Explanation​:
Sustainable development is defined as development that meets the needs of present generations without compromising the needs of future generations.

Options A, B, and D are incorrect:
Option A: as it doesn't mention the needs of future generations
Option B: as it doesn't mention the needs of present generations
Option D: as it does state that the needs of future generations are met but at the cost of the present generations

Explanation​:
The Marshall-Lerner condition (MLC) states that if the sum of elasticities of demand for exports and imports exceeds 1, currency depreciation will improve the BOT.

Options A, C, and D are incorrect as they don't satisfy the MLC:

• Option A: PEDx +PEDm = 0.9
• Option C: PEDx +PEDm =1
• Option D: PEDx +PEDm =1

Explanation​:
Common markets are trading blocs that feature:

• common external tariffs for non-member countries
• removal of trade barriers among member countries
• free movement of goods, labour, capital, and technology

(Choice B) Customs unions do not allow free movement of labour and capital
(Choice C) Monetary unions also have a common currency
(Choice D) Free trade areas do not include common external tariffs or free movement of goods, labour, capital and technology

Explanation​:
If a country has a persistent current account surplus, its exports are greater than its imports. Thus, the demand for currency exceeds its supply, leading to its appreciation.

These answer options indicate the consequences of a persistent current account surplus.

• Option B: A persistent current account surplus implies a financial account deficit, implying that the currency is leaving the country and hence low domestic investment.
• Option C: A persistent current account surplus implies higher exports and hence a low level of domestic consumption.
• Option D: A current account surplus leads to an appreciation of the currency, making the exports costly and reducing competitiveness.

Explanation​:
Choices A, B, and C are considered when GDP per capita is adjusted for purchasing power parity.

Differences in income distribution across the population are not considered.

Explanation​:
There are 17 SDGs laid down by the United Nations in 2015 which need to be attained within 15 years i.e. by 2030.

Options A, B, and C are incorrect.

Explanation​:
Choice (I) When the peso depreciates, Filpino exports become relatively cheaper, while imports become relatively more expensive. An increase in net exports shifts the aggregate demand curve to the right causing demand-pull inflation.

Choice (II) An increase in the cost of imported inputs increases production costs, shifting the short-run aggregate supply curve to the left, increasing the average price level and decreasing real GDP in equilibrium.

Choice (III) Depreciation should improve the trade balance, increasing aggregate demand.

Choice (IV) Depreciation raises the cost of imported inputs, decreasing aggregate supply.

Explanation​:
Trade diversion happens when the formation of a trading bloc shifts production from a low-cost producer to a high-cost producer. For example, joining a customs union can require a common external tariff, raising the price of imports from low-cost producers. As a result, trade diverts to higher cost members of the customs union.

Choice B is incorrect because trade creation happens when the entry of a country into a trading bloc shifts production from a high-cost producer to a low-cost producer.

These answer choices do not specifically address the impact of joining trading blocs:

• Choice C refers to comparative advantage which is the reason production costs are high or low. It does not explain why production shifts from one producer to another.
• Choice D refers to increased competition, but production moving from low-cost to high-cost producers results from reduced competition.

Explanation​:
Devaluing the currency would increase the volume of exports and decrease the volume of imports. Assuming the Marshall-Lerner condition is met, this will increase the value of (X-M), which increases AD, which increases employment.

Choice A is incorrect as stimulating AD will increase the price level.

Choice B is incorrect as there is no direct relationship between currency value and income/wealth inequality.

Choice D is incorrect as devaluing the currency directly increases export volume and reduces import volume.

Explanation​:
Choice D is correct because although environmental regulations increase costs and create bureaucratic obstacles for businesses, they can spur innovation and encourage sustainable practices, leading to long-term economic advantages.

Choice A is incorrect because when land rights are lacking or insecure, individuals may face difficulties in accessing housing and food production.

Choice B is incorrect because if the poorest of the poor are excluded from accessing credit, they will struggle to generate economic activity.

Choice C is incorrect because women and girls facing discrimination will have limited economic opportunities in terms of education, health, work, and access to finance, contributing to greater poverty.

Explanation​:
Statement I: Trading partners often retaliate with their own forms of trade protection and this may set off a trade war.

Statement II: Tariffs and other forms of trade protection often lead to higher prices and create a welfare loss, thus resulting in an inefficient global allocation of resources.

Statement III: Protecting domestic jobs is a commonly cited argument for trade protection, because competition against lower-priced imports can lead to job losses in domestic industries.

Statement IV: If trading partners retaliate with their own trade protection measures then the country’s exports will be more expensive and less competitive, not more competitive.

Explanation​:  D is the incorrect statement. Foreign investors buy more Malaysian investments due to the increased interest rates. Consequently, the supply of foreign currency increases (S1​ to S2​) as they exchange foreign currencies for Malaysian ringgit.

A and B are consistent with a rise in Malaysian interest rates. The cost of loanable funds is interest rates; increased interest rates disincentivise borrowing by Malaysian firms and households, leading to a decline in investment and consumption expenditures.

C is consistent with the view that British investors are attracted to higher interest rates because of higher investment returns.

