About Living standards, population and development in O Level Economics
Living standards, population and development is one of the 8 main topics in our O Level Economics (Cambridge (CAIE) 2281) question bank, and about 10% of its real questions come from it. Tayyari Karo has 37 real questions on this topic from 2021 to 2026, from Paper 1, Paper 2; 31 are multiple choice and marked instantly, and the rest are structured questions with a model answer. By difficulty: 24 medium, 9 easy, 4 hard.
Work through the questions below, then open the explanation for each one. Redo the ones you missed a few days later.
Try 6 real questions
These are real past-paper questions. Think of your answer first, then open the explanation.
May/June 2026 · Paper 1 · Living standards, population and development
What is not likely to be used to measure the difference in the standard of living between countries?
- Gross Domestic Product per head
- Human Development Index
- the rate of interest
- the rate of poverty
Show answer and explanation
Answer: C. the rate of interest
GDP per head, HDI and poverty rates indicate living standards; the interest rate does not.
Oct/Nov 2025 · Paper 1 · Living standards, population and development
In many high-income economies, increasing income inequality has led to greater levels of poverty. Which combination of policies would aim to reduce income inequality?
- supply-side policy: create more competition; fiscal policy: decrease corporation tax
- supply-side policy: reduce the power of trade unions; fiscal policy: increase income tax
- supply-side policy: increase the national minimum wage; fiscal policy: increase inheritance tax
- supply-side policy: privatise more public sector firms; fiscal policy: increase sales tax
Show answer and explanation
Answer: C. supply-side policy: increase the national minimum wage; fiscal policy: increase inheritance tax
A higher minimum wage raises the pay of the lowest earners and inheritance tax reduces the transfer of wealth, so both narrow inequality.
May/June 2023 · Paper 1 · Living standards, population and development
Other things being equal, what will cause a population both to increase and to age?
- a fall in the birth rate
- a fall in the death rate
- a rise in both the birth rate and the death rate
- a rise in the death rate and a fall in the birth rate
Show answer and explanation
Answer: B. a fall in the death rate
A lower death rate means more people survive to old age, so the population grows and ages.
Oct/Nov 2023 · Paper 1 · Living standards, population and development
In some developing countries a large percentage of the population is involved in subsistence farming. What can be concluded from this?
- Each family will be able to produce enough to live on.
- Production is unlikely to be capital intensive.
- Production will be efficient.
- There will be a high level of trade.
Show answer and explanation
Answer: B. Production is unlikely to be capital intensive.
Subsistence farming uses mainly labour and simple tools because capital equipment is scarce and expensive.
May/June 2022 · Paper 1 · Living standards, population and development
What is likely to cause an immediate decrease in the size of the labour force?
- a fall in the average size of families
- a fall in the birth rate
- a reduction in the age of retirement
- an increase in net immigration
Show answer and explanation
Answer: C. a reduction in the age of retirement
Earlier retirement removes workers from the labour force straight away; birth rate changes take years.
May/June 2021 · Paper 1 · Living standards, population and development
The richest 60% of the population of a high-income economy received an increase in income. The income of the rest of the population did not change. What happened to absolute and relative poverty?
- both increased
- absolute poverty increased and relative poverty remained constant
- absolute poverty remained constant and relative poverty increased
- both remained constant
Show answer and explanation
Answer: C. absolute poverty remained constant and relative poverty increased
The poor are no worse off in absolute terms, but they now fall further behind average incomes.