IB ECONOMICS
INTERNAL ASSESSMENT
BOOKLET
Class of 2020
Name: _________________________________________________________
Internal Assessment
Internal assessment (IA) is an integral part of the Diploma Programme economics course. It enables you to
demonstrate the application of your knowledge of economic theory to real-world situations without the time
constraints of written examinations. At HL and SL, the IA portfolio is worth 20% of the final grade and the IB
recommends 20 hours be spent on this component. Performing well on the portfolio can really help your grade!
Requirements
The requirements for the portfolio are the same at higher level and standard level. You produce a portfolio of
three commentaries of up to 750 words each, based on published extracts from the news media. The extracts
should be from a newspaper, and must not be from television or radio broadcasts. You should not choose a blog
or a transcript as the basis for your commentary.
Focus
The three commentaries must have as their main focus a different section of the syllabus, although it is
acceptable for commentaries to make reference to other sections.
Each commentary must:
 explain the linkages between the article and economic theory taken from the section of the syllabus on
which the article is based.
 demonstrate economic insights into the implications of the article (that is, it should provide evidence of
the student’s ability to discuss current events from the point of view of an economist).
Selection of Extracts
Sources
The extracts on which each commentary is based must be drawn from three different sources. The articles that
you choose to analyse should have been written within the last six months of the time of writing the
commentary. You should try to look for material relating to current events. In terms of the criteria, the articles
must have been published no earlier than one year before the writing of the commentary.
Individual work
You must select your own articles to analyse. It could be that you will have chosen the same article as a
classmate, but the production of the commentary must be your own individual work. A commentary must not
be prepared collaboratively.
Language of extract
If possible, the extract on which the commentary is based should be in English. If an extract in another language
is used, you must provide a translation, in English, of the parts of the article referred to in the commentary.
Guidance
You must understand the requirements of the portfolio and the assessment criteria. The assessment criteria
are given in this booklet.
Discussion and support
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It is a good idea to discuss the work you are doing for the portfolio with your teacher, and to seek advice and
information. You will not be penalized for seeking guidance!
Advice
As part of the learning process, your teacher can give you advice on a first draft of each portfolio commentary.
This advice can be either verbal or written and will suggest how the work could be improved. However, your
teacher is not allowed to extensively annotate or edit your draft. You may rewrite your commentary in line with
your teacher’s suggestions but your teacher may not advise you on more than one draft.
Authenticity
The portfolio submitted for internal assessment must be your own individual work. You will be asked to sign a
document confirming that the work is your own.
Logistical requirements
On each submission date, you will submit three documents – a cover sheet, the article that you have used and
your commentary. The cover sheet must include the following required information:
 the title of the article
 the source of the article (including date of access to the site if from the internet)
 the date the article was published
 the word count of the commentary
 the date the commentary was written
 the section of the syllabus to which the commentary relates.
There is a copy of a commentary cover sheet on Page 9 of this booklet. Dr. O’Shannassy will include a copy on
Powerschool to use.
Each time a commentary is due, the three pieces will be handed in to your teacher. They will be marked using
an internal rubric that you will be given before you attempt the first commentary.
You must keep an electronic copy of each commentary and a hard copy of the commentary. This is essential.
Rubric requirements
If students do not adhere to the following requirements, they can lose marks under criterion F: Rubric
requirements.
Word limit
Students must produce a portfolio of three commentaries. Each commentary must not exceed 750 words.
Note: Moderators will not read beyond 750 words for each commentary.
The following are not included in the word count.
• Acknowledgments
• Contents page
• Diagrams
• Labels—of five words or fewer
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•
•
•
•
•
Headings on diagrams - of 10 words or fewer
Tables of statistical data
Equations, formulae and calculations
Citations (which, if used, must be in the body of the commentary)
References (which, if used, must be in the footnotes/endnotes)
Please note that footnotes/endnotes may be used for references only. Definitions of economic terms and
quotations, if used, must be in the body of the work and are included in the word count. Please note that a
citation is a shorthand method of making a reference in the body of the commentary, which is then linked to
