(a)[6]
- Calculate the price elasticity of demand for meat in Bishkek. [2]
- How does the price elasticity of demand for meat differ from the price elasticity of demand for flour in Bishkek? [2]
- How might an economist account for this difference? [2]
(b)[3]
Using a supply and demand diagram, explain how the Russian central bank is ‘attempting to protect the value of the rouble’.
(c)[5]
Assess the extent to which Kyrgyzstan’s economic performance would be affected by the fall in remittances from Russia.
(d)[6]
Discuss whether the actions taken by the Russian and Kyrgyzstan governments to protect the value of their currencies are likely, on balance, to have benefited their economies.