Economics Paper 2, WASSCE (SC), 2020

Question 2

 

Figure 1 below represents the production possibility curve of a nation. Use it to answer the questions that follow.

 

(a) What is the opportunity cost of:
(i)  producing 30 units of cocoa;
(ii) increasing textile production from 30 to 40 bales?
(b) Interpret the following points as found in the graph:
(i)  point Y;
(ii) point G;
(iii) point X.
(c) List three conditions that can enable the nation to produce at point X.
(d) State two basic economic concepts illustrated in the diagram above.
(e) (i) Define production possibility curve.
(ii) What does the slope of the production possibility curve indicate?

  Observation

 

This is the alternative data response question and it was attempted by few candidates, majority of whom scored average marks. The question required candidates to determine the opportunity cost of producing 30 units of cocoa and increasing textile production from 30 to 40 bales in the (a) part, interpret points Y,G and X found in the diagram in the (b) part, list three conditions that can enable the nation to produce at point X in the (c) part, state two basic economic concepts illustrated in the diagram, define production possibility curve and identify what the slope of the production possibility curve indicates in the (d) and (e) parts of the question respectively. Most of the candidates could not determine the opportunity cost of producing 30 units of cocoa and increasing textile production from 30 to 40 bales in the (a) part, majority were able to interpret points Y, G and X found in the figure in the (b) part, but only few candidates could give the conditions that can enable the nation to produce at point X in the (c) part. Most of the candidates were able to mention one of the basic concepts illustrated in the diagram and defined production possibility curve correctly, but only few of them were able to state what the slope of the production possibility curve indicated in the (d) and (e) parts of the question respectively.

 

The candidates were expected to provide the following answers to obtain the maximum    marks.

(a)(i)    The opportunity cost of producing 30 tons of cocoa is sacrificing 60 bales of textiles.
(ii)   The opportunity cost of increasing textile production from 30 to 40 bales is sacrificing/reducing cocoa production by 5 tons or from 25 to 20 tons or (25-20).

 

(b)(i)    Point Y represents underemployment of resources since it lies within the curve.
(ii)   Point G represents full employment of resources because it lies on the curve.
(iii)  Point X represents an unattainable point because it lies outside the curve.

 

(c)(i)    Use of advanced technology.
(ii)   Research and Inventions.
(iii)  New discovery of resources.
(iv)  Increased investment.
(v)   Reduction in waste or misallocation of resources.
(vi)  Growth in the economy.
(vii) Human resource development.

 

(d)       Scarcity, choice, opportunity cost.

 

(e)(i)    Production possibility curve is a curve that shows the various combinations of goods and services that a country can produce, using available resources and the most efficient production technique.

(ii)   The slope of the production possibility curve indicates that to produce more of one commodity (textiles), units of the other commodity (cocoa) must be sacrificed or there is opportunity cost involved in the production of textile and cocoa.