Long Essays May 1990 May 2015

Size: px
Start display at page:

Download "Long Essays May 1990 May 2015"

Transcription

1 Microeconomics Long Essays May 1990 May What alternative solutions might an economist suggest to the problem of traffic congestion? What are the advantages and disadvantages of each of these solutions? [M 90, 6] 2. Under what conditions can a firm sell the same product at different prices? [N 90, 5] 3. European governments have a policy of supporting farm incomes with artificially higher prices for certain foodstuffs. What are the economic effects of this on Europe and the rest of the world? [M 91, 4] 4. Pollution is sometimes said to be an example of market failure. What is meant by this? How might governments encourage markets to work towards helping solve environmental problems? [M 93, 3] 5. In what circumstances might a government use price controls to influence a market? [N 93, 3] 6. Is the existence of monopoly in an industry likely to improve or worsen resource allocation? [N 93, 4] 7. Why are many industries, such as car manufacturing, becoming more oligopolistic? How are the price and output decisions of firms affected by this trend? [M 94, 3] 8. Economic theory makes certain assumptions about market conditions, in order to study how firms decide on prices and output. Are these assumptions realistic, and do firms always behave in the real world as Economics textbooks predict? [M 95, 5] 9 Briefly explain what economists mean by the word market. What kind of problems are markets good at solving, and what are they bad at solving? [N 95, 3] 10. Why does there appear to be a movement towards oligopoly in certain markets? How does this movement affect the way in which producers make decisions, and how does it affect the welfare of consumers? [N 95, 5] 11. Evaluate the roles of markets and planning in an economy today? How are these roles likely to change? [M 96, 6]

2 12. What are the assumptions behind the model of a perfectly competitive industry in long-run equilibrium? Why do economists make assumptions of this sort? Are such assumptions realistic? [N 96, 3] 13. a. Why are profits important in a market economy? b. What problems might a country experience if it tries to use the profit motive to produce everything? [M 97, 3] 14. a. What are economies of scale, and why have they become so important in modern economics? (12) b. In view of this importance, why do so many small enterprises operate successfully in the world today? (13) [M 97, 5] 15. a. Explain what externalities are and how they may arise. (15 marks) b. Discuss whether governments should always involve themselves in markets with substantial externalities. [Spec, 3] 16. a. What are the main features of an oligopolistic market? (15 marks) b. Do oligopolies work in favor of, or against the interest of consumers? ) [Spec, 4] 17. a. What do economists mean by externalities or spillover effects? b. How does an understanding of externalities (spillover effects) assists economists in analyzing environmental problems? [M 98, 4] 18. a. What are natural monopolies and why are they considered a danger if left unregulated? b. Is nationalization of natural monopolies the best method of improving their economic efficiency? [N 98, 3] 19. a. Distinguish between private costs and benefits and social costs and benefits. (8) b. Explain how an increase in the number of cars n the roads of a country might lead to a misallocation of resources. (8) (c) Evaluate the ways in which a government might remedy this misallocation. (9) [M 99, 3] 20. a. Carefully explain what is it that price, income and cross elasticities of demand are meant to measure. b. Discuss the practical importance of the concept of price elasticity of demand for (i) business organizations (ii) the government [M 99, 4]

3 21. a. Why do environmental issues cause problems to economists? b. Discuss solutions an economist might suggest to the problem of overfishing? [N 99, 3] 22. a. State the law of demand and distinguish between movements along the demand curve and shifts of the demand curve. b. Explain, with the help of diagrams, the effect of an increase in the price of petrol is likely to have on (i) The market for cars. (ii) The market for coal. [M 00, 3] 23. Monopoly price is higher and output smaller than is socially ideal. The public is a victim. (J.K. Galbraith, 1974) a. Explain the economic reasoning behind the statement that monopoly price is higher and output smaller than is socially ideal. b. To what extent do you agree that the public is always the victim of monopoly? [M 00, 4] 24. a. Explain why environmental problems are considered to be examples of market failure? b. To what extent can government intervention correct this failure? [N 00, 3] 25. a. Under what conditions is price discrimination possible and profitable? (12) b. Who gains and who loses from price discrimination? Illustrate your answer with examples. (13) [N 00, 4] 26. a. Using suitable diagrams, explain why there is likely to be an absence of long run economic profits in perfect competition. (10 marks) b. To what extent might consumers benefit from increased competition between firms? [M 01, 3] 27. a. How does a monopoly maintain supernormal (or abnormal) profit in the long run? b. Discuss whether monopoly is always undesirable? [N 01, 3] 28. Discuss and evaluate the proposition that perfect competition is a more efficient market structure than monopoly. [M 02, 3] 29. a. Explain why pollution is an example of a market failure?

4 b. To what extent can the market system protect the environment? [N 02, 3] 30. a. Explain what does an economist means by efficiency? b. Discuss whether the achievement of efficiency is possible and desirable. [N 02, 4] 31. a. Explain the role that prices play in the allocation of resources in free market economies? b. Evaluate, using examples, the options available to governments to overcome the failure of markets arising from the production and consumption of demerit goods. [M03, 1] 32. a. Explain how monopoly power might arise. b. Evaluate the extent to which governments should seek to control the growth of monopoly power. [M03, 2] 33. National policies and international agreements must be implemented in order to reduce global environmental problems. a. Using the concepts of market failure, explain the statement above from an economist s point of view. b. With references to both national policies and international agreements, evaluate three solutions that could be recommended by economists. [N 03, 1] 34. Discuss the economic arguments for and against imposing substantially higher levels of taxation on the sale of alcohol. [M04, 1] 35. a. In what ways do firms operating in different market structures compete? b. Discuss the view that the more competition there is within each industry, the better. [M04, 2] 36. a. Explain the concepts of maximum and minimum price controls. b. Evaluate the idea that government intervention in the form of price ceilings and price floors is well intentioned, but often leads to undesirable side effects. [N 04, 1]

5 37a. a. Explain how a monopolist may be able to earn supernormal (abnormal) profits in the long run b. Production by a monopolist will always be against the interests of consumers. Discuss. [Spec] 37. a. Explain how profit is determined in perfect competition b. Whatever the type of market structure, profit maximization will always be the only goal of firms. Discuss. [May 2005] 38. a. Explain the differences between monopolistic competition and oligopoly as market structures b. Discuss the differences between a collusive and a non-collusive oligopoly [Nov 2005] 39. a. Carefully distinguish between merit goods, demerit goods and public goods b. Evaluate the view that governments should always intervene in markets for such goods as cigarettes and alcohol [May 2006] 40. a. Explain the necessary conditions for price discrimination to take place b. Discuss the advantages and disadvantages of price discrimination for consumers and producers [Nov 06] 41. a. Explain how barriers to entry may affect market structure b. Evaluate the view that monopoly is an undesirable type of market structure [May 07] 42. a. Explain the difference between short run equilibrium and long run equilibrium in monopolistic competition b. Perfect competition is a more desirable market form than monopolistic competition. Discuss. [Nov 07]

