IB Economics www.tutor2u.

net
Mock IB Data Response Question
China's consumer prices fell by 1.5% in the year to April, fiures show, the thir! consecuti"e month of
!eclines. #he !rop came after foo! an! enery prices ease! from last year's hih le"els, an! followe!
annual falls of 1.2% in $arch an! 1.%% in &ebruary. &oo! prices were !own 1.'% in April from a year
ao.
A (ey factor was the !rop in the price of por(, which was !own 2).%% from a year earlier. In 2**),
shortaes ha! sent por( prices sharply hiher.
Costs for fuel an! raw materials were +.%% lower than the same perio! a year ao.
#he fall in prices ha! been e,pecte!.
-#he sharp rise in foo! prices in early 2**) an! subse.uent !eclines e,plain much of the year/on/year
fall in C0I inflation,- sai! 1in 2lrich, chairman of China e.uities at 10 $oran.
-3eflationary concerns appear to be subsi!in as the economy shows sins of reco"ery.-
#his recent !ata follows the news last wee( that China an! #aiwan ha"e sine! an areement to allow
in"estment across the #aiwan 4trait. In the past, while there has been a reat !eal of mainlan!
in"estment from #aiwanese firms, Chinese companies ha"e nee!e! permission from the #aiwanese
o"ernment to un!erta(e forein !irect in"estment in #aiwan.
#aiwan's economy went into recession late last year an! both si!es sai! they hope! their areements
woul! help both si!es to weather the economic storm.
Answer all questions
a5 3efine the followin terms in!icate! in bol! in the te,t6
i5 Inflation 728
ii5 9ecession 728
b52sin a !iaram e,plain what is meant by :ba!; !eflation 7<8
c5 2sin a supply an! !eman! !iaram e,plain why por( prices rose so sinificantly
in 2**) 7<8
!5 2sin information pro"i!e! an! your own (nowle!e of economics, e"aluate the
effecti"eness of forein !irect in"estment as a means of achie"in economic rowth
7)8
=#e,t a!apte! from http6>>news.bbc.co.u(>1>hi>business>)*<'2**.stm an!
http6>>news.bbc.co.u(>1>hi>business>)*1+*%).stm5
http6>>www.tutor2u.net>blo>in!e,.php>ib/!iploma>