Explanation​:
When a tariff is imposed:

• The domestic quantity supplied is at the intersection of the SdomesticSdomestic​ and the Sworld+tariffSworld+tariff​ curves (125 000 units).
• The domestic quantity demanded is at the intersection of the DdomesticDdomestic​ and the Sworld+tariffSworld+tariff​ curves (275 000 units).
• The quantity of imports is the difference between domestic quantity demanded and supplied (275 000 $-$ 125 000 = 150 000 units).

Choices A, B, and D are incorrect because they confuse pre-tariff figures with post-tariff figures for at least one of the variables.

Explanation​:
The current account is the sum of the following values:

• exported goods - imported goods
• exported services - imported services
• net current transfers
• net incomes

Plugging in the given values:

Balance on current account = 450 −120−500 = −$170 million

The following options apply the formula incorrectly and include the capital transfers (a component of the capital account):

• Option B is calculated as 450−500+120+45
• Option C is calculated as 450−120+45
• Option D is calculated as 450−120−500+45

Explanation​:
After implementing the quota, the consumer surplus decreases by $b+d+e+g+h+i$. Area $b$ is taken by domestic producers. Area $d+e+g$ is taken by importing (foreign) producers. This leaves $h+i$ as the deadweight loss.

Explanation​:
Statement I: tariffs in this scenario will be an anti-dumping measure to counter Protopia’s dumping of its products at below-cost prices.

Statement II: Econland’s tariffs are a response to Protopia’s unfair competition, and many economists would argue that tariffs in this case are justifiable.

Statement III: Econland’s tariffs are used to counter Protopia’s dumping and will thus protect domestic jobs in those industries harmed by Protopia’s actions.

Statement IV: Trade protection leads to a misallocation of resources, even when in response to dumping by a trade partner. Countries can utilize diplomacy and political pressure to prevent dumping, rather than resort to tariffs.

Explanation​:
Infant industries are at nascent stages of development. To withstand competition, they need to be protected. Hence, free trade hampers their development as they cannot compete successfully against established firms in other countries.

Options A, B, and D are correct.

Option A: as free trade helps countries to import a large variety of goods which increases the choice for consumers.

Option B: as countries can import resources which are not available domestically.

Option D: as countries can specialise in the production of commodities in which they have a comparative advantage leading to efficient allocation of resources.

Explanation​:
Even though MDCs generally have higher resource consumption which tends to threaten sustainability, they also have better infrastructure and technology, stricter environmental regulations, and greater education and awareness. Therefore LDCs tend to be less sustainable than MDCs.

Choices A and B do not correctly compare LDCs and MDCs. Choice D is incorrect because sustainability is a key factor differentiating economic growth from economic development.

Explanation​:
Interventionist supply-side policies may be a burden on the government budget but they often lead to a more equitable distribution of income, and less economic inequality.

Choices A, C, and D are possible drawbacks of such policies: they are expensive and may place an unsustainable burden on national debt, they involve long time-lags, and the increased government spending may create inflationary pressures in the economy.

Explanation​:
Revaluing a currency can improve a nation's standard of living, as a stronger currency can purchase more imports, the consumption of which increase living standards.

Choice A is wrong as devaluation is expansionary, which means it would cause demand-pull inflation.

Choice B is wrong as revaluation is contractionary, which means unemployment would increase as a result.

Choice C is wrong as devaluation would increase net exports, which would increase a current account surplus.

Explanation​: 

The above green area is the deadweight loss incurred due to the quota. When the quota is removed, overall economic welfare increases by that amount.

Choice B is wrong, as domestic consumers pay PWORLDPWORLD​ after the quota is eliminated.

Choice C is wrong, as the domestic consumer surplus decreases by the blue area.

Choice D is wrong, as the value of net exports should decrease, as the country imports more now (Q1Q5>Q1Q3).

Explanation​:
Statement I: Debt servicing refers to the required regular loan payments needed to cover the interest and principal repayments. Acquiring new debt to service outstanding debt compounds the problem by increasing the total amount of debt owed and the interest payments.

Statement II: Governments cannot sustainably finance their annual expenditures by borrowing money. Funding must ideally come from tax revenues.

Statement III: When a country lacks funding for human and physical capital investments, it may resort to borrowing money to finance long-term investments as they have the potential to increase the country's revenue and income, which could be used to pay off its debts in the future.

Explanation​:
A deficit in the current account implies that outflows exceed inflows. This leads to the supply of currency being greater than its demand.

Consequently, in a floating exchange rate system$\text{—}$where demand and supply for the currency determine the exchange rate$\text{—}$the exchange rate depreciates.

Options B, C, and D are incorrect:

• Option B, as currency appreciates if there is a surplus in the current account
• Option C, as the exchange rate remains unchanged under a fixed exchange rate system
• Option D, as a deficit on the current account causes the currency to depreciate

Explanation​:
Choice D is correct because the government’s spending on education and health—two factors that affect human capital—has increased.

Choice A is incorrect because higher HDI values reflect an improvement in a nation's economic development.

Choice B is incorrect because a higher HDI ranking suggests a worsening in a nation's economic development compared to other nations.

Choice C is incorrect because a lower Gini coefficient indicates an improvement in income inequality.