6 43. a. Explain how a firm operating in an oligopolistic market might attempt to increase its market share b. Evaluate the view that producers, and not consumers, are the main beneficiaries of oligopolistic market structures [May 08] 44. a. Explain the determinants of price elasticity of demand. b. A deterioration in a country s terms of trade will always be disadvantageous for the current account balance. Evaluate this statement using the concept of price elasticity of demand. [Nov 08] 45. a. Explain the concepts of allocative and productive (technical) efficiency. b. Monopolies are inefficient and therefore always act against the public interest. Discuss this statement. [Nov 08] 46. a. In the theory of the firm, a distinction is made between short run cost curves and long run cost curves. Using appropriate cost curve diagrams, explain this distinction. b. Evaluate the view that greater economic efficiency will always be achieved in perfect competition as compared to monopoly. [May 09, 1] 47. a. Explain why a firm may practice price discrimination and the necessary conditions for it to take place b. Although a firm may pursue a range of goals, economists usually assume that profit maximization is the main goal. Discuss this statement. Nov a. Explain the importance of price elasticity of demand and cross price elasticity of demand for business decision making b. Studies have shown that the demand for tobacco tends to be highly price inelastic. Evaluate the view that governments can best reduce smoking by substantially increasing taxes on cigarettes. May 10, 1

7 50. a. Explain why negative externalities of production are an example of market failure b. Evaluate three policies that governments might implement to reduce negative externalities associated with the environment Nov 10, 1 50a. a. Using an appropriate diagram, explain how a monopolist might be able to make supernormal (abnormal) profits in the short run, and why these profits might continue to be earned in the long run b. Evaluate the view that monopolistic competition is a more economically desirable market form than monopoly May 11 TZ1 50b. a. Using at least one diagram, explain why a firm in perfect competition might only be able to make supernormal (abnormal) profits in the short run and not in the long run b. Evaluate the view that perfect competition is a more desirable market form that oligopoly May 11 TZ2 51. a. Using an appropriate diagram, explain how a monopolist might be able to make supernormal profits in the short run, and why these profits might continue to be earned in the long run. b. Evaluate the view that monopolistic competition is a more economically desirable market form than monopoly. TZ1 May 12 51a. a. Explain the economic factors which may encourage the formation of a monopoly b. Evaluate the view that natural monopoly is a more desirable market structure than perfect competition May 12 TZ1 52. a. Using at least one diagram, explain why a firm in perfect competition might only be able to make supernormal(abnormal) profits in the short-run and not in the long-run. b. Evaluate the view that perfect competition is a more desirable market form than oligopoly. TZ2 May 12

8 52a. a. Explain why, in markets dominated by a few firms, prices may remain relatively stable b. An industry with a larger number of firms will experience lower prices and greater efficiency than an industry with a smaller number of firms. Evaluate this view. TZ2 May 12 52b. a. Explain why firms in monopolistic competition can make economic (abnormal) profits only in the short run b. Compare and contrast the market structures on monopoly and monopolistic competition Specimen for c. a. Explain the possible negative externalities that might arise from the increased use of cars b. Discuss economic policy options that a government might use to reduce negative externalities that might arise from the increased use of cars Specimen for a. Explain why a monopoly can earn supernormal (abnormal) profits in the long-run. b. Evaluate the reasons why a government might allow a competitor into an industry that was previously a monopoly. TZ1 May a. Explain how welfare loss might result from monopoly power b. Discuss the effectiveness of government policies (legislation and regulation) to reduce monopoly power May 13 TZ1 55. a. Using a price ceiling diagram, analyze the impact a maximum price may have on the market for food b. Discuss the policies a government might use to make food more affordable to low income groups Nov 13

9 56. a. Explain why governments impose indirect taxes b. Discuss two possible government responses to threats to sustainability Nov a. Using diagrams, explain how a change in one of the determinants of demand might increase the price of rice and how a change in one of the determinants of supply might decrease the price of rice. b. Discuss the consequences of providing a subsidy on the production of rice for producers, consumers and the government May 14 TZ1 58. a. Using diagrams, explain why a perfectly competitive firm can make economic (abnormal) profits only in the short run b. Discuss the consequences of a perfectly competitive industry becoming a monopoly May 14 TZ1 59. a. Analyze the private and external benefits associated with the consumption of university education b. Evaluate the policies a government might use to increase the consumption of university education May 14 TZ2 60. a. Using a diagram, explain why firms in monopolistic competition are neither allocatively nor productively efficient. b. Examine the view that the market for food is more beneficial to consumers if dominated by a monopoly retailer (supermarket) rather than a by a large number of small shops operating under monopolistic competition May 14 TZ2 61. a. Using diagram(s), explain the signaling and incentive functions of price b. Evaluate the view that the market failure cause by the consumption of demerit goods is best dealt with through the use of taxation. Nov 14

10 62. a. Explain why firms might wish to collude b. Discuss the view that governments should always try to prevent a monopoly from occurring in a market Nov a. Explain how changes in price work to reallocate resources in a market b. Discuss the view that the overuse of common access resources is best addressed by government. TZ1 May a. Explain why prices tend to remain stable in oligopolistic markets b. Oligopolists often possess too much monopoly power. Evaluate whether governments should intervene in oligopolistic markets. TZ1 May a. Explain two possible government responses to the abuse of monopoly power b. Evaluate the view that monopolies, despite their inefficiencies, may often be considered desirable TZ2 May Nov 15

11 Macroeconomics 1. Discuss whether government macroeconomic demand management policies raise the real output of an economy in the long-run? [M 89, 4] 2. Most nations tax personal income. What are the arguments for and against personal income taxes? At what rates would you recommend setting income taxes? How would considerations of equity and efficiency influence your decision? [M 90, 5] 3. Unemployment can either be structural or cyclical. Explain how would government intervention differ in each case? [N 90, 4] 4. Under what conditions are high interest rates likely to benefit or damage a country's economy? [M 91, 5] 5. A reduction in unemployment is desirable, but it is certain to lead to other problems, such as inflation or balance of payments difficulties. Discuss. [M 91, 6] 6. Discuss the view that unemployment is a more serious economic problem that inflation. [M 92, 5] 7. Distinguish between supply side policies and demand management policies. Explain why many governments focus on the supply side? [M 93, 4] 8. Discuss whether there is a relationship between money supply and inflation. [N 93, 5] 9. Explain why might knowledge of the value of the multiplier be useful to government policy makers? Should governments make more use of this and other Keynesian ideas, or should they adopt non-keynesian policies? [N 95, 6] 10. Explain why investment is important to a country? Explain why the rates of investment differ in countries and what is the role of the government in encouraging investment? [M 96, 3] 11. Explain the social costs of unemployment? In view of these costs, explain why some countries give higher priority to tackling other problems such as inflation and balance of payments difficulties? [M 96, 4]

12 12. A government introduces supply side policies in order to have a flexible work force. Discuss the effectiveness of such policies. [N 96, 4] 13. a. What is monetarism? b. Explain how would a monetarist s view of economic problems (such as inflation and unemployment) and policies differ from that of a Keynesian? [M 97, 4] 14. Evaluate the costs and benefits for a country if its government adopts privatization as a major policy. [M 98, 3] 15. a. Is full employment possible? (8) b. Is full employment desirable (8) (c) Do international trading blocs such as NAFTA or the EU increase or reduce unemployment? (9) [M 98, 5] 16. To what extent is it wise for governments to follow a policy of always balancing their national budgets? [N 98, 4] 17. a. Briefly explain the various objectives of macroeconomic policy. b. Critically examine the view that the control of inflation should always be the most important objective of governments. [M 99, 5] 18. Is there a long-term trade-off between inflation and unemployment? [N 99, 4] 19. a. Explain how governments can use fiscal policy to redistribute income. b. Evaluate the advantages and disadvantages of policies aimed at reducing income inequalities [M 01, 5] 20. What is wanted is not inflation (a rise in the general price level) or deflation (a fall in the general price level) but price stability. Discuss. [N 01, 4]

