less than a pair of clear definitions. State what each term means, then say which is measurable.

2. (a) Poorest: (5.2 − 5.0) ÷ 5.0 × 100 = 4.0% [1]. Richest: (33.0 − 30.0) ÷ 30.0 × 100 = 10.0% [1]. [2] (b) Poorest gain 0.2, richest gain 3.0 (thousand) [1]. [1] (c) Year 1: 30 ÷ 5 = 6.0 [1]. Year 2: 33 ÷ 5.2 = 6.3 [1]. [2] (d) The poorest gain, but their growth is well below the richest group’s [1]. The gap widens in absolute and relative terms, so the growth is not inclusive [1]. [2] Examiner insight: show the working for each group separately and then compare. A comment that cites both the percentages and the ratio is stronger than one that quotes only the mean.

3. Policy one, for example education and training: it raises the skills of lower-income workers [1], so they can earn more and gain from growth [1]. Policy two, for example progressive taxes and transfers: they take a higher share from high earners [1] and pay benefits to low-income households, which narrows gaps [1]. [4] Examiner insight: for each policy, link the mechanism to the poorest group. Naming a policy without that link gains little.

4. (a) Growth that meets today’s needs [1] while leaving future generations able to meet theirs [1]. [2] (b) A renewable resource regenerates, so it can be used indefinitely if use does not exceed regeneration [1]. A non-renewable resource is finite, so any use reduces what remains [1]. [2] Examiner insight: include the future-generations idea in the definition. A definition that only says protecting the environment is incomplete.

5. (a) 8% of 1,200 = 96 tonnes [1]. [1] (b) Year 1: 1,200 + 96 − 120 = 1,176 [1]. Year 2 regeneration: 0.08 × 1,176 = 94.08 [1]. Stock = 1,176 + 94.08 − 120 = 1,150.08, about 1,150 tonnes [1]. [3] (c) Harvest (120) exceeds regeneration (96) [1], so the stock falls each year, which cuts future regeneration and future catches [1]. [2] Examiner insight: regeneration is a percentage of the current stock, so recalculate it each year. Using the original 96 in year 2 is a common slip.

6. (a) 450 ÷ 15 = 30 years [1]. [1] (b) Cumulative extraction after n years = 15 × (1.05ⁿ − 1) ÷ 0.05 [1]. After 18 years: 15 × (1.05¹⁸ − 1) ÷ 0.05 = 422.0, which is below 450 [1]. After 19 years: 458.1, which is above 450, so the reserve runs out during year 19 [1]. [3] (c) New discoveries add to reserves [1]. Alternatively, a rising price may slow extraction, or recycling and substitutes may reduce demand [1]. [2] Examiner insight: in a show-that question, give the figure on each side of 450 so the conclusion follows from your working.

7. (a) Emissions change factor = 1.04 × 0.95 [1] = 0.988 [1]. New emissions = 80 × 0.988 = 79.04 million tonnes, a fall of 1.2% [1]. [3] (b) 80 × 1.04 × 0.98 = 81.5 million tonnes [1]. [1] (c) If GDP grows faster than intensity falls, total emissions rise [1], and the stock of gases in the atmosphere keeps building even when emissions grow more slowly than GDP [1]. [2] Examiner insight: multiply the growth factors rather than subtracting the percentages. Subtracting gives a different answer.

8. (a) 800 − 10P = −100 + 10P gives 900 = 20P [1]. P = 45 and Q = 350 [1]. [2] (b) New supply: Qs = −100 + 10(P − 10) = −200 + 10P [1]. 800 − 10P = −200 + 10P gives P = 50 [1]. Q = 300 [1]. [3] (c) Before: 350 × 0.4 = 140 tonnes [1]. After: 300 × 0.4 = 120 tonnes, a fall of 20 tonnes [1]. [2] (d) Revenue = 10 × 300 = 3,000 [1]. Consumers pay 5 more (50 − 45) and producers receive 5 less (40 instead of 45), so the burden is shared equally [1]. [2] Examiner insight: a tax on producers shifts the supply curve up by the amount of the tax. Describe the shift in words if you are asked for a diagram.

9. (a) Extra cost: low-income 10% of 400 = 40, so 40 ÷ 9,000 = 0.44% of income [1]. High-income 10% of 1,200 = 120, so 120 ÷ 48,000 = 0.25% [1]. The low-income household pays a larger share, so the tax is regressive [1]. [3] (b) Return some of the tax revenue as a rebate to low-income households [1], for example a payment of at least 40 a year to the household in the question, which would cover its extra cost [1]. [2] Examiner insight: compare shares of income. Comparing the money amounts, 40 and 120, points the other way and misses the question.

10. (a) Each cuts 30 tonnes (60 in total). X: 30 × 12 = 360 [1]. Y: 30 × 36 = 1,080. Total = 1,440 [1]. [2] (b) X cuts 60 tonnes: 60 × 12 = 720 [1]. [1] (c) Give each firm 60 permits, so each may emit 60 tonnes [1]. X cuts its emissions to 30 tonnes and sells 30 spare permits to Y [1]. Y buys at any price between 12 and 36, for example 24, which costs it 720, less than its abatement cost of 1,080. X receives 720, which covers its cost of cutting, so both gain [1]. [3] Examiner insight: state the price range in which both firms gain. Trade only happens between the two abatement costs.

11. A strong answer covers these points:

• Analysis of the claim: a carbon tax or higher energy prices take a larger share of low incomes, as shown by a regressive effect [1]. Regulation can raise costs and prices, and job losses in polluting industries can fall on workers with few other options [1].
• Analysis against: pollution often harms poorer groups most, for example through poor air quality or climate shocks, so reducing damage can be inclusive [1]. Green investment can create jobs in lagging regions [1].
• Evaluation: recycling revenue as rebates or training can offset the cost to low-income households [1]. The effect depends on the policy chosen, the elasticity of demand for the taxed good, how revenue is used and the country’s income level [1]. Timing matters, as costs may come first and benefits later [1]. Compensation needs funding [1].
• Judgement: a supported conclusion, for example that the claim is too strong because “always” ignores design, but that unmitigated taxes can hurt the poor [1]. A view on which factor matters most [1]. [10] Examiner insight: the word “always” invites you to find one case where the claim fails and to explain what makes the difference. Finish with a judgement tied to those conditions.

Where marks are usually lost

• Defining inclusive growth as faster growth.
• Treating equity and equality as the same.
• Quoting the mean growth rate when the question asks about the poorest group.
• Comparing money amounts instead of percentages of income.
• Using the original stock each year instead of recalculating regeneration.
• Subtracting percentages instead of multiplying growth factors.
• Shifting demand instead of supply when a tax falls on producers.
• Listing policies without a judgement about which works best and why.

Next steps

• Reread the revision notes and the study guide.
• Go back to the Cambridge A Level Economics hub and the printable checklist to record progress.
• Try all the free 10-minute diagnostics.
• Book a free trial class.

Official syllabus

Cambridge International AS & A Level Economics 9708 syllabus for examination in 2026, 2027 and 2028, published by Cambridge University Press & Assessment (Cambridge International), sections 9.2.5 and 9.2.6.