Revision/Discussion Thread Edexcel Economics Unit 2 Friday 25th of May 2012

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One possible 30 mark question which I think may come up will be about Unemployment/Employment due to the Olympics. Can someone tell me how to answer the following two questions?

1) Discuss how a increase in Employment will effect the economy? (30)

2) Discuss how the government can achieve higher rates of employment in the economy? (30)

1) an increase in employment will close the current negative output gap the economy has, bring AD up, and a multiplier effect. disadv- BoP will worsen as more import will be demanded../..many people owe money to the banks, thus AD may not rise alot since much of people's income is going to the bank to repay money, so they have little disposable income../..although you can say that olympics may bring in alot of money into the UK from tourists, thus the higher imports demanded may be countered.

2) government can achieve higher employment rates by using demand/supply side policies. disadv- government has a fiscal deficit, more spending will worsen the debt in the long run, inflation is already 3%, higher GDP will further hurt inflation as it goes up, you achieve two macroeconomic objectives, two others get slapped in the face lol (use diagram).

Reply 81

Nilsdejongh

Just looked at a past question and jotted some notes down on how i'd answer.

its the June 2009 Macro Paper - Question 4 of Context 1.

Extract B (lines 11-12) states: ‘When total spending grows more quickly than the
volume of output produced, inflation is the result.’
Assess the view that inflation is always caused by an increase in aggregate demand.
(25 marks)

that is the question..

In the mark scheme it says nothing about talking about how a government would go about reducing inflation.. like using different Fisc and Mon policies

http://store.aqa.org.uk/qual/gce/pdf...W-MS-JUN09.PDF thats the mark scheme there,

i just wanted to ask you guys about how you know what to include in your answer.. like how you know when to talk about how the problems can be solved and the disdvantages to different appproaches.

Reply 82

Mtice

Well.... I'm screwed, just tried looking at some past papers, I know the stuff, but never seem to get what it is they're asking.

Reply 83

lostbenzo

Can someone tell me the difference between HDI rank and HDI index.

Thanks

Reply 84

Jack_Smith

how does marginal propensity to consume have an effect on the multiplier effect?

Reply 85

Warfare

Hey guys my exams tomorrow. I have to start revising now. What do you think will come up? Some topic names i can especially focus on? I need all the help i can get... And does anyone have a list of short word definitions? I desperately require it.

Reply 86

dan94adibi

Predictions on the 30mark question.

Reply 87

smatts

Original post by Jack_Smith

how does marginal propensity to consume have an effect on the multiplier effect?

The greater the MPC, the greater the multiplier effect which = gif.latex.gif

Reply 88

egg123

What essay structures does everyone use for 30 marker?

Reply 89

shaminn

Original post by lostbenzo

Can someone tell me the difference between HDI rank and HDI index.

Thanks

HDI rank is between 1 ( being the best standard of living) up to like 177( being the lowest, 177 is the number for Zimbabwe if I'm right)

Whereas the index is about of 0-1. Where 0 - is unliveable and 1 is the best.

This was posted from The Student Room's iPhone/iPad App

Reply 90

shaminn

Can someone help me evaluate the concept of the Phillips Curve?

This was posted from The Student Room's iPhone/iPad App

Reply 91

Adrianna123

There are some good resources on this thread:

http://www.thestudentroom.co.uk/showthread.php?t=2001068&p=37738014#post37738014

Reply 92

QwertyG

Are past papers worth doing for this unit?

Reply 93

Adrianna123

For a 30mark question:

Analysis (18 marks)
Definition (2 marks)
Diagram (4 marks)
Explanations of policies, transmission mechanisms, multiplier effect, impact on objectives etc. (12marks)

Evaluation (12marks)
Time lags
Magnitude
Elasticity of LRAS curve
Conflicts between objectives

Reply 94

Adrianna123

Original post by QwertyG

Are past papers worth doing for this unit?

Maybe just look at the types of questions and also do some but in bullet point form. Also sometimes looking at the markscheme helps, gives new ideas and you see what they're looking for. :smile:

Reply 95

QwertyG

Original post by Adrianna123

How do you describe the Elasticity for the LSAS curve I do not understand

Reply 96

Adrianna123

Original post by QwertyG

How do you describe the Elasticity for the LSAS curve I do not understand

You'd evaluate by saying 'It depends where the economy lies on the LRAS curve.'
So if it's on the 'elastic' part/spare capacity (horizontal part) then an increase in AD would cause growth and not inflation. If it's on the 'inelastic' part/full employment (vertical part) then an increase in AD would only cause inflation and no growth.
Hope that makes sense. :smile:

Reply 97

Adrianna123