13 21. a. What are the consequences of unemployment in an economy? b. Examine the policies that may be used to reduce unemployment. [M 02, 4] 22. a. What are the main macroeconomic objectives of government? b. Assume the government chooses to pursue one of these objectives. Evaluate the possible consequences for the other objectives. [N 02, 5] 23. Evaluate the view that the achievement of price stability should be the major objective of government economic policy. [M03, 3] 24. a. With the help of diagrams distinguish between demand-pull and cost-push inflation. b. Explain which policies would be appropriate to deal with these two types of inflation [N03, 3] 25. Unemployment remains persistently high in a majority of countries throughout the world a. Explain the economic problems that high unemployment may cause for a country. b. Discuss the reasons why governments find the goal of full employment difficult to achieve. [M04, 3] 26. Evaluate the effectiveness of demand-side and supply-side policies in the short and long run. Nov a. Explain the possible causes of inflation? b. Evaluate possible policies that might be used to lower the natural rate of unemployment [Spec] 28. a. Using suitable examples, explain the difference between the multiplier effect and the crowding-out effect. ( and explain the significance of automatic stabilizers)

14 b. Evaluate the proposition that the most effective way to reduce unemployment is through the use of demand-side policies. [May 05] 29. a. Explain the relationship between the Lorenz curve and the Gini coefficient b. Evaluate the effectiveness of the various methods that government may use to redistribute income [Nov05] 30. a. Explain the difference between demand-side and supply-side policies b. Higher economic growth can only be achieved through the implementation of supply-side policies. Discuss. [May06] 31. a. Explain how interest rates can be used to bring about an increase in economic activity b. Discuss the strengths and weaknesses of demand-side policies [Nov 06] 32. a. Explain possible causes of inflation (10 points) b. Evaluate the possible effects of a persistently high inflation rate on a country s current account balance and its exchange rate (15 points) [Nov 06] 33. a. Explain why a government might find it difficult to maintain a low rate of inflation as the economy approaches full employment b. Evaluate the proposition that the priority in economic management should be the maintenance of low unemployment [May 07] 34. a. Using one or more diagrams, explain the difference between the equilibrium level of national income and the full employment level of national income b. Evaluate the policies a government may use to increase the full employment level of national income [Nov 07] 35. a. The effect of an increase in aggregate demand on output and the price level depends on the shape of the aggregate supply curve. Explain this statement.

15 b. Evaluate the likely effects of a falling rate of inflation (or, separately, of deflation) on the performance of an economy [May 08] 36. a. Explain the difference between progressive taxation and regressive taxation. b. Evaluate the possible effects of a decrease in direct taxation on a country s inflation rate, unemployment rate and balance of payments. [Nov 08] 37. a. Explain the possible causes of a rise in the rate of inflation in an economy. b. Evaluate the possible impact on economic performance that may result from a government decision to bring inflation under control. [May 09] 38. a. Explain how the rate of inflation might be measured and the factors which might make accurate measurement difficult b. Evaluate the extent to which an individual government can influence the rate of inflation in its country [Nov 09] 39. a. Explain why a country may wish to reduce its rate of inflation b. Evaluate the likely impact on the economy of relying on higher interest rates to reduce the rate of inflation May 10, 2 TZ1 40. a. Explain why a country may wish to reduce its unemployment rate b. Evaluate the likely impacts on the economy of relying on demandside policies to reduce the unemployment rate May 10, 2, TZ2 41. a. Explain how supply-side improvements to an economy may be achieved through the use of taxes and government spending b. Evaluate the use of supply-side policies to reduce unemployment Nov 10

16 41a. During the global financial crisis of , there was a fall in consumer spending in many countries. a. Explain the factors which might be responsible for causing consumer spending to fall b. Evaluate the possible consequences of falling consumer spending for a country s macroeconomic performance May 11 TZ1 41b. a. Explain two policies a government might use to redistribute income b. Measures to promote greater income equality should be a key feature of government economic policy. Evaluate this statement. May 11 TZ2 42. During the global financial crisis of , there was a fall in consumer spending in many countries. a. Explain the factors which might be responsible for causing consumer spending to fall b. Evaluate the possible consequences of falling consumer spending for a country s macroeconomic performance May 2012 TZ1 42a. a. Explain why governments may view deflation as a threat b. Evaluate the view that a low and stable rate of inflation is beneficial for an economy May 12 TZ1 43. a. Explain why governments may pursue the macroeconomic goals of low inflation and low unemployment b. Evaluate the extent to which the use of expansionary demand-side policies may lead to conflicts between the various goals of macroeconomic policy May 12 TZ2 44. a. Explain how a government could bring about a more equal distribution of income b. Evaluate the effectiveness of government policies designed to reduce inequalities in income Nov 12

17 44a. a. Explain what might happen to the level of inflation if a government decides to move from a budget surplus to a budget deficit b. To what extent is an increase in interest rates the most effective cure for inflation? Specimen for May 13 44b. a. Analyze the methods by which GDP may be measured b. Using real GDP data, is a very useful means of comparing economic activity between countries. Discuss this statement. Specimen for May a. Explain why the market system may not result in an equitable distribution of income b. Evaluate government policies to promote equity in terms of their effects on efficiency in the allocation of resources May a. Using a diagram, explain how expansionary monetary policy might be used to close a deflationary (recessionary) gap b. Discuss why, in contrast to the monetarist / new classical model, an economy can remain stuck in a deflationary gap according to the Keynesian model May 13 TZ2 47. a. Explain how labor market reforms may be used to promote economic growth b. Market-oriented supply-side policies will always be more effective in promoting economic growth than demand-side policies. To what extent do you agree with this statement? May 13 TZ2 49. a. Explain how changes in the size of the circular flow depend on the relative size of injections and leakages b. Evaluate the use of national income statistics for making comparisons of the standard of living over time Nov a. Explain why measuring the rate of inflation using a consumer price index (CPI) may not be accurate b. Evaluate two government policies to reduce inflation Nov 13

18 51. a. Using two AD/As diagrams, explain cost=push and demand-pull inflation b. The rate of inflation can be most effectively reduced through the use of monetary policy. To what extent do you agree with this statement? May 14 TZ1 52. a. Explain two factors which might cause economic growth b. Evaluate the view that the benefits of economic growth will always outweigh the costs. May 14 TZ1 53. a. Distinguish between structural and demand-deficient (cyclical) unemployment b. Discuss the view that the problem of unemployment can be reduced through the use of supply-side policies Nov a. Using an appropriate diagram, explain how a recession might lead to more poverty b. Evaluate the view that attempts to achieve greater equity in the distribution of income will reduce economic efficiency Nov a. Explain what is meant by natural rate of unemployment b. Discuss the view that there is no trade-off between inflation and unemployment TZ1 May a. Explain how business spending on research and development and government expenditure on infrastructure might shift the ong-run aggregate supply curve b. Evaluate the effectiveness of interventionist supply-side policies to achieve economic growth TZ1 May a. Using the concept of the Keynesian multiplier, explain the possible impact of a rise in government spending on economic growth

