0455 Economics November 2024 Question paper 22

1 (a) Calculate the percentage of the Jordanian labour force employed in the secondary sector. [1]

(b) Identify two components of the current account of Jordan’s balance of payments. [2]

(c) Explain the main type of unemployment experienced by Jordan in 2020. [2]

(d) Explain two advantages the Jordanian economy may gain from the mergers between its tourism firms. [4]

(e) Analyse the relationship between birth rate and average age. [4]

(f) Analyse, using a demand and supply diagram, how an increase in population size will affect the market for clothing. [5]

(g) Discuss whether or not the Jordanian government should spend more on renewable energy.

[6]

(h) Discuss whether or not the Jordanian central bank should have raised the rate of interest in 2021. [6] Section B Answer any three questions. Each question is introduced by stimulus material. In your answers you may refer to the material and/or other examples you have studied.

2 In 2021, the production point on the UK’s production possibility curve (PPC) changed. Average wages increased. The average annual wage of a waiter was $23,580 while that of a chief executive of a large commercial bank was$1,617,000. A rise in wages enables people to eat in restaurants more often. Some of the food sold in UK restaurants is imported. In 2021, the UK government signed free trade agreements, removing import restrictions, with a number of countries.

(a) Identify two places where a production point could be located on a PPC diagram. [2]

(b) Explain two reasons why someone may switch from eating in one restaurant to eating in another restaurant. [4]

(c) Analyse why the wage of a chief executive of a large commercial bank is higher than that of a waiter. [6]

(d) Discuss whether or not free trade will increase economic growth. [8]

3 The central bank of Madagascar intervenes in the country’s foreign exchange market. However, Madagascar has a largely market economic system. Nearly 70% of Madagascar’s population live in poverty. Most of the country’s industries are labour-intensive. In 2020, Madagascar had an economic growth rate of 6% and a deficit on the current account of its balance of payments of $0.6bn.

(a) Define foreign exchange market. [2]

(b) Explain two reasons why a firm may adopt labour-intensive production. [4]

(c) Analyse how the macroeconomic aims of economic growth and balance of payments stability may conflict. [6]

(d) Discuss whether or not a high level of poverty is likely to exist in a market economic system.

[8]

4 In 2021, there were extensions and contractions in demand for a number of South African products. In that year, a South African court stopped a multinational company (MNC) exploring for oil along South Africa’s coastline. South Africa experienced an increase in output, driven largely by the growth in its tertiary sector. However, its unemployment rate was 35%, a long way from full employment.

(a) Define an extension in demand. [2]

(b) Explain two external costs that may be caused by exploring for oil. [4]

(c) Analyse how growth in a country’s tertiary sector can increase its living standards. [6]

(d) Discuss whether or not workers who lose their jobs are likely to stay unemployed for a long time. [8]

5 The Peruvian government is under pressure from its industries to improve the country’s transport system. Peru’s third largest industry is tourism. There are many firms in the Peruvian tourism industry. Another major industry in Peru is fruit farming. In recent years, trade union membership in the Peruvian fruit-farming industry has increased.

(a) Identify two examples of labour employed in the tourism industry. [2]

(b) Explain two reasons why countries with a good transport system often have a high GDP. [4]

(c) Analyse the benefits consumers may gain from a competitive market. [6]

(d) Discuss whether or not an increase in trade union membership will benefit an economy. [8]