our name here

write y

-
pearson Edexcel ·
international GCSE

conom1cs •

paper 1

Friday 20 January 2017 - Morning Paper Reference

Time: 2 hours 30 minutes
4EC0/01
y0 u do not need any other materials. Total Marks

Instructions
• Use black ink or ball-point pen.
• Fill in the boxes at the top of this page with your name,
centre number and candidate number.
• Answer all questions.
• Answer the questions in the spaces provided
- there may be more space than you need.

Information
• The total mark for this paper is 120.
• The marks for each question are shown in brackets .
- use this as a guide as to how much time to spend on each question.
• Calculators may be used.
I
I I
Advice , I .
• R d tart to answer it.
ea each question carefully before you s
• Try to answer every question. nd
• Check your answers if you have time at the e ·

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 Sorn Answer ALL quest;ons. wr;te your answers in tne spam pro .
• quest· '-••• _.---- 1
a nswe r, ions must be answered with a cross ;nth• box Ci!l. Ifnew
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chan · .--- 9 11 - - -1- - - - - -
(a) F;g u put • Une through the box S and then mark. your ltli , 1 In \91 lh',ntch'"'" gove_mment
,t wouldlimit,
;e
. . announced , d 0,,1,- -----
201 1 a shows the age d;stribut;on of the populaUOn '" Chma ;n the ye , 90•""~1,o>s
th. 0 ,;fY of, an age;ng pop,lat1::" "'""'"
prnblem faced b,tlin. 9
°"" liild
'"'
- ,.°s°"'' '°''" • \-
1 and 2030 esUmated (est). " Sl°" e P' 00 """'<h;1/""0201stli
1 ry that
Age dlstr;butlon of the population in China 1h1 fde~ an age;ng •popula\\on. e °'"•ment ol rnay •
result
- 1

\n\;_
,g,~~ , D -~C>'<~{.'\~~.s.oo~~- ) I

80 ~j ~1~~1@.)~01~'-- ~ -,, .
70 r,111" ) identify one policy,
h apartblfrom allowin9 coup\ - ·
co uld overcome t e pro em you have .'dentifiedes toinhave
\a)\ii~ore children, that
\
I 60

'
C:
.gro so \nq .~.-~ ~-- ~ -~ -.:.
5.40
0
a.
o 30 -------·· --
-·~- ----· "'
0

20

10
0 -I I
65+
...J
15-64
0-14
Age groups

\Source: http://www.nationmaster.com/country-info/proft\,
China/People/ Age-distributionm

I Figure la

I
l 1
The dat• '" c,-.. -- ' -
- -- :a in Figure
,hn••<
I Cl :,11v••
that ch;na ;s experiencing an ageing populaUon
...

(i) With reference to Figure 1a, explain the term 'ageing population'.

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 ears China has become th
(bl tn receotY o'i'I compete with rice as e World's I
potatoes o a rnajor Pa argest Pot
·ch of the following describes th rt of the C~to Produ
(i) W I e relati inese d. cer.
onship b iet.
h
"• fheY are complements etween POtat oes and nee?
.

[] 'l)
fheY are substitutes
8
O , fheY are unrelated
O
O
fheY must be grown together

(ii) If potatoes have a price elasticity of dern ,

1
-
- revenue when the price of potat oesand
total in creasesi7' thxpanIain
greater.. E 1, what happe
ns to
• , ' . your answer

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Potatoes are used in the production of frozen trench fries which are increasin .

