Measuring Development · Paper 2 — Free Economics SL Practice Questions

Country X has experienced steady growth in its real GDP per capita (PPP) of $4\%$ per year for the past decade. Over the same period, the country's Gini coefficient has risen from $0.35$ to $0.48$. The government of Country X claims its development strategy has been highly successful, citing rising GDP per capita as evidence. *

Country Y is a low-income country in Sub-Saharan Africa. Its GDP per capita has risen from USD 800 to USD 1,100 over the last five years. However, the country has an infant mortality rate of $85$ per $1{,}000$ live births, an adult literacy rate of $45\%$, and frequent power outages that disrupt economic activity. A recent World Bank report notes that Country Y's HDI rank is $175$ out of $189$ countries, while its GDP per capita rank is $165$. - GDP per capita $=$ Gross Domestic Product $\div$ total population. - The Human Development Index (HDI) is a composite index based on: (i) life expectancy at birth, (ii) mean and expected years of schooling, and (iii) GNI per capita (PPP). - Infant mortality rate $=$ number of deaths of infants under one year old per $1{,}000$ live births.

Country X is a lower-middle-income nation in Southeast Asia. In 2023, its GDP per capita was USD 4,200 (PPP). Its Human Development Index (HDI) value was 0.620, with life expectancy at birth of 68 years, expected years of schooling of 11.2, and mean years of schooling of 6.8. The Gini coefficient was 0.45. The economy relies heavily on garment manufacturing ($35\%$ of exports) and remittances from overseas workers ($12\%$ of GDP). The government has announced 'Vision 2030', which aims to double GDP per capita by attracting foreign direct investment (FDI) into electronics assembly, while simultaneously introducing a universal basic education programme to raise mean years of schooling to 9.0.