Question 21N.3.HL.TZ0.2f
| Date | November 2021 | Marks available | [Maximum mark: 4] | Reference code | 21N.3.HL.TZ0.2f |
| Level | HL | Paper | 3 | Time zone | TZ0 |
| Command term | Explain | Question number | f | Adapted from | N/A |
The data in Table 2 refer to Kanyaland, a small, open, developing economy in 2019. All data are in billions of Kanyaland dollars (K$).
Table 2
Assume that the level of GDP in Kanyaland in 2009 was K$455 billion and government expenditures were K$205 billion. For each additional Kanyaland dollar earned as income, it had been estimated that K$0.60 was spent on domestic goods and services, K$0.10 was saved, K$0.21 was paid in taxes and K$0.09 was spent on imported goods and services.
Explain how unemployment benefits and progressive taxation may help decrease economic fluctuations in Kanyaland.
[4]
A significant number of candidates found difficulty with this question. Lower-achieving responses understood “economic fluctuations” to mean “inequality”. Of those who understood the question and the appropriate learning outcome, a large number referred to the idea that unemployment benefits would allow consumers to spend more, without explaining how this would slow down a decline in real GDP. For full marks, candidates were expected to refer to expansionary and contractionary periods — and some did not do this.