I Popularity in China as the number of fast food restaurants grows. g I~ ,

(iv) The elasticity of supply of frozen trench fries is Iikely to b~ mor~ elastic tha
i
N
th I • •
e e ast1c1ty of supply of fresh potatoes.
Do you agree with this stat
errienn
11

Give reasons for your answer. ·

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 1b below. • - I

Figure ' .. -- ·----- --· - · - - - ---

(cl s1udY . -· \~ ~ -o~ e elasticity o~~e_~nd_\
Type of good
- j -o.so \ l
. ~ rs
---r · - -· -··-----
Bread ........-
, +0.75
·--···------ \\
·for ca
Fue l , -
____-
--tI-------
I
- - ------..\..._ --- - -
+1.80 8
cakes ______ J_.------ - - -------...1___·------ - -
--- Figure 1b

the final column of Figure 1 b by inserting A, B or c to show the type

(i) cornpletde cribed by the income elasticity of demand.
of good es
the letters A, B and C more than once.
~um~u~ ,
ood that is a necessity
A: Norma I g

B: Norma I g
ood that is a luxury

c :Inferior good l3)

 th
(ii) Using the data in Figure 1b, draw and label a diagram to_ show e effeq 01
a recession on the market for cakes. Explain your reasoning.

Price

Quantity

1~~~\9}) \O-.%-½ 'l<\\~'"-ru<\~ \ · .

\ ~ -oil'\();~~~~~ ;\\I~\:
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- - - - - - - - - " ~_________JJ
(Ti~o~tal--··· =30 1
for Question 1_,,,
/ e three sectors: primary se
·es hav
-----------
, condary -
,,o
0
of111 .
le of an occupation in the t .
and t .
ertiary.
(a) A11 e~a111P ert1ary sect
·ve a~ or.
G
(i) I

. .. the percentage contribution t G

·· ·....... ... ·· .
hows b d' o ross D
. eza s f the cam o ,an economy and th omestic P
r,g"',n se'1or och sector in 2014. e Percentage o/°hduct (GDP)
of ea diO ea t e workforce
el11P Joye GDP and employment·. Cambodia 2014

60

so ---

40 ,,..
%of GDP
% 30
% of labour force

20 -

10 -

0 Secondary Tertiary
Primary
(Source: https://www.cia.gov/library/publications/the-world-fac tb oo k/ geos/cb.html)

Figure 2a

-
(ii) In which sector is productivity lowest? (1)

riJ A Primary
-
D

D
B Secondary

C Tertiary
-

I Ill lllll lllll 11111111111111111111111111111111111111

Turnover
-
 -
lI (iv) Identify and briefly explain two methods that could be used to increase
productivity in the primary sector.

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 (ii) Ide t"f . . . -t· ·
n I Yand briefly explain one fmanc1al and one non manc1a1 rn
government can use to encourage the growth of small firms. eth0 q~

Financial

i
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..... ........ .
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.... · ····· · · · t' n 2 - 30 marks) - -

... .... ................ .
(Total for aues io
----
······ --···· •....... . .... . ········ ···
- --- .
- . United Sta
of trade in
tes dollars (USD) in billio
~s
3 (a) Figure 3a shows the balance
for Brazil, 2013 and 20 14· 2014
2013
________ f .-- 242
225
- - SD (billions)

I
Visible imports U - - -
- - --
Visible exports
____
uso (billions) --
. daptedfr0fl1
,.
229

http://www.tradingeconornics
(Source. a
l Figure 3a

de in 2013 and 2014.

(i) Calculate the balance of tra '

2013 ·· ··•······ . .. ......... .. .. .. . . .

·········•··· ··
- LO~!) -~ ~ --
. .. . . . . . ····· ···················· .......... ·········· ..... ............ ···· ·····~...

................. ······· ....

2014
........••·····················:··· · ..... ·--
.... . .. ·· ··· ·· ······ . ... .
\N)\)\)~ ... .
·············· · ·· · · · ·· • • " '' '' '' ' ' ' ' .
'
. .. .... .. ········ ..... ... ····· .. I ce of trade from 2013 to 20J 4?
_(ii), What has happened to the ba an

-- A The balance of trade has stayed the same

B The balance of trade has worsened

- c ,The balance of trade has become more favourable

· · · ' h Ip to
(iii) Identify and briefly explain two ways m which a government can e
increase the exports of its country.

...... .... .... ..... ... ....... . .... ..... .... ... ... ··· ··-···· ······· ···••0, •· ······· ········ ············ ······ ··············• ..................................................................

