| Date | November 2019 | Marks available | 10 | Reference code | 19N.1.SL.TZ0.4 |
| Level | Standard level | Paper | Paper 1 | Time zone | Time zone 0 |
| Command term | Explain | Question number | 4 | Adapted from | N/A |
Question
Explain, using a production possibilities curve (PPC) diagram, an increase in the actual output of an economy.
Discuss the view that economic growth always leads to a rise in living standards.
Markscheme
Marks should be allocated according to the paper 1 markbands for May 2013 forward, part A.
Answers may include:
- definitions of production possibilities curve, actual output
- PPC diagram to show an increase in actual output
- explanation that an increase in actual output results from increased utilization of resources, showing a movement towards the production possibility curve
- example of actual growth in specific countries.
Marks should be allocated according to the paper 1 markbands for May 2013 forward, part B.
Answers may include:
- definitions of economic growth, living standards
- PPC diagram or AD/AS diagram to depict economic growth
- explanation of why economic growth leads to a rise in living standards because, for example, of rising incomes and employment
- example of economic growth leading to changes in living standards
- synthesis or evaluation (discuss).
Discussion may include: consideration that economic growth may not always lead to a rise in living standards because of factors such as environmental costs, the distribution of income, inflation and how the increased use of capital intensive technology may lead to unemployment.
Examiners report
Syllabus sections
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17M.1.SL.TZ2.04a:
Explain the causes of economic growth in terms of an increase in actual output and an increase in potential output.
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17M.2.HL.TZ0.03c:
Using a production possibilities curve (PPC) diagram, explain how “the government’s record US$22 billion investment in infrastructure projects” will affect Indonesia’s production possibilities (paragraph 2).
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18M.3.HL.TZ0.2e.iv:
In Country Beta, investment by firms increases in the first quarter of 2019.
The following diagram illustrates the long-run aggregate supply curve (LRAS), short-run aggregate supply curve (SRAS) and aggregate demand curve (AD) for Country Beta before the increase in investment.
The increase in investment results in both short-run and long-run effects on the economy. On the diagram above, draw and label the two curves that illustrate these effects.
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19M.2.HL.TZ0.4a.ii:
Define the term productivity indicated in bold in the text (paragraph [5]).
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17M.2.SL.TZ0.04b:
Using a production possibilities curve (PPC) diagram, explain how “billions of US dollars worth of infrastructure investment from China” may affect potential economic output (paragraph 1).
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19M.2.SL.TZ0.3c:
Using a production possibilities curve (PPC) diagram, explain how rising numbers of university graduates will affect Bhutan’s potential output (paragraph [5]).
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20N.2.SL.TZ0.2c:
Using an AD/AS diagram, explain the desired impact of China’s “eased monetary policy” on its economic growth (paragraph [5]).
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21M.2.HL.TZ0.4a.ii:
Define the term investment indicated in bold in the text (paragraph [5]).
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18M.3.HL.TZ0.2e.iii:
The following diagram illustrates the long-run aggregate supply curve (LRAS), short-run aggregate supply curve (SRAS) and aggregate demand curve (AD) for Country Beta before the increase in investment.
The increase in investment results in both short-run and long-run effects on the economy. On the diagram above, draw and label the two curves that illustrate these effects.
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21M.3.HL.TZ0.1b:
State one reason why the production possibility curve (frontier) for Country H might shift outwards.
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18M.1.SL.TZ2.3a:
Explain how an increase in investment might lead to economic growth.
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18N.2.SL.TZ0.4b:
Using a production possibilities curve (PPC) diagram, explain the effect on economic growth of the “destruction of much of the country’s physical, social and human capital” (paragraph [1]).
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19M.1.SL.TZ1.4a:
Explain the role of improved productivity in achieving economic growth.
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18N.1.HL.TZ0.4a:
Explain the potential effects on the economic growth rate from a substantial increase in the number of skilled people of working age entering a country.
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19N.3.HL.TZ0.3b:
Gardia is aiming to increase its economic growth rate. Explain two sources of economic growth for economically less developed countries.
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21M.2.HL.TZ0.3c:
Using a production possibilities curve (PPC) diagram, explain how the production possibilities (potential output) of the DRC might be affected if there were greater access to electricity (paragraph [4]).
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20N.2.HL.TZ0.4c:
Using a production possibility curve (PPC) diagram, explain how damage to Fiji’s infrastructure has affected its production possibilities (paragraph [1]).
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21N.3.HL.TZ0.3i:
Calculate the total welfare loss resulting from the imposition of the tariff on chia seeds.
