mock feedback questions i got wrong

Question 1

In 2021, Bolivia’s terms of trade were 62 and its index of average export prices was 85.56.

Calculate Bolivia’s index of average import prices in 2021.

Answer 1

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Question 2

In January 2023, Japan had an unemployment rate of 2.4%. It was considered to be achieving full employment.

Evaluate with the use of an appropriate diagram(s), whether achieving full employment will benefit an economy.

Answer 2

1AN - Keynesian diagram analysis - benefits the economy as higher real GDP increases living standards and raises tax rev for gov

2AN - AD/SRAS diagram analysis - benefits the economy how?? Unemployment lowers.

1EVAL - does not necessarily benefit an ec. if jobs are low productivity/insecure - real gdp rise in quantity not productivity (firms rely on cheap labour) - employment is high but wages remain low (int comp does not improve)

2EVAL - labour shortages reducing benefits of future growth - low u/e, firms struggle to recruit workers (Bid up wages) - increase firms costs, passed on as cost push inflation, reducing real incomes - might prompt contractionary monetary policy (High i) - macroeconomic instability

conc - likely to benefit an ec. - ult. depends on the prod. and skills of the workforce (low skilled jobs - limited growth, weak wage increases) has to be accompanied by investment in human capital and training

Question 3

The Central African Republic has a very uneven distribution of income and a low development index (HDI) value.

Evaluate whether a very uneven distribution of income will result in a country having a low HDI value.

Answer 3

1AN - restricts access to healthcare and ed for poorer groups - large sections of pop earn very little - cannot afford quality ed - lower life expectancy, lower mean years of schooling - widespread deprivation pulls down hdi value

2AN - reduce gov capacity to improve development - inc. ineq results in low tax collection from riches (tax avoidance) - limits gov rev to hospitals and schools - health and ed quality stagnates - prevents improvements in HDI

1EVAL - does not always if strong public services exist - eg. UK strong welfare systems (free healthcare) - LIH can access hospitals and ed - prevents inequality translating to poor dev outcomes.

2EVAL - may be caused by poor governance or political instability, reduces school attendance - low HDI

conc - ult. depends on the effectiveness of institutions (tax high earners) then high inequality may co exist with high HDI