A hotel in Negril, Jamaica employs 200 local workers. The hotel also purchases vegetables from nearby farmers and seafood from local fishermen. Which type of economic impact does this BEST illustrate?

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Question

A hotel in Negril, Jamaica employs 200 local workers. The hotel also purchases vegetables from nearby farmers and seafood from local fishermen. Which type of economic impact does this BEST illustrate?

Accepted Answer

Multiplier effect — Award 1 mark for identifying the multiplier effect — tourist spending circulates through the local economy creating additional income and employment. A is incorrect — leakage refers to money leaving the local economy. C is incorrect — this describes jobs lost during low season. D is incorrect — import substitution refers to producing goods locally instead of importing them.

Answer

Import substitution

Answer

Seasonal unemployment

Answer

Multiplier effect

Answer

Economic leakage

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