RI Y6 H2 Key Economic Indicators Tutorial Answers 2024

RAFFLES INSTITUTION H2 Economics

RAFFLES KEI – CASE STUDY 1 2015 2016 2017 2018 2019 GDP per capita (current, USD) 1248.5 1401.6 1563.9 1698.4 1855.7 GDP per capita (current, PPP USD) 3555.5 3849.1 4161.1 4546.2 4950.7 Real GDP Growth Rate (%) 6.6 7.1 7.3 7.9 8.2 Unemployment Rate (%) 4.4 4.3 4.4 4.3 4.2 Inflation Rate (%) 6.4 5.9 5.4 5.8 5.5 Current Account Balance (billion USD) 2579.6 931.5 -5985.0 -7592.9 -3087.0 Official Exchange Rate (taka/USD) 77.8 78.4 80.6 83.7 85.5

RAFFLES KEI – CASE STUDY 1 a) With reference to Table 1 above, in which year was real GDP highest in Bangladesh? [1] b) Explain why the values of GDP/capita (current, USD) are lower than GDP/capita (current, PPP USD) from 2015 to 2019. [3] 1st mark: What is PPP exchange rate? PPP exchange rate equalises the purchasing power of different currencies, allowing the currency of one country to be converted into that of another country to buy the same amount of goods and services in the country. 2nd mark: What does PPP try to capture? It adjusts for differences in cost of living between Bangladesh and the US. 3rd mark: Why it shows lower value when using official exchange rate? US$1855.70 can buy US$4950.70 worth of goods. Lower cost of living.

RAFFLES KEI – CASE STUDY 1 c) Describe the change in price level in Bangladesh between 2015 and 2019. [2) - Prices in Bangladesh generally increased between 2015 and 2019. [1m] - However, the prices generally increased at a decreasing rate during the period (disinflation). [1m] D) State what happened to the Bangladeshi taka between 2015 and 2019. [2] - The taka generally depreciated against the USD between 2015 and 2019. [1m] - It depreciated the most between 2017 and 2018. [1m]

RAFFLES KEI – CASE STUDY 2 a) Compare the changes in real GDP of Venezuela and Colombia between 2012 and 2018. [2] 1 Similarity, 1 Difference

RAFFLES KEI – CASE STUDY 2 a) Compare the changes in real GDP of Venezuela and Colombia between 2012 and 2018. [2] Difference: Venezuela – Fell, Colombia – rose Similarity: 2012-2013 – both rise 0%

RAFFLES KEI – CASE STUDY 2 b) Describe the trend in GDP growth rate of Iran between 2001 and 2017. [2] General trend: V olatileHigh 13%, low -7.5%, but mostly positive Anomaly: Negative in 2012 and 2015.

RAFFLES KEI – CASE STUDY 3 Compare the change in rate of inflation and the consumer prices for Nigeria and Saudi Arabia between 2017 and 2019. [2] Similarity, Difference but also 2 different aspects – rate of change vs absolute. Rate of change – Similarity – both see a fall in inflation rate from 2017-2019 Difference – Consumer prices rise (Nigeria), while it fell in Saudi Arabia. Year Nigeria Saudi Arabia 2014 8.1 2.2 2015 9.0 1.2 2016 15.7 2.1 2017 16.5 -1.0 2018 12.1 2.6 2019 11.4 -2.1

RAFFLES KEI – CASE STUDY 4 With reference to Table 3, compare the U.S balance of trade in goods with China in 2014 and 2019.[2] When assessing BOT – always note whether it is in surplus or deficit, then direction of change. Similarity – both years show deficit. Difference – 2019, deficit was larger. Year U.S. imports from China (USD billions) U.S. exports to China (USD billions) 2014 468 124 2015 483 116 2016 463 116 2017 505 130 2018 540 120 2019 452 106

RAFFLES KEI – CASE STUDY 5 a) Compare Singapore’s economic performance from 2019 to 2021. GDP growth 1.3% and 7.6% What does it imply? 2019 2020 2021 Real GDP, $million (2015 prices) 480,984.6 461,056.9 496,161.6 GDP growth, % (year-on-year) 1.3 -4.1 7.6% CPI (2019 Base year) 100 99.8 102.1 Inflation rate % 0.6 -0.2 2.3 Unemployment rate, % 3.0 3.8 3.4 Balance of Trade position, $million 147,216.2 151,047.4 167,265.7