19 b. To what extent might unemployment represent an economic and social problem? TZ2 May Nov 15

Exam practice: paper 1 (SL and HL)

Exam practice: paper 1 (SL and HL) Exam practice: paper 1 (SL and HL) Introduction to paper 1 Paper 1 has the same structure for both standard and higher levels. Paper 1: SL and HL Duration of paper 1 Focus and structure of paper 1 1 hour

More information

Paper 1 (SL and HL) markschemes

Paper 1 (SL and HL) markschemes Paper 1 (SL and HL) markschemes Examples of markschemes for Exam practice: paper 1 in the Economics for the IB Diploma CD-ROM are provided below. Paper 1 section A: Microeconomics Chapter 2 Competitive

More information

SAMPLE COURSE OUTLINE ECONOMICS ATAR YEAR 11

SAMPLE COURSE OUTLINE ECONOMICS ATAR YEAR 11 SAMPLE COURSE OUTLINE ECONOMICS ATAR YEAR 11 Copyright School Curriculum and Standards Authority, 2014 This document apart from any third party copyright material contained in it may be freely copied,

More information

Subject CT7 Business Economics Core Technical Syllabus

Subject CT7 Business Economics Core Technical Syllabus Subject CT7 Business Economics Core Technical Syllabus for the 2016 exams 1 June 2015 Aim The aim of the Business Economics subject is to introduce students to the core economic principles and how these

More information

FBLA: ECONOMICS. Competency: Basic Economic Concepts and Principles

FBLA: ECONOMICS. Competency: Basic Economic Concepts and Principles Competency: Basic Economic Concepts and Principles 1. Define money (characteristics, role, and forms) and trace how money and resources flow through the American economic system. 2. Utilize decision-making

More information

AS Economics Unit 1: Markets and Market Failure Syllabus, Key Terms & Charts

AS Economics Unit 1: Markets and Market Failure Syllabus, Key Terms & Charts AS Economics Unit 1: Markets and Market Failure Syllabus, Key Terms & Charts 10.1 The Economic Problem The Nature and Purpose of Economic Activity The central purpose of economic activity is the production

More information

PBL: Economic Analysis & Decision Making. Competency: Comparative Economic Systems. Competency: History of Economic Thought

PBL: Economic Analysis & Decision Making. Competency: Comparative Economic Systems. Competency: History of Economic Thought Competency: Comparative Economic Systems 1. Use basic economic concepts (e.g., supply and demand; production, distribution, and consumption; labor, wages, and capital; inflation and deflation; market economy

More information

Thinkwell s Homeschool Economics Course Lesson Plan: 36 weeks

Thinkwell s Homeschool Economics Course Lesson Plan: 36 weeks Thinkwell s Homeschool Economics Course Lesson Plan: 36 weeks Welcome to Thinkwell s Homeschool Economics! We re thrilled that you ve decided to make us part of your homeschool curriculum. This lesson

More information

Economics Course Title

Economics Course Title Economics Course Title Course-wide Enduring Understandings Economic decision- making requires making choices about cost, benefits and allocation of resources. Economic systems develop and change because

More information

ECONOMIC QUESTIONS FOR THE MASTER'S EXAM

ECONOMIC QUESTIONS FOR THE MASTER'S EXAM ECONOMIC QUESTIONS FOR THE MASTER'S EXAM Introduction 1. What is economics? Discuss the purpose and method of work of economists. Consider observation, induction, deduction and scientific criticism. 2.

More information

DRAFT SOCIAL STUDIES Georgia Standards of Excellence (GSE) Economics

DRAFT SOCIAL STUDIES Georgia Standards of Excellence (GSE) Economics DRAFT SOCIAL STUDIES Economics Economics Economics is the study of how individuals, businesses, and governments make decisions about the allocation of scarce resources. The economics course provides students

More information

Learner Guide. Cambridge IGCSE Economics

Learner Guide. Cambridge IGCSE Economics Learner Guide Cambridge IGCSE Economics 0455 Cambridge International Examinations retains the copyright on all its publications. Registered Centres are permitted to copy material from this booklet for

More information

CHAPTER 7: AGGREGATE DEMAND AND AGGREGATE SUPPLY

CHAPTER 7: AGGREGATE DEMAND AND AGGREGATE SUPPLY CHAPTER 7: AGGREGATE DEMAND AND AGGREGATE SUPPLY Learning goals of this chapter: What forces bring persistent and rapid expansion of real GDP? What causes inflation? Why do we have business cycles? How

More information

Macroeconomics 2301 Potential questions and study guide for exam 2. Any 6 of these questions could be on your exam!

Macroeconomics 2301 Potential questions and study guide for exam 2. Any 6 of these questions could be on your exam! Macroeconomics 2301 Potential questions and study guide for exam 2 Any 6 of these questions could be on your exam! 1. GDP is a key concept in Macroeconomics. a. What is the definition of GDP? b. List and

More information

Ec1 ECONOMICS PAPER 1. INSTRUCTIONS TO CANDIDATES: (To be read out by the external invigilator before the start of the examination)

Ec1 ECONOMICS PAPER 1. INSTRUCTIONS TO CANDIDATES: (To be read out by the external invigilator before the start of the examination) INSTRUCTIONS TO CANDIDATES: (To be read out by the external invigilator before the start of the examination) DEPARTMENT OF EDUCATION HIGHER SCHOOL CERTIFICATE EXAMINATIONS ECONOMICS PAPER 1 Monday 23 October

More information

There are 10 Internal Credits AS 91401 V1 (3.3) 5 credits: Elasticity & micro-economic concepts Literacy

There are 10 Internal Credits AS 91401 V1 (3.3) 5 credits: Elasticity & micro-economic concepts Literacy Year 13 Economics Course Outline This course will cover the micro-economic issues of Market efficiency, Elasticity, Government intervention, Market failure and macroeconomic Influences on NZ economy. There

More information

AS Economics. Introductory Macroeconomics. Sixth Form pre-reading

AS Economics. Introductory Macroeconomics. Sixth Form pre-reading AS Economics Introductory Macroeconomics Sixth Form pre-reading National income National income (Y) = money value of goods and services produced in an economy over a period of time, usually one year. National

More information

Government Budget and Fiscal Policy CHAPTER

Government Budget and Fiscal Policy CHAPTER Government Budget and Fiscal Policy 11 CHAPTER The National Budget The national budget is the annual statement of the government s expenditures and tax revenues. Fiscal policy is the use of the federal

More information

Economic Systems. 1. MARKET ECONOMY in comparison to 2. PLANNED ECONOMY

Economic Systems. 1. MARKET ECONOMY in comparison to 2. PLANNED ECONOMY Economic Systems The way a country s resources are owned and the way that country takes decisions as to what to produce, how much to produce and how to distribute what has been produced determine the type

More information

Economic Policy. Economic policy has 3 main goals

Economic Policy. Economic policy has 3 main goals MACROECONOMIC POLICY Functions of State Economic Policy (Policy Goals) Instruments of Economic Policy (Policy Tools) Types of Economic Policy Efficiency of Economic Policy Economic Policy Economic policy

More information

What is fiscal policy? Fiscal policy is the use of government spending and taxation to influence the level of aggregate demand and economic activity

What is fiscal policy? Fiscal policy is the use of government spending and taxation to influence the level of aggregate demand and economic activity Macroeconomic policy Fiscal Policy What is fiscal policy? Fiscal policy is the use of government spending and taxation to influence the level of aggregate demand and economic activity List the main types

