Measuring Economic Development (DP IB Economics: HL)

Exam Questions

14 mins7 questions
12 marks

Text A, Paragraph 1
In a recent international economic review, various developing countries, including those in Asia, have been analysing their economic performance. Policymakers are keen to assess the long-term effects of increasing cross-border trade and investment on their overall economic indicators, including gross national income (GNI).


Define the term gross national income (GNI) as indicated in (Text A, Paragraph 1).

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22 marks

Text B, Paragraph 1
Governments in various African nations have been discussing how to improve their rankings in global development measures. They are evaluating current strategies in sectors like healthcare, education, and economic stability, all of which are key factors in their Human Development Index (HDI).

Define the term Human Development Index (HDI) as indicated in (Text B, Paragraph 1).

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32 marks

Text C, Paragraph 2
Countries like Sweden have been commended for their strong performance on the Gender Inequality Index (GII), reflecting progress in promoting gender equality in various sectors of the economy. Recent policy initiatives have focused on empowering women in the workforce.


Define the term Gender Inequality Index (GII) as indicated in (Text C, Paragraph 2).

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42 marks

Text D, Paragraph 2
Recent studies in Asia have explored the value of using composite indicators like the Human Development Index (HDI) to provide a fuller picture of a country’s economic and social progress. These measures allow countries to evaluate multiple dimensions of development simultaneously.

Outline one purpose of using composite indicators as indicated in bold (Text D, Paragraph 2).

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52 marks

Text B, Paragraph 3
While the HDI is widely used, researchers in Eastern Europe are exploring its limitations, particularly when it comes to capturing inequalities within countries. These discussions are part of a broader effort to improve development metrics for a more complete understanding of national progress.

State two limitations of the Human Development Index (HDI) as indicated in bold (Text B, Paragraph 3).

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62 marks

Text D, Paragraph 3
In comparing different economies, several nations have looked at both GNI and GDP as part of their analyses. Researchers are working to better understand the implications of these two indicators for policy planning, particularly in relation to foreign investment.

Outline the difference between gross national income (GNI) and gross domestic product (GDP) as indicated in bold (Text D, Paragraph 3).

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72 marks

Text D, Paragraph 1
Economic planners across Europe have been adjusting their models to better compare living standards between countries. Discussions have focused on how these adjustments may affect future policy directions in trade and development, with a particular emphasis on purchasing power parity (PPP).

Define the term purchasing power parity (PPP) as indicated in (Text D, Paragraph 1).

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