Estimates in 2015 put the GDP of New Zealand at US191 billion, Peru at US190 billion and Romania at US$189 billion. Are these figures a sufficient indication that the standard of living in the three countries was very similar?

Mark scheme

Marking points from the official mark scheme (May/June 2017). The mark or mark type is shown in brackets.

1. [12] (a) Comment on relative worth of using GDP. Weakness of using GDP can be partly overcome by using real GDP per capita but it omits social issues – education, health, sanitation, working hours – doesn't include unpaid work, informal economy, quality of goods, types of goods, long run v. short run, environmental issues, distribution of income, sustainability. These qualitative factors are considered with other indicators. Level 4 (9-12 marks): for a sound explanation with good illustrations and a clear understanding of the principles involved and a reasoned conclusion.
2. [13] (b) Distinction between the policies and comment on how changes in taxes and expenditure may affect income and the provision of facilities influencing standards of living. Level 4 (9-13 marks): for a sound explanation with good illustrations and a clear understanding of the principles involved and a reasoned conclusion.