Facts and Stats
Which small economy has benefited from selling unique internet domain names like .ai?
Anguilla
If domain sales increase, who benefits first?
The government
Name one thing a small economy could spend revenue on to support tourism.
Airports or hotels
More tourists visit the island — which curve shifts and where?
AD shifts right
Besides domain sales, what is another major source of income for many small island economies?
Tourism
Who benefits when a country diversifies its economy between tourism and digital sectors?
The population and businesses
Spending revenue on hospitals affects which curve?
Aggregate demand (AD)
A hurricane destroys hotels — which curve shifts and where?
AS shifts left
How much did Anguilla earn from selling .ai domain names?
Over 39 million dollars
If the government invests domain revenue into infrastructure, who benefits?
Citizens, businesses, and future tourists
Building factories or investing in technology affects which curve in the long run?
Aggregate supply (AS)
A hurricane hits while domain revenue increases. Where does each curve shift
AS shifts left, AD shifts right
How much of the government income is due to the .ai domain?
23-25%
Who might lose out if the island relies only on tourism for income and why?
When global decline reduces visitors
What is one possible risk of spending too much government revenue in one sector?
Other areas may be neglected, creating imbalance in the economy.
If global demand for AI domains grows, which curve shifts and where?
Aggregate demand (AD) shifts right.
Name one reason small economies seek to diversify income sources beyond tourism.
To reduce vulnerability to external shocks like hurricanes or global crises
How do ordinary citizens benefit when domain income is reinvested into education and training?
They gain new skills and job opportunities, boosting long-term prosperity.
Evaluate the opportunity cost of investing heavily in tourism infrastructure versus investing in digital industries for Anguilla’s future growth. In terms of AD and AS
Tourism may boost short-term AD, but digital investment may strengthen long-term AS.
In the long run, if Anguilla becomes overly dependent on domain sales, how could a global tech decline affect both AD and AS.
AD falls, AS may fall too (less funding for infrastructure/education), leading to lower output and possibly higher unemployment.