the full reference in the footnotes/endnotes.
Articles
Each article must be based on a different section of the syllabus.
Sources
Students must use a different source for each commentary.
Contemporary articles
Students need to look for articles relating to current events and these must be published no earlier than one
year before the writing of the commentary.
Contents
Each portfolio must contain:
• a summary portfolio coversheet
• a commentary coversheet for each commentary
• three commentaries, accompanied in each case by the relevant article.
Internal Assessment Criteria
Overview
There are five internal assessment criteria for each commentary.
Criterion A
Diagrams
3 marks
Criterion B
Terminology
2 marks
Criterion C
Application
2 marks
Criterion D
Analysis
3 marks
Criterion E
Evaluation
4 marks
Total
14 marks
There is one internal assessment criterion for the whole portfolio.
Criterion F
Rubric requirements 3 marks
Each commentary is assessed individually for the first five assessment criteria (criteria A–E) and then criterion
F is applied to the whole portfolio.
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The maximum for the portfolio is 45 marks: (14 marks x 3 commentaries) + 3 marks = 42 + 3 marks.
Portfolio (SL/HL)
Criterion A: Diagrams
This criterion assesses the extent to which the student is able to construct and use diagrams.
Level
Descriptor
0
The work does not reach a standard described by the descriptors below.
1
Relevant diagram(s) are included but not explained, or the explanations are
incorrect.
2
Relevant, accurate and correctly labelled diagram(s) are included, with a
limited explanation.
3
Relevant, accurate and correctly labelled diagram(s) are included, with a full explanation.
Criterion B: Terminology
This criterion assesses the extent to which the student uses appropriate economic terminology.
Level
Descriptor
0
The work does not reach a standard described by the descriptors below.
1
Terminology relevant to the article is included in the commentary.
2
Terminology relevant to the article is used appropriately throughout the
commentary.
Criterion C: Application
This criterion assesses the extent to which the student recognizes, understands and applies economic
information in the context of the article.
Level
Descriptor
0
The work does not reach a standard described by the descriptors below.
1
Relevant economic concepts and/or theories are applied to the article.
2
Relevant economic concepts and/or theories are applied to the article
appropriately throughout the commentary.
Criterion D: Analysis
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This criterion assesses the extent to which the student can explain and develop appropriate economic theories
and/or concepts in the context of the article.
Level
Descriptor
0
The work does not reach a standard described by the descriptors below.
1
There is limited economic analysis relating to the article.
2
There is appropriate economic analysis relating to the article.
3
There is effective economic analysis relating to the article.
Criterion E: Evaluation
This criterion assesses the extent to which the student synthesizes his or her analysis in order to make judgments
that are supported by reasoned arguments.
Level
Descriptor
0
The work does not reach a standard described by the descriptors below.
1
Judgments are made that are unsupported, or supported, by incorrect
reasoning.
2
Judgments are made that are supported by limited reasoning.
3
Judgments are made that are supported by appropriate reasoning.
4
Judgments are made that are supported by effective and balanced
reasoning.
Criterion F: Rubric requirements
This criterion assesses the extent to which the student meets the five rubric requirements for the complete
portfolio.
 Each commentary does not exceed 750 words.
 Each article is based on a different section of the syllabus.
 Each article is taken from a different and appropriate source.
 Each article was published no earlier than one year before the writing of the commentary.
 The summary portfolio coversheet, three commentary coversheets and the article for each
commentary are included.
Level
0
Descriptor
The work does not reach a standard described by the descriptors below.
1
Three rubric requirements are met.
2
Four rubric requirements are met.
3
All five rubric requirements are met.
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Checklist
The following checklist can be used to check each commentary before handing it in.
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Have you printed a second copy of your article and commentary for
Dr.O’Shannassy file? Have you kept an electronic copy of the article and
commentary for yourself?
Have you submitted the electronic copy to Turnitin.com via the class
Haiku/Powerschool site?
Is there a cover sheet?
On the cover sheet, have you noted the:
 title of the article
 source of the article using a MLA format (including date of access
to the site if from the internet)
 date the article was published
 word count of the commentary
 date the commentary was written (remember, this can be no
more than one year after the publication of the article)
 section of the syllabus to which the commentary relates.
Have you included the article?
Is the commentary below the word limit (750 words)? Have you counted
all the words?
