Oil was found in Kenya in 2012, yet in 2014 an American firm abandoned its plans to explore for oil in the Arabuko Sokoke forest in the country. The relative proportions of Kenya’s primary, secondary and tertiary sectors are shifting. The stock of capital goods in the country is also rising.
(a)[2]
State what is meant by the ‘secondary sector’ and provide one example.
(b)[4]
Explain two benefits that can arise for an economy when oil is discovered on its land.
(c)[6]
Analyse why the social costs of oil extraction may exceed the private costs.
(d)[8]
Discuss whether a country would gain from devoting more resources to producing capital goods.
Worked solution & mark scheme
This 20-mark question has a full step-by-step worked solution and mark scheme. One marking point: “Turning raw materials into goods/manufacturing” …