IB Economics HL 2.10.2 Hl Responses to Asymmetric Information Topic Practice

Answers may include:
- Terminology: Asymmetric information, adverse selection, moral hazard.
- Diagram: Not needed for this question.
- Theory: Candidates should consider government responses to markets in which asymmetric information is considered problematic such as legislation and regulation, the provision of information. Candidates might also consider private responses such as signalling and screening where a government decides not to intervene.
- Synthesis (evaluate): An evaluation of the different policies available to the government when there is asymmetric information in the context of the examples offered by the candidate. Candidates might conclude that the best course of government action is to do nothing and allow private responses to the asymmetric information. Or, alternatively, that government action in certain situations may be imperative.
- Example(s): A relevant real-world example(s) in which asymmetric information exists.

Assessment Criteria

Marks ..... Level descriptor
0:
- The work does not reach a standard described by the descriptors below.
1-3:
- The response indicates little understanding of the specific demands of the question.
- Economic theory is stated but it is not relevant.
- Economic terms are stated but they are not relevant.
- The response contains no evidence of synthesis or evaluation.
- A real-world example(s) is identified but it is irrelevant.
4-6:
- The response indicates some understanding of the specific demands of the question.
- Relevant economic theory is described.
- Some relevant economic terms are included.
- The response contains evidence of superficial synthesis or evaluation.
- A relevant real-world example(s) is identified.
7-9:
- The response indicates understanding of the specific demands of the question, but these demands are only partially addressed.
- Relevant economic theory is partly explained.
- Some relevant economic terms are used appropriately.
- Where appropriate, relevant diagram(s) are included.
- The response contains evidence of appropriate synthesis or evaluation but lacks balance.
- A relevant real-world example(s) is identified and partly developed in the context of the question.
10-12:
- The specific demands of the question are understood and addressed.
- Relevant economic theory is explained.
- Relevant economic terms are used mostly appropriately.
- Where appropriate, relevant diagram(s) are included and explained.
- The response contains evidence of appropriate synthesis or evaluation that is mostly balanced.
- A relevant real-world example(s) is identified and developed in the context of the question.
13-15:
- The specific demands of the question are understood and addressed.
- Relevant economic theory is fully explained.
- Relevant economic terms are used appropriately throughout the response.
- Where appropriate, relevant diagram(s) are included and fully explained.
- The response contains evidence of effective and balanced synthesis or evaluation.
- A relevant real-world example(s) is identified and fully developed to support the argument.