More information

AS Economics. Government Intervention in Markets An Introduction. tutor2u Supporting Teachers: Inspiring Students. Economics Revision Focus: 2004

AS Economics. Government Intervention in Markets An Introduction. tutor2u Supporting Teachers: Inspiring Students. Economics Revision Focus: 2004 Supporting Teachers: Inspiring Students Economics Revision Focus: 2004 AS Economics An Introduction tutor2u (www.tutor2u.net) is the leading free online resource for Economics, Business Studies, ICT and

More information

specification AS/A Level GCE GCE Economics version 4 September 2013 OCR Advanced Subsidiary GCE in Economics H061 OCR Advanced GCE in Economics H461

specification AS/A Level GCE GCE Economics version 4 September 2013 OCR Advanced Subsidiary GCE in Economics H061 OCR Advanced GCE in Economics H461 AS/A Level GCE GCE Economics OCR Advanced Subsidiary GCE in Economics H061 OCR Advanced GCE in Economics H461 version 4 September 2013 specification OCR 2013 QAN 500/2301/9 QAN 500/2213/1 Contents 1 About

More information

Government intervention

Government intervention Government intervention Explain the term free market. In a free market, governments stand back and let the forces of supply and demand determine price and output. There is no direct (eg regulations) or

More information

S.Y.B.COM. (SEM-III) ECONOMICS

S.Y.B.COM. (SEM-III) ECONOMICS Fill in the Blanks. Module 1 S.Y.B.COM. (SEM-III) ECONOMICS 1. The continuous flow of money and goods and services between firms and households is called the Circular Flow. 2. Saving constitute a leakage

More information

Introduction to microeconomics

Introduction to microeconomics RELEVANT TO ACCA QUALIFICATION PAPER F1 / FOUNDATIONS IN ACCOUNTANCY PAPER FAB Introduction to microeconomics The new Paper F1/FAB, Accountant in Business carried over many subjects from its Paper F1 predecessor,

More information

Each correct answer will score one mark. A mark will not be deducted for a wrong answer. Any rough working should be done in this booklet.

Each correct answer will score one mark. A mark will not be deducted for a wrong answer. Any rough working should be done in this booklet. *0299776260* ambridge International Examinations ambridge International dvanced Level ENMIS 9708/33 Paper 3 Multiple hoice (Supplement) May/June 2014 dditional Materials: Multiple hoice nswer Sheet Soft

More information

7 AGGREGATE SUPPLY AND AGGREGATE DEMAND* Chapter. Key Concepts

7 AGGREGATE SUPPLY AND AGGREGATE DEMAND* Chapter. Key Concepts Chapter 7 AGGREGATE SUPPLY AND AGGREGATE DEMAND* Key Concepts Aggregate Supply The aggregate production function shows that the quantity of real GDP (Y ) supplied depends on the quantity of labor (L ),

More information

2.3 Macroeconomic Objectives Ruru Hoong Oct 2014

2.3 Macroeconomic Objectives Ruru Hoong Oct 2014 2.3 Macroeconomic Objectives Low Unemployment Unemployment: people of working age who are actively looking for a job and able to work, but who are not employed. Unemployment rate: number of people unemployed

More information

BASIC MARKET ELEMENTS. Supply Demand Price Competition

BASIC MARKET ELEMENTS. Supply Demand Price Competition BASIC MARKET ELEMENTS Supply Demand Price Competition Supply Supply is the quantity of goods that firms are willing to produce and sale with respect to the market price when all other conditions (like

More information

Practice Multiple Choice Questions Answers are bolded. Explanations to come soon!!

Practice Multiple Choice Questions Answers are bolded. Explanations to come soon!! Practice Multiple Choice Questions Answers are bolded. Explanations to come soon!! For more, please visit: http://courses.missouristate.edu/reedolsen/courses/eco165/qeq.htm Market Equilibrium and Applications

More information

A. a change in demand. B. a change in quantity demanded. C. a change in quantity supplied. D. unit elasticity. E. a change in average variable cost.

A. a change in demand. B. a change in quantity demanded. C. a change in quantity supplied. D. unit elasticity. E. a change in average variable cost. 1. The supply of gasoline changes, causing the price of gasoline to change. The resulting movement from one point to another along the demand curve for gasoline is called A. a change in demand. B. a change

More information

Chapter 10 Fiscal Policy Macroeconomics In Context (Goodwin, et al.)

Chapter 10 Fiscal Policy Macroeconomics In Context (Goodwin, et al.) Chapter 10 Fiscal Policy Macroeconomics In Context (Goodwin, et al.) Chapter Overview This chapter introduces you to a formal analysis of fiscal policy, and puts it in context with real-world data and

More information

MULTIPLE CHOICE. Choose the one alternative that best completes the statement or answers the question.

MULTIPLE CHOICE. Choose the one alternative that best completes the statement or answers the question. Suvey of Macroeconomics, MBA 641 Fall 2006, Final Exam Name MULTIPLE CHOICE. Choose the one alternative that best completes the statement or answers the question. 1) Modern macroeconomics emerged from

More information

MULTIPLE CHOICE. Choose the one alternative that best completes the statement or answers the question.

MULTIPLE CHOICE. Choose the one alternative that best completes the statement or answers the question. MBA 640 Survey of Microeconomics Fall 2006, Quiz 6 Name MULTIPLE CHOICE. Choose the one alternative that best completes the statement or answers the question. 1) A monopoly is best defined as a firm that

More information

CHAPTER 12 MARKETS WITH MARKET POWER Microeconomics in Context (Goodwin, et al.), 2 nd Edition

CHAPTER 12 MARKETS WITH MARKET POWER Microeconomics in Context (Goodwin, et al.), 2 nd Edition CHAPTER 12 MARKETS WITH MARKET POWER Microeconomics in Context (Goodwin, et al.), 2 nd Edition Chapter Summary Now that you understand the model of a perfectly competitive market, this chapter complicates

More information

Economics. Total marks 100

Economics. Total marks 100 2012 HIGHER SCHOOL CERTIFICATE EXAMINATION Economics Total marks 100 Section I Pages 2 8 20 marks Attempt Questions 1 20 Allow about 35 minutes for this section General Instructions Reading time 5 minutes

More information

The Aggregate Demand- Aggregate Supply (AD-AS) Model

The Aggregate Demand- Aggregate Supply (AD-AS) Model The AD-AS Model The Aggregate Demand- Aggregate Supply (AD-AS) Model Chapter 9 The AD-AS Model addresses two deficiencies of the AE Model: No explicit modeling of aggregate supply. Fixed price level. 2

More information

2010 Alabama Course of Study for Social Studies - Economics & Common Core Standards for Literacy in History/Social Studies

2010 Alabama Course of Study for Social Studies - Economics & Common Core Standards for Literacy in History/Social Studies Two Correlations Economics Alabama Edition 2015 To the 2010 Alabama Course of Study for Social Studies - Economics & Common Core Standards for Literacy in History/Social Studies Table of Contents Alabama

More information

Chapter 7 Monopoly, Oligopoly and Strategy

Chapter 7 Monopoly, Oligopoly and Strategy Chapter 7 Monopoly, Oligopoly and Strategy After reading Chapter 7, MONOPOLY, OLIGOPOLY AND STRATEGY, you should be able to: Define the characteristics of Monopoly and Oligopoly, and explain why the are

