0455/22/F/M/23

Vietnam has a high number  of female entrepreneurs. Some of their firms have grown and now compete with foreign multinational companies (MNC) and public sector firms. The Vietnamese government encourages MNCs to locate in Vietnam as a host country. It also intervenes in the economy to encourage the consumption of merit goods.

• Analyse how a government  could encourage the consumption of merit goods. [6]

0455/22/F/M/23

In 2019 India became the world's largest  producer of sugar. Sugar cane is grown in the country by a large number of mainly low-income farmers. They sell sugar cane to mills which process the sugar cane into sugar. Processing the sugar cane is more capital intensive than growing it. The Indian government sets a minimum price for sugar cane and subsidises the export of sugar.

• Discuss whether or not government subsidy on the export of sugar will help it achieve its macroeconomic aims. [8]

0455/21/O/N/22 

Jordan has a fixed foreign exchange rate with the US dollar. The monetary policy of Jordan, therefore, follows the monetary policy of the US very closely. Due to low confidence in the global economy in 2019, central banks around the world, including Jordan and the US, cut interest rates to stimulate growth. However, this may have conflicted with the macroeconomic aim of low inflation. 

• Analyse how a cut in interest rates might create conflicts between macroeconomic aims. [6] 

0455/23/M/J/21 

Latvia is one of the fastest growing economies in Europe. Although its GDP per head is below the European average, it is quickly catching up. Living standards are improving. At the same time, a decrease in borrowing has reduced the chance of high inflation. The job market is also improving as the unemployment rate is falling. However, there are concerns that there might be less balance of payments stability. 

• Analyse how economic growth conflicts with balance of payments stability. [6] 

0455/22/F/M/21 

India has experienced a relatively high economic growth rate in recent years. This growth has been driven by increases in government spending and exports, including exports of textiles. India’s unemployment rate has, however, increased. The government is concerned that trying to reduce unemployment may increase India’s inflation rate. 

• Discuss whether or not a government can reduce unemployment without increasing inflation. [8]