•······················ ····· ···· ····· ··•···•····· ·· ···························· ········•·············· ·•···

. . ... ........................................ ·········

..... ..... .. ..... • •••• • •••• • • • OOO O• • • •••• • ••• Oo O• •• • • •• • • • ••• ••••• •• ••• •••• • •

···· ·•· .. ,, .... ..... .

. ..... .................. ...... .... ............... -
...~·-"
 ,.

__.,, ws the economic growth -------- f

3b shO o Brazil, 201
--.._
b) Figure Brazil's Ee 0-201 s (esr
onornic G iniated) •
. rowth .

9.0
s.O
7,0
6,0
5,0
4,0
0/o 3,0
2.0 -
1.0
0
2010
-1.0 .-·-·•·
-2.0
I

(Source: http:/'/www.foe us-economi

1
1
cs.com I countries/brazil)

Figure 3b
/ I

(i) Explain the relationship between real Gross D~mestic Prod uc t an d economic
.
I
growth.
(3!

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............................
.........................
···················................................................... ... .. .......... ..... ...... ........ ......... ... ... .... ............................ .

.. . . ted to happen to Brazil's

5t
(u) Using the data in Figure 3b, describe what was e 'ma
real Gross Domestic Product in 2015. (i)

l
 ti Ir - &6 - I

-- ... a s outweigh the disadvanta

1 Y
(111 ) The advantages of economic growth aw 9es.
Discuss.

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---.-----
the rate of inflation in 8 .
er 201 5 ra2,1 rose t
(c) In
octob 2003.
Novef11
ber
I ban
'k of Brazil decided to ma· .
inta,n int
o 9.9% th
' e high st
e rate sin
ce
-
ntra . . erest r
The ce the rate of interest is an inst ates at ahi h
easin9 rurnent of g level.
(I,·1 1ncr
A fiscal poli~Y 1
[]
8 r,10
r,etarY policy
-
O C supply side policy

. two functions of money.

--
(ii) identify
I
(2}
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... ) B . fly explain the effect of inflatio~ 011 one function of . . · · · · · - ..

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The following are main economic objectives for Jovernments:
1 11
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• reducing unemployment

• controlling inflation
• balancing the current account of the balance of payments
(1 l
(iv) Identify one other main economic .objective.

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To red uce inflation

· . the government of Brazil has increase d t he rate of ·interest
(v) As sess the rm
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in . 1s increase in ev,
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 rigure 4a shows the amoun t ui " ,~ .. -,. · to ot her LlJ'-'• .. from tore1 gn tourists visiting M ....
· ts going arne d alt ·1 , ...__
one'/ e the balance of payments as: a s shown. .........__
the expenditure of Maltese touns
Tourism: a M lta 2012- 2
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(illl 1v• vnt on
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1n Malta's tu
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. ·ble exports
v1SI
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. ·ble exports
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. ·ble imports
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1400000 0 . •ible imports
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1200000 to Malta

.... 1000000
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w 800000 from Malta

600000
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2013
2012
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(Source: http://www.independent.com.rnttarticles/2015-06-17 /local-n
Tour;sm-Author;ty-publlshes-stat;,t;cal-ceport-for-201 5_67' 3W6S/Ma1_
1374

Figure4a

(ii) With reference to the data in Figure 4a, compare the trends in expenditure
tourists to Malta with tourists from Malta.

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II (iv) Th. e advantages of a depreciation of a currency aIways ou t weigh
. the
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1 disadvantages. Do you agree? Give reasons for your answer.

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 11

go
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(b)
,_ba.1market as its econ~~~~e increasing

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the aid of
an ap
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9rovvth slo aniounts of su . .
bsidised steel onto the
-- -
governments steel subs·d ProPriat .
' y on th e d1agr
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quantity of China's exports of st I

s
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Quantity
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. steel onto the global market.

China has been accused of dumping

(ii) What is meant by the term 'dumping'? (2)

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(iii) Briefly explain one reason why China might have dumped stee/ onto
global market. the

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 ·v) Free trade is always benef·ICla
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(I Give reasons for your answe a country. Do you agree with this statement?
r.
(6)

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