More information

Econ 303: Intermediate Macroeconomics I Dr. Sauer Sample Questions for Exam #3

Econ 303: Intermediate Macroeconomics I Dr. Sauer Sample Questions for Exam #3 Econ 303: Intermediate Macroeconomics I Dr. Sauer Sample Questions for Exam #3 1. When firms experience unplanned inventory accumulation, they typically: A) build new plants. B) lay off workers and reduce

More information

The Role of Government in the Economy

The Role of Government in the Economy The Role of Government in the Economy The government provides the legal framework and services needed for the effective operation of a market economy. In the context of economic development, that mission

More information

AS Economics. Unemployment. tutor2u Supporting Teachers: Inspiring Students. Economics Revision Focus: 2004

AS Economics. Unemployment. tutor2u Supporting Teachers: Inspiring Students. Economics Revision Focus: 2004 Supporting Teachers: Inspiring Students Economics Revision Focus: 2004 AS Economics tutor2u (www.tutor2u.net) is the leading free online resource for Economics, Business Studies, ICT and Politics. Don

More information

Edmonds Community College Macroeconomic Principles ECON 202C - Winter 2011 Online Course Instructor: Andy Williams

Edmonds Community College Macroeconomic Principles ECON 202C - Winter 2011 Online Course Instructor: Andy Williams Edmonds Community College Macroeconomic Principles ECON 202C - Winter 2011 Online Course Instructor: Andy Williams Textbooks: Economics: Principles, Problems and Policies, 18th Edition, by McConnell, Brue,

More information

a) Policies to achieve efficient resource allocation and correct market failure Indirect Taxes CIE A-level Economics

a) Policies to achieve efficient resource allocation and correct market failure Indirect Taxes CIE A-level Economics a) Policies to achieve efficient resource allocation and correct market failure Indirect Taxes Indirect taxes are imposed by the government and they increase production costs for producers. Therefore,

More information

MULTIPLE CHOICE. Choose the one alternative that best completes the statement or answers the question.

MULTIPLE CHOICE. Choose the one alternative that best completes the statement or answers the question. Chap 13 Monopolistic Competition and Oligopoly These questions may include topics that were not covered in class and may not be on the exam. MULTIPLE CHOICE. Choose the one alternative that best completes

More information

CARIBBEAN EXAMINATIONS COUNCIL REPORT ON CANDIDATES WORK IN THE CARIBBEAN ADVANCED PROFICIENCY EXAMINATION MAY/JUNE 2013 ECONOMICS

CARIBBEAN EXAMINATIONS COUNCIL REPORT ON CANDIDATES WORK IN THE CARIBBEAN ADVANCED PROFICIENCY EXAMINATION MAY/JUNE 2013 ECONOMICS CARIBBEAN EXAMINATIONS COUNCIL REPORT ON CANDIDATES WORK IN THE CARIBBEAN ADVANCED PROFICIENCY EXAMINATION MAY/JUNE 2013 ECONOMICS Copyright 2013 Caribbean Examinations Council St Michael, Barbados All

More information

Total Test Questions: 80 Levels: Grades Units of Credit:.50

Total Test Questions: 80 Levels: Grades Units of Credit:.50 DESCRIPTION This course focuses on the study of economic problems and the methods by which societies solve them. Characteristics of the market economy of the United States and its function in the world

More information

ASSIGNMENT 1 ST SEMESTER : MACROECONOMICS (MAC) ECONOMICS 1 (ECO101) STUDY UNITS COVERED : STUDY UNITS 1 AND 2. DUE DATE : 3:00 p.m.

ASSIGNMENT 1 ST SEMESTER : MACROECONOMICS (MAC) ECONOMICS 1 (ECO101) STUDY UNITS COVERED : STUDY UNITS 1 AND 2. DUE DATE : 3:00 p.m. Page 1 of 13 ASSIGNMENT 1 ST SEMESTER : MACROECONOMICS (MAC) ECONOMICS 1 (ECO101) STUDY UNITS COVERED : STUDY UNITS 1 AND 2 DUE DATE : 3:00 p.m. 19 MARCH 2013 TOTAL MARKS : 100 INSTRUCTIONS TO CANDIDATES

More information

b. Cost of Any Action is measure in foregone opportunities c.,marginal costs and benefits in decision making

b. Cost of Any Action is measure in foregone opportunities c.,marginal costs and benefits in decision making 1 Economics 130-Windward Community College Review Sheet for the Final Exam This final exam is comprehensive in nature and in scope. The test will be divided into two parts: a multiple-choice section and

More information

The labour market, I: real wages, productivity and unemployment 7.1 INTRODUCTION

The labour market, I: real wages, productivity and unemployment 7.1 INTRODUCTION 7 The labour market, I: real wages, productivity and unemployment 7.1 INTRODUCTION Since the 1970s one of the major issues in macroeconomics has been the extent to which low output and high unemployment

More information

2.5 Monetary policy: Interest rates

2.5 Monetary policy: Interest rates 2.5 Monetary policy: Interest rates Learning Outcomes Describe the role of central banks as regulators of commercial banks and bankers to governments. Explain that central banks are usually made responsible

More information

The Economic Environment for Business

The Economic Environment for Business B. FINANCIAL MANAGEMENT ENVIRONMENT 1. The economic environment for business 2. The nature and role of financial markets and institutions The Economic Environment for Business What are the targets of macroeconomic

More information

Chapter 12 Unemployment and Inflation

Chapter 12 Unemployment and Inflation Chapter 12 Unemployment and Inflation Multiple Choice Questions 1. The origin of the idea of a trade-off between inflation and unemployment was a 1958 article by (a) A.W. Phillips. (b) Edmund Phelps. (c)

More information

Chapter 7: Market Structures Section 1

Chapter 7: Market Structures Section 1 Chapter 7: Market Structures Section 1 Key Terms perfect competition: a market structure in which a large number of firms all produce the same product and no single seller controls supply or prices commodity:

More information

2 0 0 0 E D I T I O N CLEP O F F I C I A L S T U D Y G U I D E. The College Board. College Level Examination Program

2 0 0 0 E D I T I O N CLEP O F F I C I A L S T U D Y G U I D E. The College Board. College Level Examination Program 2 0 0 0 E D I T I O N CLEP O F F I C I A L S T U D Y G U I D E College Level Examination Program The College Board Principles of Macroeconomics Description of the Examination The Subject Examination in

More information

THE UNIVERSITY OF AUCKLAND

THE UNIVERSITY OF AUCKLAND THE UNIVERSITY OF AUCKLAND FIRST SEMESTER, 2013 Campus: City ECONOMICS Business Economics (Time Allowed: THREE hours) NOTE: Answer ALL questions Total marks = 100 PRACTICE PAPER ONLY This is a practice

More information

B.A. PROGRAMME DISCIPLINE COURSE ECONOMICS. COURSE CONTENTS (Effective from the Academic Year 2011-2012 onwards)

B.A. PROGRAMME DISCIPLINE COURSE ECONOMICS. COURSE CONTENTS (Effective from the Academic Year 2011-2012 onwards) B.A. PROGRAMME DISCIPLINE COURSE ECONOMICS COURSE CONTENTS (Effective from the Academic Year 2011-2012 onwards) DEPARTMENT OF ECONOMICS UNIVERSITY OF DELHI DELHI 1 Syllabus for B.A. Programme - Economics

More information

Chapter 6 Supply, Demand, and Government Policies

Chapter 6 Supply, Demand, and Government Policies Chapter 6 Supply, Demand, and Government Policies Review Questions Using supply-demand diagrams, show the difference between a non-binding price ceiling and a binding price ceiling in the wheat market.

