2017年5月IB经济SL真题下载-Paper2
1. Study the extract below and answer the questions that follow.
Relief as Kenya raises tariff for steel and iron imports
(1)Steel manufacturers in Kenya are set to benefit as the government moves to protect the local manufacturing industry from cheap steel and iron imports.
(2)In 2014 a government official announced an increased tariff on steel and iron imports.
“Our steel mills are closing down due to unfair competition from cheaper imported iron
and steel products,” he explained. “To protect and create more jobs in the iron and steel industries, tariffs on a wide range of imported iron and steel products will be increased from 0 % and 10 % to 25 %,” he said. The government official further stated that as well as protecting the local industries from cheaper imports, the protectionist measures would raise an additional 2.6 billion Kenyan shillings (Kenya’s currency) annually in government revenue and support economic growth.
(3)The potential of local industries to expand and create jobs through trade has been held back by a number of administrative barriers. The government remains focused on improving the business environment. Over the past six months, the government has made it easier to register a company and trade across borders. The time taken to move goods out of the main harbour has fallen sharply; non-tariff barriers such as roadblocks have also been reduced. Importers of refined industrial sugar and wheat are also pleased after the government scrapped requirements to pay unnecessary administrative charges.
(4)However, there is a belief among manufacturers that there is a need for more deregulation to lower their costs of production and in effect reduce the cost of doing business.
Kenya sees gross domestic product (GDP) growth picking up but current account a concern
(5)Good economic growth rates in neighbouring countries like Uganda help to boost Kenyan exports, particularly for agriculture that makes up nearly a quarter of the Kenyan economy. The government suggests that the main risks to growth are the slow performance of developed economies that are key export markets for Kenyan goods and services, and Kenya’s large and persistent current account deficit of over 10 % of gross domestic product (GDP) in the last three years. This is a major concern for sustained economic growth and the value of the Kenyan shilling.
(a) (i) Define the term tariff indicated in bold in the text (paragraph （2））
(ii) Define the term economic growth indicated in bold in the text (paragraph （2））
(b) Using an international trade diagram, explain the impact on the Kenyan government of implementing a tariff on steel imports.
(c) Using an exchange rate diagram, explain why a deficit in the current account may result in downward pressure on the Kenyan shilling (Kenya's currency) (paragraph (5)).
(d) Using information from the text/data and your knowledge of economics, evaluate the claim that trade protection measures will support economic growth in Kenya.
2. Study the extract below and answer the questions that follow.
Australian economy feels the effects of falling iron ore price
（1）Iron ore is Australia’s largest export and the double effect of slowing growth in China and higher levels of production in Australia has driven the price of iron ore lower. In addition, the Australian dollar (AU$) has experienced a 10 % depreciation against the US dollar (US$). These two factors combined have caused a dramatic worsening in the current account.
（2）Australian mining companies are losing significant revenue from falling commodity prices and this is further worsened by the rapidly depreciating currency. The Australian dollar traded at US$0.7375 on Wednesday, nearly at a six-year low.
（3）Australia recorded a monthly balance of trade deficit of AU$2.61 billion in May 2015, compared with a deficit of AU$1.61 billion a year earlier. The increasing deficit in Australia’s balance of trade is an indicator of potential declines in growth and employment, according to a foreign currency expert.
（4）The price of iron ore has fallen more than 67 % between February 2013 and July 2015. In Australia, falling iron ore prices create downward pressure on economic growth. Australia’s real gross domestic product (GDP) grew 2 % in 2015, down from 2.5 % in 2014. Some economists noted that falling commodity prices reduced Australia’s export revenues by more than 2 % of GDP in 2015.
（5）An expanding group of Australian-based economists argue that the central bank should further cut interest rates because of global economic uncertainty, falling commodity prices, weak consumer demand, and persistent weakness in non-mining sectors, such as tourism and education exports. Australia has been a popular destination for tourists and attracts many international students.
(a) (i) Define the term depreciation indicated in bold in the text (paragraph (1)).
(ii) Define the term current account indicated in bold in the text (paragraph (1)).
(b) Using an exchange rate diagram, explain why “slowing growth in China” may have caused a depreciation of the Australian dollar (paragraph (1)).
(c) Using a demand and supply diagram, explain why “the double effect of slowing growth in China and higher levels of production in Australia has driven the price of iron ore lower” (paragraph (1)).
(d) Using information from the text/data and your knowledge of economics, discuss the possible consequences for the Australian economy of the fall in the value of the Australian dollar.
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