If necessary, have you highlighted the relevant parts of the extract?
Have you checked that each article is from a different source, i.e. it is
not taken from the same news media as ones you have used in other
commentaries?
Have you labelled your diagrams accurately? (With relevant information
from the article?)
Are your diagrams neatly presented?
Have you clearly explained your diagrams?
Have you included quotations and any numerical data from the article?
Have you used appropriate economic terminology?
Have you attempted to provide evidence of evaluation?
Have you made sure that you are not repeating analysis that you have
done in a previous commentary?
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2
3
IB Economics – Internal Assessment Coversheet
School Code
Name of school
00072
American International School – Vienna
Candidate name
Candidate number
Teacher
Title of the article
Source of the article
Date the article was
published
Date the commentary was
written
Word count (750 words
maximum)
Section of the syllabus the
article relates to (please
tick the one that is the
most relevant)
 Section 1: Microeconomics
 Section 2: Macroeconomics
 Section 3: International economics
 Section 4: Development economics
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Practice Article / IA
Smokers stock up on cigarettes to avoid tax hike Juneau braces for bar-restaurant ban to take effect Jan. 2
Adapted from The Juneau Times/Associated Press - December 30th 2004
Customers at Lucky Raven Tobacco in Soldotna are stocking up on cigarettes to avoid a state tax rate increase. Smokers
in Juneau are starting to move from restaurants with bars to plain bars, to avoid a city ban on smoking in the combined
establishment, bartenders said.
Those two laws, one state and one local, will affect smokers in 2005. The state tax starts on New Year's Day. The
smoking ban begins Jan. 2. The tax hike is expected to generate an additional $20 million for the state.
Jack Dean, cashier at the Lucky Raven Tobacco shop, said customers are purchasing up to four times the amount of
cigarettes they usually buy. Mike Patterson, owner of Lucky Raven, said usually when tobacco taxes increase, it hurts
businesses. He believes customers will find ways to avoid it, such as buying them online. He also expects a sales increase
in cigarette rolling products and cigars, which are not affected by the tax.
Patterson said he thinks this could lead to a decrease in tax revenue, which would be counterproductive. Department of
Revenue officials said the last time the tobacco tax was raised in 1997, they lost about $7 million the first year due to
stockpiling.
A pack of cigarettes has been taxed by the state at $1 since October 1997. Lawmakers voted to gradually double the tax.
A 60-cent tax hike on each pack of cigarettes will go into effect in January. The tax will go up 20 cents more in 2006
and another 20 cents in 2007.
Not everyone has heard of the tax hike. Mark Rackley, smoking outside Merchants Wharf in Juneau on Wednesday
evening, said he didn't know about the increase but it wouldn't affect his use of cigarettes. Rackley said he smokes only
occasionally.
Todd Maclay, a bartender at Hangar on the Wharf in Juneau, said he hasn't heard customers talking about the tax
increase. But he has heard from customers who are looking for a place to drink and smoke. "My regulars are starting to
gravitate to places they can smoke," Maclay said Wednesday. "Nobody's quit smoking because of the smoking ban."
The Hangar's bartenders estimate that 40 percent to 50 percent of their regular customers smoke. Smokers aren't going
to want to step outside and smoke in bad weather, he said.
Right now, the state takes in about $46 million each year from the tax, said Johanna Bales, program manager for tobacco
tax for the state of Alaska. Seventy-six percent of the tax is earmarked for the school fund, which is dedicated to school
construction. Bales said the state pays out about $125 million each year for smoking-related illnesses.
The entire amount of revenue generated from the increase will be for the state's general fund, she said. Almost 9 percent
of that money will go toward the Tobacco Use Education and Cessation fund, which is designed to help smokers stop.
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Smokers stock up on cigarettes to avoid tax hike Juneau braces for bar-restaurant ban to take effect Jan. 2
Adapted from The Juneau Times/Associated Press - December 30,2004
Answer the following questions in full sentences. Use quotations from the text wherever possible to illustrate your points.
Use this as the basis for your practice commentary.
Bonus points for including references to elasticity of demand!
1. Explain three things that Alaskan governments (state + local) are doing to reduce smoking.
 #1:
 #2:
 #3:
2. Explain at least two reasons why the governments are implementing these policies.
 #1:
 #2:
 #3:
3. Draw two diagrams to illustrate how these policies are expected to work. Make sure that you label the axes
accurately and include real values where possible.
4. Evaluate* the likely outcomes of the policies. In your evaluation, discuss how likely it is that the policies will
achieve the objectives of the government.
* Remember that you can evaluate by doing the following three things:
 Consider the short run and long run effects

