Edexcel Economics unit 1, January 12th 2012.

Also, anybody care to discuss an easy method of remembering all of the evaluation points, like through a mnemonic ect

That should be fine you usually need about 54 i think !! but june 11 was 58 :s

Our teacher taught us this for evaluation:

Time lag - short run/long run
Importance - for example, how significant is the NMW increase? If it's like 2p an hour then it's very unlikely to cause problems
Magnitude - how big or small the effect will be
Elasticity - maybe the elasticity changes the effect
Depends - using the word depends helps evaluate eg. it depends on the time lag
However - this is an evaluative term that is useful so you remember to look at the other side of the argument

TIMED-H

Hope that helps!

Economic effects on falling house prices on first time buyers??

If you have a look at couple page front, you should see some on evaluation
WEESTEPS or MAGICSTEPS

Both useful

Economic effects on falling house prices on first time buyers??

That just made my head spin.

Well economically, it would increase the demand for housing due to a lower price for it ( use a supply and demand diagram to explain - could get up to 4 marks for it).

Evaluate by mentioning that the fall in house prices may be quite small and therefore might not affect the demand that greatly.

Anyone else care to expand?

do we need to knw nominal and real??i t came up in a paper!

There's some weighing up to be done IMO: on the one hand, falling house prices mean that in theory first time buyers should be able to obtain mortgages and put down the house deposit more easily. However, looking at the wider context, the falling house prices are probably part of some greater issue - a recession perhaps. If this was the case, any potential positives for first time buyers might be negated by the reluctance/cautiousness of banks in giving out mortgages for fear of them not being paid back. I'd also agree with you, Shaminn, that the magnitude of the fall in prices is highly significant.

also there would be a negative wealth effect on those that already own homes

also there would be a negative wealth effect on those that already own homes

Could you or someone actually define wealth effect for me?

Didn't the question specifically ask about the effect on first time buyers?

o srry, i just went onto the last page and saw you make your point and thought you'd missed out on that one, apologies

No problem. Thanks for mentioning the wealth effect, I'd forgotten about it and wouldn't mind dropping it into a few answers tomorrow!

PM ME THE OTHER resources please

Its hard to quantify what the equilibrium price is to begin with so its difficult to set a target price

Last question from me. How exactly, other than unemployment, is the National minimum wage an example of government failure??