Practise Cambridge IGCSE Economics by analysing living standards, poverty and income distribution and evaluating income and non-income indicators across contexts.
In 2022, more than a quarter of a million workers, including doctors, left Sri Lanka to work in other countries. This was largely due to economic problems, including an inflation rate of 50% and a concern that unemployment might rise. The Sri Lankan Government increased direct taxation. It also encouraged some public sector workers to work abroad temporarily. People who work abroad often send money home to relatives.
Explain two ways that money received from relatives working abroad could raise their families' living standards.
Logical explanation which might include:
Could spend more on food / buy more products / buy more basic necessities have higher purchasing power / more income / could increase overall spending (1) reduce poverty (1).
Could spend more on better quality food (1) improve nutrition / improve health (1).
Could spend money on education / training (1) increase earning potential / wages (1).
Could spend on healthcare (1) raise life expectancy (1). Could spend on housing (1) reduce illness (1).
May be able to afford luxuries (1) e.g. may be able to afford a holiday / car (1).
Could set up a small business (1) which could earn them an income (1)
Could pay off debts/reduce need to borrow/reduce cost of borrowing (1) reduce stress (1).
Could save more (1) earn interest / pay for e.g. healthcare/education of children in the future (1) Could work fewer hours / fewer jobs (1) less stress (1).
4
One mark each for each of two ways identified and one mark each for each of two explanations.
If more than two ways given, consider the first three.
No marks for why the money received may be large due to e.g. lower tax rates abroad, high exchange rate.