More information

Macroeconomics Machine-graded Assessment Items Module: Fiscal Policy

Macroeconomics Machine-graded Assessment Items Module: Fiscal Policy Macroeconomics Machine-graded Assessment Items Module: Fiscal Policy Machine-graded assessment question pools are provided for your reference and are organized by learning outcome. It is your responsibility

More information

Student Name: Date: Teacher Name: Heather Creamer. Score:

Student Name: Date: Teacher Name: Heather Creamer. Score: Economics EOC Quiz Answer Key Microeconomic Concepts - (SSEMI1) Flow Of Goods, (SSEMI2) Law Of Demand, (SSEMI3) Economic Behavior, (SSEMI4) Organization And Role Of Business Student Name: Teacher Name:

More information

GCE Economics Candidate Exemplar Work ECON4: The National and International Economy

GCE Economics Candidate Exemplar Work ECON4: The National and International Economy hij Teacher Resource Bank GCE Economics Candidate Exemplar Work ECON4: The National and International Economy The Assessment and Qualifications Alliance (AQA) is a company limited by guarantee registered

More information

Market Equilibrium and Applications

Market Equilibrium and Applications Market Equilibrium and Applications I. Market Equilibrium In the previous chapter, we discussed demand and supply, both for individual consumers and firms and for markets. In this chapter, we will combine

More information

Economics 100 Examination #1 Total Score

Economics 100 Examination #1 Total Score Economics 100 Examination #1 Name Total Score 1. Consider grocery stores in an area mainly populated by elderly people. People who live in this neighborhood shop there because they cannot afford to go

More information

Sample Question Paper (Set-2) Economics (030) Class XII (2015-16) Section A: Microeconomics

Sample Question Paper (Set-2) Economics (030) Class XII (2015-16) Section A: Microeconomics Sample Question Paper (Set-2) Economics (030) Class XII (2015-16) Time : 3 Hours Maximum Marks : 100 Instructions: 1. All questions in both sections are compulsory. However, there is internal choice in

More information

Economics 101 Multiple Choice Questions for Final Examination Miller

Economics 101 Multiple Choice Questions for Final Examination Miller Economics 101 Multiple Choice Questions for Final Examination Miller PLEASE DO NOT WRITE ON THIS EXAMINATION FORM. 1. Which of the following statements is correct? a. Real GDP is the total market value

More information

Pre-Test Chapter 11 ed17

Pre-Test Chapter 11 ed17 Pre-Test Chapter 11 ed17 Multiple Choice Questions 1. Built-in stability means that: A. an annually balanced budget will offset the procyclical tendencies created by state and local finance and thereby

More information

a) Aggregate Demand (AD) and Aggregate Supply (AS) analysis

a) Aggregate Demand (AD) and Aggregate Supply (AS) analysis a) Aggregate Demand (AD) and Aggregate Supply (AS) analysis Determinants of AD: Aggregate demand is the total demand in the economy. It measures spending on goods and services by consumers, firms, the

More information

Introduction to Agricultural Economics

Introduction to Agricultural Economics Introduction to Agricultural Economics Economics examines: how scarce resources are allocated. how firms maximize profits. how market competition affects firms and consumers. the limitations of markets.

More information

Paper 2 (SL and HL) markschemes

Paper 2 (SL and HL) markschemes Paper 2 (SL and HL) markschemes Examples of markschemes for Exam practice: paper 2 in the Economics for the IB Diploma CD-ROM are provided below. Paper 2 section A: International economics Chapter 13 International

More information

Note: This feature provides supplementary analysis for the material in Part 3 of Common Sense Economics.

Note: This feature provides supplementary analysis for the material in Part 3 of Common Sense Economics. 1 Module C: Fiscal Policy and Budget Deficits Note: This feature provides supplementary analysis for the material in Part 3 of Common Sense Economics. Fiscal and monetary policies are the two major tools

More information

Econ 111 (04) 2nd Midterm A

Econ 111 (04) 2nd Midterm A Econ 111 (04) 2nd Midterm A MULTIPLE CHOICE. Choose the one alternative that best completes the statement or answers the question. 1) Which one of the following does not occur in perfect competition? A)

More information

Tutor2u Economics Essay Plans Summer 2002

Tutor2u Economics Essay Plans Summer 2002 Macroeconomics Revision Essay Plan (2): Inflation and Unemployment and Economic Policy (a) Explain why it is considered important to control inflation (20 marks) (b) Discuss how a government s commitment

More information

MULTIPLE CHOICE. Choose the one alternative that best completes the statement or answers the question on the accompanying scantron.

MULTIPLE CHOICE. Choose the one alternative that best completes the statement or answers the question on the accompanying scantron. Principles of Microeconomics Fall 2007, Quiz #6 Name MULTIPLE CHOICE. Choose the one alternative that best completes the statement or answers the question on the accompanying scantron. 1) A monopoly is

More information

WorldView Software. Economics. West Virginia Correlation Document

WorldView Software. Economics. West Virginia Correlation Document WorldView Software Economics West Virginia Correlation Document 76 North Broadway, Suite 2002, Hicksville, NY 11801 516-681-1773 history@worldviewsoftware.com West Virginia Economics Standards Economics

More information

ECO 2251 PRINCIPLES OF MACROECONOMICS I Section: TEWA Fall Semester 2010

ECO 2251 PRINCIPLES OF MACROECONOMICS I Section: TEWA Fall Semester 2010 ECO 2251 PRINCIPLES OF MACROECONOMICS I Section: TEWA Fall Semester 2010 Instructor: Course Prerequisites: Office Hours: Phillip Mixon Assistant Professor of Economics Center for International Business

More information

Extreme cases. In between cases

Extreme cases. In between cases CHAPTER 16 OLIGOPOLY FOUR TYPES OF MARKET STRUCTURE Extreme cases PERFECTLY COMPETITION Many firms No barriers to entry Identical products MONOPOLY One firm Huge barriers to entry Unique product In between

More information

CARIBBEAN EXAMINATIONS COUNCIL

CARIBBEAN EXAMINATIONS COUNCIL CARIBBEAN EXAMINATIONS COUNCIL Caribbean Advanced Proficiency Examination CAPE ECONOMICS SYLLABUS Effective for examinations from May/June 2010 Published by the Caribbean Examinations Council All rights

More information

With lectures 1-8 behind us, we now have the tools to support the discussion and implementation of economic policy.

