Exam (elaborations)
2020 Past Paper
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Exam of 28 pages for the course 601/4799/4 at OCR (The 2020 Past Paper)
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PMTOxford Cambridge and RSA
Friday 09 October 2020 – Afternoon
A Level Economics
H460/02 Macroeconomics
Time allowed: 2 hours
You can use:
* 8 3 3 0 0 2 2 4 1 9 *
• a scientific or graphical calculator
* H 4 6 0 0 2 *
Please write clearly in black ink. Do not write in the barcodes.
Centre number Candidate number
First name(s) �
Last name �
INSTRUCTIONS
• Use black ink. You can use an HB pencil, but only for graphs and diagrams.
• Write your answer to each question in the space provided. If you need extra space use
the lined pages at the end of this booklet. The question numbers must be clearly shown.
• Answer all the questions in Section A, one question in Section B and one question in
Section C.
INFORMATION
• The total mark for this paper is 80.
• The marks for each question are shown in brackets [ ].
• Quality of extended response will be assessed in questions marked with an asterisk (*).
• This document has 28 pages.
ADVICE
• Read each question carefully before you start your answer.
© OCR 2020 [601/4799/4] OCR is an exempt Charity
DC (MS/CB) 193210/4 Turn over
, PMT
2
SECTION A
Read the following stimulus material and answer all parts of question 1 which follow in this section.
Are low-income countries playing catch up?
The global economy is changing. It is becoming more integrated and China is moving towards
becoming the world’s largest economy. Lower costs of transport continue to increase the volume
of international trade. Producing in different countries and buying products from anywhere in the
world are being made easier by advances in communications.
5 World trade grew by 4.4% in 2017 and is predicted to grow by 4.7% in 2018. China is accounting
for a higher proportion of this global trade and a higher proportion of global output. The country
has experienced a significant rise in its GDP per head in recent years. This has had an impact on
its citizens’ life expectancy. Fig. 1 shows the average income and life expectancy in a number of
countries.
Fig. 1 GDP per head and life expectancy in selected countries 2017
Country GDP per head ($) Life expectancy (years)
Bangladesh 4200 73.7
China 16 700 75.8
Egypt 12 700 73.2
Germany 50 800 80.9
Guinea 2200 62.1
Japan 42 900 85.5
UK 44 300 80.9
USA 59 800 80.1
10 Developments in the Chinese economy can be illustrated by both movements in the country’s
production possibility points and in the position of the production possibility curve as shown in
Fig. 2.
© OCR 2020
, PMT
3
Fig. 2 A country’s production possibility curve and points
Capital
goods
Z
Y
X
W
0 Y Z
Consumer goods
The Bangladeshi economy has also grown in recent years, but its growth has been more erratic.
In 2017, the country’s main export destinations were the USA, Germany, UK and France. Its main
15 sources of imports were China, India, Singapore and Japan. In 2017, the value of its exports to
the UK was £2251 m while the value of its imports from the UK were £190 m. Bangladesh is also a
recipient of UK overseas aid. In 2016, the UK government spent £13.4 bn on overseas aid, in line
with its target of 0.7% of GDP. Bangladesh was the 11th largest recipient, receiving £170 m. Fig. 3
provides some more information on the Bangladeshi economy.
Fig. 3 Details on the Bangladeshi economy 2017
$ billion
Consumer expenditure 191
Exports 50
Government spending 13
Investment 76
Imports 68
Tax revenue 25
20 Bangladesh’s finance minister suggested in 2017 that he would cut the country’s corporate tax
rates as they are much higher than most other countries. He argued that such a move would
increase the country’s rate of economic growth.
© OCR 2020 Turn over
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