Each question carries ten marks. There is a word limit on each question of 500 words, submissions exceeding this limit will be penalised.

Question 1: The terms of trade (5 marks to parts a and b)

a) What do we mean by the terms of trade?

b) How have changes in the terms of trade, in the long term, affected farm incomes in Australia?

Question 2: Pollution control

Using a series of bullet points and brief explanations list the advantages and disadvantages of using standards or economic instruments (e.g. taxes or emissions trading schemes) to control pollution.