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O-LevelEconomicsEconomic development2281/21 · May/June 2015 · Q620 Marks

About 30% of Nigeria's labour force is employed in agriculture but the country still spends more than US$12 billion a year importing food. The Nigerian Government is seeking to reduce the imports of food. With a high birth rate and many small farms, this may be difficult to achieve.

  1. (a)Define 'birth rate'.[2]
  2. (b)Explain two causes of a high birth rate.[4]
  3. (c)Analyse how an increase in the size of farms may affect the cost of producing food.[6]
  4. (d)Discuss whether a reduction in its imports will always benefit an economy.[8]

Mark scheme

Marking points from the official mark scheme (May/June 2015). The mark or mark type is shown in brackets.

  1. [2] the number of births per 1,000 of the country's population per year
  2. [1] the number of births per 1,000 of the country's population
  3. [1] a high infant mortality rate
  4. [1] people having a high number of children not expecting all of them to live
  5. [1] a lack of financial support for the elderly
  6. [1] people having children to support them in old age
  7. [1] women marrying at a young age
  8. [1] giving them longer time in which to have children
  9. [1] a young population
  10. [1] with a high proportion of people of child bearing age
  11. [1] a lack of availability/willingness to use contraception
  12. [1] resulting in more births than planned
  13. [1] not many women working
  14. [1] not restricting the number of children they have in order to follow a career
  15. [1] a lack of education
  16. [1] reduces knowledge of contraception/cost of bringing up children/proportion of women working
  17. [1] government incentives to have children
  18. [1] high state benefits would increase willingness and ability of people to have children
  19. [1] larger farms may produce higher output
  20. [1] this will increase total cost
  21. [1] larger farms may be able to take advantage of economies of scale
  22. [2] examples of economies of scale available to farmers e.g. buying (purchasing seed in bulk), technical (using e.g. combine harvesters), managerial (specialist workers e.g. shepherds) up to
  23. [1] will lower average costs
  24. [1] larger farms may experience diseconomies of scale
  25. [1] examples e.g. worse labour relations
  26. [1] will increase average costs
  27. [1] larger farms are likely to have higher fixed and variable costs
  28. [1] but their average fixed costs are likely to be lower
  29. [1] as these costs will be spread over a higher output
  30. [1] their average variable costs may be lower due to economies of scale/or higher due to diseconomies of scale
  31. [1] a reduction in imports may improve the trade in goods/trade in goods and services balance
  32. [1] this will improve the current account position/reduce a current account deficit
  33. [1] this may reduce a country's debts
  34. [1] avoid downward pressure on the exchange rate
  35. [1] spending on imports may be replaced by spending on domestically produced products
  36. [1] this would increase the country's output/cause economic growth
  37. [1] this would increase demand for labour
  38. [1] raise employment/reduce unemployment
  39. [1] increase incomes and living standards
  40. [1] fewer imports may enable infant industries to grow
  41. [1] may protect declining strategic industries
  42. [1] may prevent dumping
  43. [1] explanation of what is meant by dumping
  44. [1] imports of capital goods/raw materials may decline
  45. [1] these might be cheaper/lower quality than domestically produced capital goods and/or raw materials
  46. [1] this will raise costs of production
  47. [1] make the country's products less internationally competitive
  48. [1] lower output/reduce economic growth
  49. [1] worsen the current account position
  50. [1] raise unemployment
  51. [1] fewer imports may reduce choice
  52. [1] reduce competition
  53. [1] may raise prices
  54. [1] lower quality of people's lives
  55. [1] exports may be falling by more than imports
  56. [1] so current account position may be worsening
  57. [1] quantity of imports may be falling but value of imports may be rising
  58. [1] if the reduction is caused by protectionist measures
  59. [1] this would reduce benefits of free trade

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About this question

Topic
Economic development, O-Level Economics (syllabus 2281). Structured question, 20 marks.
Source
O-Level Economics, May/June 2015 Paper 2 Variant 1, question 6.

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