Day: October 3, 2021

In 2000 Ruritania joined the European Union (EU). Many Ruritanian workers then migrated to other European countries to seek work.

The most likely impact of this migration on businesses in Ruritania is?

Select ONE answer:

1. average wage rates are reduced
2. economic growth is sustained
3. more people are willing to work
4. skills gaps cannot be filled

Show your workings to arrive at your answer, and explain and justify your reasons:

……………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………

This multiple-choice question is suitable for Accounting KS5 classes.

The answer is 4

1. Not correct – average wage rates are likely to rise when there is a shortage of skilled labour in Ruritania, who will then command a premium price.
2. Not correct – it will be difficult to sustain economic growth when the workforce is reduced, and many Ruritanian business may not be able to maintain current output.
3. Not correct – the Ruritanian population is being reduced which means fewer people are available and willing to work.
4. Correct – migration is the movement of people from one country to another. Skilled Ruritanian workers found employment in other EU countries.  Therefore from 2000 onwards businesses in Ruritania could not find enough skilled workers to fill vacancies.

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