Question:

5 In 2019, China’s economic growth rate was 6.1% and Chinese households increased their
spending. More Chinese people attended sports events and the earnings of top sportspeople
increased. China exported more despite a rise in tariffs on some of its products. For example, the
US imposed higher tariffs on the imports of Chinese tea and coffee.
(a) Identify the opportunity cost of households spending their income and the opportunity cost of
Chinese firms exporting goods and services. [2]
(b) Explain two reasons why some top sportspeople have high earnings. [4]
(c) Analyse the reasons for imposing tariffs on imports. [6]
(d) Discuss whether or not a country with a high economic growth rate will have a deficit on the
current account of its balance of payments. [8]

Sample Answers: