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29 sample essay responses from across the syllabus - 20-mark questions Indifference curves (1) Perfect competition (2) Market failure (2) Labour market (1) Profit (1) MNCs (4) Economic growth (1) Inflation (6) Unemployment (2) Current account (3) Output gap (1) Standard of living (5)

PPT covering unit 8.2 8.2 Equity and redistribution of income and wealth 8.2.1 difference between equity and equality 8.2.2 difference between equity and efficiency 8.2.3 distinction between absolute poverty and relative poverty 8.2.4 the poverty trap 8.2.5 policies towards equity and equality, for example: • negative income tax • universal benefits and means-tested benefits • universal basic income video links to key topics

9.1 The circular flow of income 9.1.1 the multiplier process: • definition of the multiplier • formulae for and calculation of multiplier in a closed and open economy, with and without a government sector • calculation of: – average and marginal propensities to save (aps and mps) – average and marginal propensities to consume (apc and mpc) – average and marginal propensities to import (apm and mpm) – average and marginal rates of tax (art and mrt) • national income determination using AD and income approach with the multiplier process • calculation of effect of changing AD on national income using the multiplier 9.1.2 components of Aggregate Demand (AD) and their determinants: • consumption function: autonomous and induced consumer expenditure • savings function: autonomous and induced savings • autonomous and induced investment; the accelerator • government spending • net exports (exports minus imports) 9.1.3 full employment level of national income and equilibrium level of national income: • inflationary and deflationary gaps

PPT covering Unit 7.6: 7.6 Different market structures 7.6.1 perfect competition and imperfect competition: monopoly, monopolistic competition, oligopoly, natural monopoly 7.6.2 structure of the listed markets as explained by number of buyers and sellers, product differentiation, degree of freedom of entry and availability of information 7.6.3 barriers to entry and exit: • legal barriers • market barriers • cost barriers • physical barriers 7.6.4 performance of firms in different market structures: • revenues and revenue curves • output in the short run and the long run • profits in the short run and the long run • shutdown price in the short run and the long run • derivation of a firm’s supply curve in a perfectly competitive market • efficiency and X-inefficiency in the short run and the long run • contestable markets: features and implications • price competition and non-price competition • collusion and the Prisoner’s Dilemma in oligopolistic markets, including a two-player pay-off matrix 7.6.5 definition and calculation of the concentration ratio video links to key topics

PPT covering Unit 7.4: 7.4 Private costs and benefits, externalities and social costs and benefits 7.4.1 definition and calculation of social costs (SC) as the sum of private costs (PC) and external costs (EC), including marginal social costs (MSC), marginal private costs (MPC) and marginal external costs (MEC) 7.4.2 definition and calculation of social benefits (SB) as the sum of private benefits (PB) and external benefits (EB), including marginal social benefits (MSB), marginal private benefits (MPB) and marginal external benefits (MEB) 7.4.3 definition of positive externality and negative externality 7.4.4 positive and negative externalities of both consumption and production 7.4.5 deadweight welfare losses arising from positive and negative externalities 7.4.6 asymmetric information and moral hazard 7.4.7 use of costs and benefits in analysing decisions (knowledge of net present value is not required) video links to key topics

5.1.1 The need for business finance: • The main reasons why businesses need finance, e.g. start-up capital, capital for expansion and additional working capital • Understand the difference between short-term and long-term finance needs 5.1.2 The main sources of finance: • Internal sources and external sources with examples • Short-term and long-term sources with examples, e.g. overdraft for short-term finance and debt or equity for long-term finance • Importance of alternative sources of capital, e.g. micro-finance, crowd-funding • The main factors considered in making the financial choice, e.g. size and legal form of business, amount required, length of time, existing loans • Recommend and justify appropriate source(s) of finance in given circumstances questions and suggested answers

6.1.1 Business cycle: • Main stages of the business cycle, e.g. growth, boom, recession, slump • Impact on businesses of changes in employment levels, inflation and Gross Domestic Product (GDP) 6.1.2 How government control over the economy affects business activity and how businesses may respond: • Identify government economic objectives, e.g. increasing Gross Domestic Product (GDP) • Impact of changes in taxes and government spending • Impact of changes in interest rates • How businesses might respond to these changes Questions and suggested answers

Real GDP per head and the Human Development Index (HDI). The components of real GDP and HDI. The advantages and disadvantages of real GDP and HDI. Reasons for differences in living standards and income distribution within and between countries. Questions and suggested answers

Economic growth, full employment/low unemployment, stable prices/low inflation, balance of payments stability, redistribution of income. Reasons behind the choice of aims and the criteria that governments set for each aim. Possible conflicts between aims: full employment versus stable prices; economic growth versus balance of payments stability; and full employment versus balance of payments stability Review of Unit 4 Questions and suggested answers

The main areas of government spending and the reasons for and effects of spending in these areas. Taxation as the main source of government revenue and the reasons for levying taxation. Examples of the different classifications of tax; progressive, regressive, proportional; and direct, indirect. The qualities of a good tax. The impact of taxation on consumers, producers, government and economy as a whole. The tax and spending changes, in the form of fiscal policy, that cause budget balance or imbalance. Including calculations of the size of a budget deficit or surplus. How fiscal policy measures may enable the government to achieve its macroeconomic aims. Note: aggregate demand and aggregate supply are not required. Review of Unit 4 Questions and suggested answers

Including income, the rate of interest and confidence between different households and over time. Questions with suggested solutions

The difference between absolute and relative poverty. The causes of poverty including unemployment, low wages, illness and age. Policies including those promoting economic growth, improved education, more generous state benefits, progressive taxation, and national minimum wage. Questions and suggested answers

The difference between microeconomics and macroeconomics and the decision makers involved in each.

4.1.1 The meaning of production: • Managing resources effectively to produce goods and services • Difference between production and productivity • Benefits of increasing efficiency and how to increase it, e.g. increasing productivity by automation and technology, improved labour skills • Why businesses hold inventories • The concept of lean production: how to achieve it, e.g. just-in-time inventory control and Kaizen; benefits of lean production 4.1.2 The main methods of production: • Features, benefits and limitations of job, batch and flow production • Recommend and justify an appropriate production method for a given situation 4.1.3 How technology has changed production methods, e.g. using computers in design and manufacturing Sample questions and answers

PPT covering: 8.1 Government policies to achieve efficient resource allocation and correct market failure continued 8.1.2 government failure in microeconomic intervention: • definition of government failure • causes of government failure • consequences of government failure 8.2 Equity and redistribution of income and wealth 8.2.1 difference between equity and equality 8.2.2 difference between equity and efficiency 8.2.3 distinction between absolute poverty and relative poverty 8.2.4 the poverty trap 8.2.5 policies towards equity and equality, for example: • negative income tax • universal benefits and means-tested benefits • universal basic income Links to relevant videos

PPT covering the topics of Utility and indifference curves. Each page is question based to determine prior knowledge - good for flipped learning. 7.1 Utility 7.1.1 definition and calculation of total utility and marginal utility 7.1.2 diminishing marginal utility 7.1.3 equi-marginal principle 7.1.4 derivation of an individual demand curve 7.1.5 limitations of marginal utility theory and its assumptions of rational behaviour 7.2 Indifference curves and budget lines 7.2.1 meaning of an indifference curve and a budget line 7.2.2 causes of a shift in the budget line 7.2.3 income, substitution and price effects for normal, inferior and Giffen goods 7.2.4 limitations of the model of indifference curve