IB Economics SL & HLTopic 5 — Exam Skills and AssessmentPapers 2 & 3Calculation skill~9 min read
Working Through Calculation Questions
Calculation questions are the fairest marks in IB Economics: there is a right answer and a clear route to it. They are also where careless students bleed marks, because the examiner is paying at least as much attention to your method as to your final number.
📚 What you need to know
Calculations appear mainly in Paper 2 and Paper 3, and test AO4.
Marks are given for a clear method, accurate working, correct units and rounding, and where asked, interpretation.
Method marks survive a wrong answer. A wrong number with clear working still scores; a wrong number with no working scores nothing.
Always write the formula before you substitute.
Include the unit in the final answer: $, %, units, or “no units” for elasticity.
Round at the end only, to two decimal places unless told otherwise.
Results from one part are usually needed again later, so keep them where you can find them.
The four lines that earn the marks
Whatever the calculation is, the layout of a full-mark answer is the same. Four lines, in this order. Get into the habit now and it becomes automatic under pressure.
Writing the formula out costs about five seconds and protects you against every kind of slip that follows.
Students who write only the final answer are gambling. If the number is right they get everything; if it is wrong they get nothing. Showing the method turns that gamble into a safe bet.
Price elasticity of demand
PED = percentage change in quantity demanded ÷ percentage change in price
The same shape covers most of the others: elasticity is always one percentage change divided by another, and every percentage change uses the same formula above. Learn the shape once and you can rebuild the rest under exam pressure.
Reading the number once you have it
Many calculation questions are followed by a short “comment on” or “interpret” part. That is a separate skill: the number on its own is not an answer, it needs a meaning.
Elasticity has no units, so do not attach a dollar sign or a percentage to it. It is a plain number.
Worked examples
WORKED EXAMPLE
Percentage change
A country’s real GDP rises from $250 billion to $265 billion. Calculate the percentage change in real GDP. [2]
Step 1: formula% change = ((new − old) ÷ old) × 100Step 2: substitute= ((265 − 250) ÷ 250) × 100Step 3: work it through= (15 ÷ 250) × 100 = 0.06 × 100= 6% The unit here is the % sign. Leaving it off can cost the final mark.
WORKED EXAMPLE
Price elasticity of demand
When the price of a cup of coffee rises from $4.00 to $4.60, quantity demanded falls from 500 to 440 cups a week. Calculate the PED. [4]
Step 1: percentage change in quantity demanded((440 − 500) ÷ 500) × 100 = −12%Step 2: percentage change in price((4.60 − 4.00) ÷ 4.00) × 100 = 15%Step 3: dividePED = −12 ÷ 15PED = −0.8Keep the minus sign. Dropping it is one of the most common single-mark losses in the paper.
WORKED EXAMPLE
Interpretation
Using your answer above, comment on the elasticity of demand for coffee and on what happens to the seller’s revenue. [2]
Step 1: name the value and what it means
PED is −0.8, and 0.8 is less than 1, so demand is price inelastic.
Step 2: say it in words
A change in price causes a proportionately smaller change in quantity demanded.
Step 3: link to revenue
Revenue was 500 × $4.00 = $2000. It is now 440 × $4.60 = $2024.
Demand is inelastic, so revenue risesThe numbers confirm the theory. Using them as evidence is what lifts an answer into the top band.
💡 Exam tip
Write the formula first even for sums you could do in your head.
Copy the figures carefully from the table, and check the units at the top of the column.
Do not round in the middle. Keep full accuracy in the calculator and round the final line.
Label your answer: $, %, million, units, or “no units” for an elasticity.
Star your results so you can reuse them in later parts without recalculating.
If you get stuck, still write the formula. That is a mark you would otherwise have thrown away.
Sense-check the number. An unemployment rate of 340% means you have made a slip somewhere.
⚠ Common mix-up
Only writing the answer. If it is wrong, there is nothing left to reward.
Dropping the negative sign on PED, on a deficit, or on a fall in quantity.
Rounding too early and drifting away from the correct final figure.
Omitting units, which is the single most avoidable mark loss in the paper.
Dividing the wrong way round — PED is the change in quantity over the change in price, not the reverse.
Calculating and then stopping when the question also asked what the number means.
Ignoring your own results later, in the evaluative parts where they would be strongest.
Up next: Structuring a Paper 1 Essay — how to turn a blank page and a 25-mark question into a plan you can actually write in 75 minutes.
Want this explained one-to-one?
Book a free session with an experienced IB Economics tutor and get your trickiest topics made simple.