Consider the issue from the point of view of different stakeholders (stakeholders include:
1.
2.
3.
4.
5.

Consider the advantages and disadvantages of the policies. (This is likely to be carried out by looking
at the various stakeholders.)
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ON EVALUATION
There are likely to be several places throughout your assessment pieces in IB Economics where you are asked to evaluate something.
One place is likely to be the last part/ question on your Paper 3 (data response) and another one is in part (b) of your Paper 1
questions. It is also possible to evaluate on Higher Level Paper 2, but it is more important on this paper to present accurate theory
with appropriate diagrams as quickly as possible. Finally, Criterion D on your Internal Assessment commentary is clearly another
main place where you will be required to evaluate.
In each instance, the highest mark bands are reserved for students who can illustrate the skill of evaluation and so your proficiency
at evaluation / synthesis is very important. Besides, being able to evaluate information is central to critical thinking and is rightly
one of centrepieces of your IB education and, arguably, one of the most important skills to cultivate in today’s world.
What does evaluation mean?
Two dictionary definitions of evaluate are as follows:


v: to examine and judge carefully; appraise
v : place a value on; judge the worth of something
How can I accomplish evaluation?
It is not quite enough to simply finish a sentence that begins, “On the other hand . . .” but it is a good start.

Prioritise the arguments
“The most important argument against protectionism in international trade is that it represents a global misallocation of
resources.” or “The least effective argument for protectionism in international trade, in terms of economic reasoning, is
that the industry is a strategic industry.”

Long run vs. short run
“In the short run, abnormal profits can be earned. However, in the long run this is not possible.” or “In the short run, it
may be possible to justify the infant industry argument. However, the danger is that in the long run, the industry will
remain inefficient.”

Consider the issue from the points of view of different stakeholders.
What is a stakeholder? One dictionary definition is as follows: a person or group that has an investment, share, or interest
in something.
In terms of economic theory, examples of stakeholders could be domestic producers, consumers, workers, foreign
producers, high income people, low income people, the government (domestic and foreign) or society more broadly (both
domestic and global).
“A high exchange rate may be good for consumers because it makes imported goods less expensive and forces domestic
producers to be more efficient so that they compete with the less expensive imports. On the other hand, it is clearly a
disadvantage for those domestic producers who suffer from the competition from imports which become less expensive
with the higher value of the currency.” or “Supply side policies may be very good in terms of creating a more flexible
labour force and achieving economic growth. However, it may lower the standards of living of workers who may suffer
from deregulation of the labour laws.”
Practice

The law of demand says that the higher the price of a good, the lower will be the quantity demanded. This
accounts for the downward-sloping demand curve. However, there are exceptions to this law. Two exceptions
to the law are ____________________________.

There are several factors which cause a shift in the supply curve. These are ___ and . . . The most important of
these is _____ because ____ . . .

Minimum prices are good for _______________ because_____ . . .. However, they can be considered to be
negative for __________ because _______ . . . .
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
Maximum prices are good for _______________ because_____ . . . However, they can be considered to be
negative for __________ because ______ . . . .

Subsidies are good for _____ because ___ . . However, . . .

The answer to the question, “Should prices be increased?” depends on many things. It depends on ______ . . .

One way to correct the market failure of negative externalities is to tax the producers of the good creating the
negative externality. However, this is difficult because, _____ . . It is also a problems because _____ . . . (
Market failure is a topic which involves much evaluation. You have to be able to evaluate any of the solutions
to any of the sources of market failure.)

