2012 RVHS EC 8819

Name:_________________________ Class: ______ This document consists of 8 printed pages. [Turn over ECONOMICS 8819/01 Paper 1 10 September 2012 3 hours Additional Materials: Answer Paper READ THESE INSTRUCTIONS FIRST Write your index number and name on all the work you hand in. Write in dark blue or black pen on both sides of the paper. You may use a soft pencil for any diagrams, graphs or rough working. Do not use staples, paper clips, highlighters, glue or correction fluid. Section A Answer all questions. Section B Answer one question. At the end of the examination, fasten your answers for each question separately. The number of marks is given in brackets [ ] at the end of each question or part question. RIVER VALLEY HIGH SCHOOL YEAR 6 Preliminary Year Examination in preparation for General Certificate of Education Advanced Level Higher 1

2 © RVHS 2012 8819/01 Section A Answer all questions in this section. Question 1 Rare Earth Minerals Extract 1: Value of China’s rare earth exports rockets China's exports of vital rare earth minerals used for numerous high -tech goods slipped almost one-tenth last year but the overall value rocketed as quota cuts lifted international prices. China, which produces about 97 per cent of the global supply of the minerals, cut export quotas for the minerals by 40 per cent last year, a move that alarmed buyers and trading partners. Compared to the first half of last year , China will be cutting export quotas by 35 per cent for the first half of 2011. China says the quota cuts will prevent reckless mining of deposits. China is also stepping up its controls over rare earth mining and plans to release new industry standards to combat pollution in its mining industries. China's moves have raised objections from major trading partners such as the United States, European Union and Japan. The U S Trade Representative office threatened last month to take China to the World Trade Organization (WTO) about its export restraints. With these export restraints, 17 elements , which are critical for the manufacturing of smartphones, computers, wind turbines an d hybrid cars in the US and Western countries, have been identified by analysts to face a global supply crunch as demand swells. Source: Reuters, 19 January 2011 Extract 2: Global suppliers respond to China's rare earth policies Since China set quotas to restrict its rare earth exports, global suppliers have made considerable headway in reducing dependence on Chinese supply. For example, US-based Molycorp MCP has begun pr oduction at its California mine and Avalon Rare Metals AVL is developing a deposit in Canada's Northwest Territories. Japan and Australia have also started mine production and are considering reopening mines. These responses have resulted in rising private s