With lectures 1-8 behind us, we now have the tools to support the discussion and implementation of economic policy. The Digital Economist Lecture 9 -- Economic Policy With lectures 1-8 behind us, we now have the tools to support the discussion and implementation of economic policy. There is still great debate about

More information

ADVANCED SUBSIDIARY (AS) General Certificate of Education Economics Assessment Unit AS 1. assessing. Markets and Prices [AE111]

ADVANCED SUBSIDIARY (AS) General Certificate of Education Economics Assessment Unit AS 1. assessing. Markets and Prices [AE111] ADVANCED SUBSIDIARY (AS) General Certificate of Education 2012 Economics Assessment Unit AS 1 assessing Markets and Prices [AE111] TUESDAY 12 JUNE, AFTERNOON MARK SCHEME 7395.01 General Marking Instructions

More information

as a function of E D and E S can be looked as follows:

as a function of E D and E S can be looked as follows: TOPIC IV: MARKETS IN ACTION - Applications of S&D and E D &E S A. Using E D and E S to increase our understanding of the impact of a change in S or D. B. Price ceilings and price floors C. Trade quotas

More information

FISCAL POLICY* Chapter. Key Concepts

FISCAL POLICY* Chapter. Key Concepts Chapter 15 FISCAL POLICY* Key Concepts The Federal Budget The federal budget is an annual statement of the government s expenditures and tax revenues. Using the federal budget to achieve macroeconomic

More information

I. Introduction to Aggregate Demand/Aggregate Supply Model

I. Introduction to Aggregate Demand/Aggregate Supply Model University of California-Davis Economics 1B-Intro to Macro Handout 8 TA: Jason Lee Email: jawlee@ucdavis.edu I. Introduction to Aggregate Demand/Aggregate Supply Model In this chapter we develop a model

More information

chapter >> Consumer and Producer Surplus Section 3: Consumer Surplus, Producer Surplus, and the Gains from Trade

chapter >> Consumer and Producer Surplus Section 3: Consumer Surplus, Producer Surplus, and the Gains from Trade chapter 6 >> Consumer and Producer Surplus Section 3: Consumer Surplus, Producer Surplus, and the Gains from Trade One of the nine core principles of economics we introduced in Chapter 1 is that markets

More information

ECONOMICS & THE BUSINESS ENVIRONMENT

ECONOMICS & THE BUSINESS ENVIRONMENT ECONOMICS & THE BUSINESS ENVIRONMENT FORMATION 1 EXAMINATION - AUGUST 2011 NOTES: You are required to answer Question 1. You are also required to answer any three out of Questions 2 to 5. (If you provide

More information

As you discovered in Chapter 10, unemployment and inflation impose costs

As you discovered in Chapter 10, unemployment and inflation impose costs Keynes and the Classical Economists: The Early Debate on Policy Activism LEARNING OBJECTIVES 1. Discuss why the classical economists believed that a market economy would automatically tend toward full

More information

1. Supply and demand are the most important concepts in economics.

1. Supply and demand are the most important concepts in economics. Page 1 1. Supply and demand are the most important concepts in economics. 2. Markets and Competition a. Market is a group of buyers and sellers of a particular good or service. P. 66. b. These individuals

More information

Economics. Social Studies Curriculum Framework. Revised 2006 Amended June 2009

Economics. Social Studies Curriculum Framework. Revised 2006 Amended June 2009 Economics Social Studies Curriculum Framework Revised 2006 Course Title: Economics Course/Unit Credit: 0.5 Course Number: 4743000 Teacher Licensure: Please refer to the Course Code Management System (https://adedata.arkansas.gov/ccms/)

More information

Chapter 11. Keynesianism: The Macroeconomics of Wage and Price Rigidity. 2008 Pearson Addison-Wesley. All rights reserved

Chapter 11. Keynesianism: The Macroeconomics of Wage and Price Rigidity. 2008 Pearson Addison-Wesley. All rights reserved Chapter 11 Keynesianism: The Macroeconomics of Wage and Price Rigidity Chapter Outline Real-Wage Rigidity Price Stickiness Monetary and Fiscal Policy in the Keynesian Model The Keynesian Theory of Business

More information

Miami Dade College ECO 2013.003 Principles of Macroeconomics - Fall 2014 Practice Test #2

Miami Dade College ECO 2013.003 Principles of Macroeconomics - Fall 2014 Practice Test #2 Miami Dade College ECO 2013.003 Principles of Macroeconomics - Fall 2014 Practice Test #2 1. Whose analysis serves as the foundation of modern macroeconomics? A) Milton Friedman B) John Maynard Keynes

More information

1. Firms react to unplanned inventory investment by increasing output.

1. Firms react to unplanned inventory investment by increasing output. Macro Exam 2 Self Test -- T/F questions Dr. McGahagan Fill in your answer (T/F) in the blank in front of the question. If false, provide a brief explanation of why it is false, and state what is true.

More information

4. Which of the following are available in limited quantity and contribute to the problem of scarcity?

4. Which of the following are available in limited quantity and contribute to the problem of scarcity? 1. Given that resources are scarce: A) A "free lunch" is possible but only for a limited number of people B) Poor countries must make choices but rich countries do not have to make choices C) Opportunity

More information

Chapter 18. MODERN PRINCIPLES OF ECONOMICS Third Edition

Chapter 18. MODERN PRINCIPLES OF ECONOMICS Third Edition Chapter 18 MODERN PRINCIPLES OF ECONOMICS Third Edition Fiscal Policy Outline Fiscal Policy: The Best Case The Limits to Fiscal Policy When Fiscal Policy Might Make Matters Worse So When Is Fiscal Policy

More information

Economics 152 Solution to Sample Midterm 2

Economics 152 Solution to Sample Midterm 2 Economics 152 Solution to Sample Midterm 2 N. Das PART 1 (84 POINTS): Answer the following 28 multiple choice questions on the scan sheet. Each question is worth 3 points. 1. If Congress passes legislation

More information

ECONOMICS GENERAL OBJECTIVES

ECONOMICS GENERAL OBJECTIVES ECONOMICS GENERAL The aim of the Unified Tertiary Matriculation Examination (UTME) syllabus in Economics is to prepare the candidates for the Board s examination. It is designed to test their achievement

More information

* * * 8 NATIONAL INCOME. Unit 1 : National Income Analysis

* * * 8 NATIONAL INCOME. Unit 1 : National Income Analysis 8 NATIONAL INCOME Macro / Topic 8-1 / P. 1 Unit 1 : National Income Analysis I Concepts and Meaning ( Definition ) II Approaches and Formulae III Measurement of GNP IV Economic Analysis of GNP National

More information

ECON 1002: INTRODUCTION TO MACROECONOMICS

ECON 1002: INTRODUCTION TO MACROECONOMICS ECON 1002: INTRODUCTION TO MACROECONOMICS Course Type: Core Level: 1 Semester: 2 No. of credits: 3 Prerequisites: None COURSE DESCRIPTION This is an introductory Macroeconomics course and is one of the

More information

Chapter Outline. Chapter 11. Real-Wage Rigidity. Real-Wage Rigidity

Chapter Outline. Chapter 11. Real-Wage Rigidity. Real-Wage Rigidity Chapter 11 Keynesianism: The Macroeconomics of Wage and Price Rigidity Chapter Outline Real-Wage Rigidity Price Stickiness Monetary and Fiscal Policy in the Keynesian 2008 Pearson Addison-Wesley. All rights

More information

Economics 3422 Sample Final Examination

Economics 3422 Sample Final Examination Economics 3422 Sample Final Examination Instructions: Put your name and PeopleSoft ID on the blue book provided. Put all your answers in the blue book provided. Turn both question sheet and blue book in

More information

Politics, Surpluses, Deficits, and Debt

Politics, Surpluses, Deficits, and Debt Defining Surpluses and Debt Politics, Surpluses,, and Debt Chapter 11 A surplus is an excess of revenues over payments. A deficit is a shortfall of revenues relative to payments. 2 Introduction After having

More information