In the short run, a firm is only able to increase output up to a certain point. This is due to the law of ____.
However, in the long run, all ____ . . . .

The biggest advantage of perfect competition (although it is primarily a theoretical advantage as is it very
unlikely that a real life market structure would follow all the assumptions of perfect competition) is that _____.
The disadvantage , however, would be that ____ . . (Assess the advantages and disadvantages of all the market
structures, considering the different stakeholders - and using the terms producer and consumer sovereignty)

Price discrimination can be considered to be negative because ______________ . . . On the positive side,
however, ______ . . .

There are four main central macroeconomic objectives which every government pursues. These are: ____ . . .
The difficulty that governments face is that when they pursue one objective, it is highly likely that other
objectives will come into conflict. For example, ___ . . (You can do this many times)

In the short run, economists agree that the aggregate supply curve is upward sloping. There is considerable
controversy over the likely shape of a country’s long run aggregate supply curve. Neo-Keynesians believe that
___ . . . Neo-classical economists, on the other hand, argue that ____ …. However, economists agree that the
LRAS curve is vertical at the full employment level of output. (This writing would obviously be accompanied
by several diagrams!)

Increasing aggregate demand may be good when ___ . . However, if the economy is __ . . . . .

Demand management may be appropriate for solving ____ unemployment. However, if the unemployment is
___ . . then increasing AD is likely to ___ . . .

In the short run, there may be a trade-off between inflation and unemployment. However, ___ . . . .

If a government wants to increase its spending to stimulate the economy, it may have to run a budget deficit.
The disadvantages of this are ___ . .

The advantages and disadvantages of tariffs depend on the various stakeholders. The diagram showing the effect
of a tariff is very useful for pointing out the various advantages and disadvantages. As can be seen in the diagram
below, ___ . . .

A country may decide to deal with a current account deficit by using expenditure reducing policies. These
include __ . . . The problems with these are __ . . . An alternate policy would be expenditure switching. This
can be done by ____ . . Disadvantages associated with these are ___ . . .
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
A high value of a currency is good for ____ and . . . . because ___ . . . However, it can be very damaging for
___ . . . because _____ . . .

A low value of a currency is good for ____ and . . . . because ___ . . . However, it can be very damaging for
___ . . . because _____ . . .

Economic growth is highly desirable because ____ . . . However, on the negative side, __ .. . .
 The principal difference between economic growth and economic development is that ______ . . . .
 When considering the advantages and disadvantages of foreign direct investment, it is important to look at the
implications for both growth and development. In terms of achieving economic growth, FDI is very important
because ___ . . . However, when considering economic development, there are different arguments. For example,
__ . .
 When considering the advantages and disadvantages of international trade to LDCs, it is important to look at the
implications for both growth and development. In terms of achieving economic growth, trade is very important
because ___ . . . However, when considering economic development, there are different arguments. For example,
__ . ..
 When considering the advantages and disadvantages of foreign aid, it is important to look at the implications for
both growth and development. In terms of achieving economic growth, aid can be very important in filling several
gaps such as ___ . . However, the implications in terms of development are ___ . . .
 An outward-oriented strategy may be successful in terms of achieving _____. However, the disadvantages may
be ___ . . . .
 The biggest disadvantage of an inward-oriented strategy is that ____ . .
ESSAY QUESTIONS

Evaluate the solutions that a government might employ to correct the problems of market failure.

Evaluate the effects of a rising interest rate on an economy.

Evaluate the effects of a falling exchange rate on an economy.

Evaluate the arguments in favour of MNC investment in LDCs.

Evaluate the view that foreign aid is more of a disadvantage for LDCs than an advantage.

Evaluate the measures that a government might use to reduce unemployment.

Evaluate the measures that a government might use to reduce inflation.

Evaluate the measures that a government might use to achieve economic growth.

Evaluate the measures that a government might use to reduce a current account deficit.
Please note: The practice questions and essay titles above do not represent an exhaustive list of all the questions you could be asked.
Examiners do their best to come up with original questions to test your knowledge and skills as an economist!
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