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O-LevelEconomicsEconomic development2281/22 · Oct/Nov 2019 · Q420 Marks

Mali is a developing country. Its Human Development Index (HDI) rose from 0.297 in 2000 to 0.442 in 2016. Most of Mali's workers are employed in agriculture and cotton is the country's main agricultural crop. The country's main export, however, is gold. The country is the third largest exporter of gold in Africa.

  1. (a)Identify two components of the HDI.[2]
  2. (b)Explain how the proportion of a country's resources devoted to the primary, secondary and tertiary sectors change as its economy develops.[4]
  3. (c)Analyse, using a demand and supply diagram, how a fall in the price of cotton would affect the market for cotton shirts.[6]
  4. (d)Discuss whether or not an increase in the size of a country's gold mining industry will benefit an economy.[8]

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Mark scheme

Marking points from the official mark scheme (Oct/Nov 2019). The mark or mark type is shown in brackets.

  1. [1] (a) GDP (GNI) per head / income per head / average income
  2. [1] (a) education
  3. [1] (a) life expectancy
  4. [1] (b) A smaller proportion of resources are likely to be devoted to the primary sector
  5. [1] (b) increases in technology / productivity / education requires fewer resources / resources move to more financially rewarding uses / use of more machinery
  6. [1] (b) A greater proportion of resources are devoted to manufacturing at first
  7. [1] (b) and then a smaller proportion
  8. [1] (b) the manufacturing sector becomes more efficient
  9. [1] (b) The service sector continues to grow
  10. [1] (b) in developed economies, most labour is employed in the service sector
  11. [1] (b) Some developing countries' tertiary sector has grown faster than secondary sector – jumped a stage
  12. [1] (c) Axes correctly labelled – price and quantity or P and Q
  13. [1] (c) Demand and supply curves correctly labelled
  14. [1] (c) Supply curve shifted to the right
  15. [1] (c) Equilibriums – shown by lines or e.g. E1 and E2
  16. [1] (c) A fall in the price of cotton will reduce the cost of producing cotton shirts
  17. [1] (c) price will fall / quantity will rise
  18. [1] (d) It may provide more jobs
  19. [1] (d) reduce unemployment
  20. [1] (d) It may increase output / cause economic growth
  21. [1] (d) increase wages
  22. [1] (d) increase living standards
  23. [1] (d) Some of the gold may be exported
  24. [1] (d) improve the current account position
  25. [1] (d) The industry may experience (external) economies of scale
  26. [1] (d) lower average cost
  27. [1] (d) example of an external economy
  28. [1] (d) It will be more beneficial if world demand is increasing
  29. [1] (d) May attract multinational companies to set up in the country
  30. [1] (d) Tax revenue may increase
  31. [1] (d) enabling government to spend more on e.g. infrastructure
  32. [1] (d) A rise in the supply of gold may reduce its price
  33. [1] (d) reduce revenue
  34. [1] (d) reduce exports
  35. [1] (d) External costs may be created
  36. [1] (d) damage to the natural environment / pollution
  37. [1] (d) The industry may experience (external) diseconomies of scale
  38. [1] (d) higher average cost
  39. [1] (d) example of an external economy
  40. [1] (d) Mining is a dangerous occupation
  41. [1] (d) wages may be low as primary sector
  42. [1] (d) jobs may be unskilled
  43. [1] (d) Resource of gold may be depleted
  44. [1] (d) stopping future generations being able to take advantage of them
  45. [1] (d) It will be less beneficial if other gold producing countries are increasing their output

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About this question

Topic
Economic development, O-Level Economics (syllabus 2281). Structured question, 20 marks.
Source
O-Level Economics, Oct/Nov 2019 Paper 2 Variant 2, question 4.

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