A government is considering whether to build a deep-water port. Supporters expect more global trade and jobs. Opponents argue that public funds could instea...
Question 1 Report
A government is considering whether to build a deep-water port. Supporters expect more global trade and jobs. Opponents argue that public funds could instead improve local schools, and construction may damage nearby mangroves.
(a) Analyse the possible benefits of building the port. [3]
(b) Analyse the possible costs of building the port. [3]
(c) Assess whether the government should allocate public funds to the port. [3]
Answer Details
(a) A deep-water port may reduce transport costs for importing and exporting firms. [1] Lower costs can make trade easier and increase output. [1] Higher output may then create jobs, wages and tax revenue. [1]
(b) Public money spent on the port has an opportunity cost: fewer resources may be available to improve local schools. [1] Construction may damage mangroves, reducing biodiversity or natural flood protection. [1] Pollution and construction disruption may also impose external costs on nearby residents. [1]
(c) The government should support the port only if its long-term trade, employment and tax benefits exceed its construction costs, environmental damage and the opportunity cost of public funds. [1] It should consider both the scale of mangrove damage and whether it can be reduced. [1] It should also compare the port’s social return with the possible social return from spending the same funds on schools. [1]
Download The App On Google Playstore
Everything you need to excel in your exams
