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Barriers to Economic Growth and/or Economic Development · Paper 1 — Free Economics SL Practice Questions
1MasterySAQ-SFactors inhibiting economic development7 marksPaper 1~11 min
The country of Andolia has a Gini coefficient of , indicating severe income inequality. A large proportion of its population lives in rural areas with limited access to formal banking services. The government is considering a policy to provide microfinance loans to rural women to start small businesses.
(a)
Using a fully labelled Lorenz curve , explain one way in which the high level of income inequality in Andolia acts an internal barrier to economic development. [3 marks]
(b)
Evaluate the effectiveness of microfinance loans a policy to reduce income inequality and promote economic development in Andolia. [4 marks]
Solutions
2MasterySAQ-SFactors inhibiting economic development4 marksPaper 1~6 min
In the developing country of Morova, the population growth rate is per year, while real GDP growth is per year. of the population is under the age of 15. The country has limited arable land freshwater resources.
(a)
Using a fully labelled production possibilities curve (PPC) , show Morova's output per capita could fall despite economic growth. [2 marks]
(b)
Using the data and your , explain how rapid population growth acts an internal barrier to economic development in Morova. [2 marks]
Solutions
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