[cat_cat]

(Original post by 94george94)
PM me your email address.

Could you send it to me too please? I would be really really greatful

[Lalaa]

(Original post by Placebo101)
Where natural capital (oil, coal, rare earths in this case) is in inadequete supply to meet the demands for them.

thankss !

[Placebo101]

(Original post by sarahharris)
With reference to the case study....

Should there be an increase in QE?

Answer: http://anastasiaeaster.blogspot.co.u...5/more-qe.html

Can we export our way out of the recession?

Answer: http://anastasiaeaster.blogspot.co.u...recession.html

Should we be worried about inflation?

Answer: http://anastasiaeaster.blogspot.co.u...tion-rate.html

Who loses under QE?

Answer:

http://anastasiaeaster.blogspot.co.u...who-loses.html

Evaluate the various government monetary tools available to reduce inflation.

Answer:

http://anastasiaeaster.blogspot.co.u...icy-tools.html

What happened in Japan re inflation and is deflation bad?

Answer:

http://anastasiaeaster.blogspot.co.u...deflation.html

Outline the transmissions mechanism

Answer:

http://anastasiaeaster.blogspot.co.u...mechanism.html

Wow that will be really useful, thanks! I think though that somebody here said that you don't need to know any background about the extracts other than what's in the extracts themselves.

[sarahharris]

But you do need to know context and also these add further expansion on what is in the text - as indeed do the APT/Classroom resources/ZigZag/Tutor2u analyses do...

[94george94]

(Original post by Groat)
Have you got the OCR textbook? P230.

Credibility: a credible fiscal policy framework is one where the government's commitment to economic stability is trusted by the public, business and financial markets.

Have a look at the Stability and Growth Pact (SGP), also.

That's not in my edition of the textbook, when was yours published?

Thank you anyway!

[94george94]

(Original post by cat_cat)
Could you send it to me too please? I would be really really greatful

Am I meant to guess your email address? LOL

[wwelol]

(Original post by Placebo101)
Huh. How would you recommend revising for this unit then?

green text book

[cat_cat]

(Original post by 94george94)
Am I meant to guess your email address? LOL

Lool I will PM it now thanks

[nickolijak]

anyone got any videos which explain Trade & Integration (need to know for extract 2) :s

[cakeonmymind]

can someone please send me the apt booklet? im so worried i dont know how to revise for this

[94george94]

Analyse how inflation will help to balance the Chinese economy. (6)

If Chinese inflation was to rise relatively faster than its trading partners, China would expect to see the real value of the Yuan increase. An appreciation in the real-exchange rate will typically lead to a decrease in exports, as domestically produced goods appear less internationally price-competitive, and an increase in imports, as foreign goods and services appear cheaper to domestic consumers; this serves to decrease China’s reliance on external demand, allowing them to focus on the domestic economy. The Chinese government, therefore, will be free to concentrate on its fiscal policy, allowing them to impose policies that increase domestic consumption, such as a decrease income taxation, or government expenditure on social security. Furthermore, the aging of China’s 1.3 billion people, and the dwindling of its pool of young, cheap labour, naturally means domestic consumption will increase, and China’s inflation will only support said increase.

Roughly how many marks do you think I'd get for this answer, and how might I improve it?

[94george94]

(Original post by cakeonmymind)
can someone please send me the apt booklet? im so worried i dont know how to revise for this

PM me.

[Shana133]

Does anyone know how you would answer this question.

Discuss the extent to which rapid economic growth is consistent with sustainable economic development

Seriously worried about this unit - not prepared enough.

[sarahharris]

Note: when i write 'answer' I mean that the material linked to will help you write your answer - I do NOT mean that the answer is there all written out for you!

ALL with reference to the case study:

Examine the reasoning behind China's export quotas.

Answer: http://anastasiaeaster.blogspot.co.u...rt-quotas.html

Examine the cause(s) of China's current account surplus

Answer: http://anastasiaeaster.blogspot.co.u...f-surplus.html

The prices of China's exports are rising. Does this mean China is losing its competitive advantage?

Answer: http://anastasiaeaster.blogspot.co.u...imbalance.html

Evaluate whether the yuan is overvalued.

Answer: http://anastasiaeaster.blogspot.co.u...vervalued.html

"Some Western officials and scholars often play up the concept of "purchasing power parity (PPP)." They have argued that $1 should be equivalent to about 3 Yuan by PPP. The reason why they came to this conclusion is that they do not have a correct understanding of the relationship between PPP and exchange rates." Discuss

Answer: http://anastasiaeaster.blogspot.co.uk/2012/05/ppp.html

Evaluate whether China should alter its growth policy

Answer: http://anastasiaeaster.blogspot.co.u...th-policy.html

http://anastasiaeaster.blogspot.co.u...nd-growth.html

Why is China's productivity so high?

Answer: http://anastasiaeaster.blogspot.co.u...ductivity.html

Examine the reasons and significance for/of the high savings ratio in China

Answer: http://anastasiaeaster.blogspot.co.u...d-savings.html

[sarahharris]

(Original post by chunkyjooj)
Neither, the UK inflation target is symmetric. There's no such thing as a symmetrical or asymmetrical interest rate. The BoE target inflation rate is 2%, with both over and under given equal concern.

Fluctuations in interest rates do not have a uniform impact on the economy. Some industries are more affected by interest rate changes than others for example exporters and industries connected to the housing market. And, some regions of the British economy are also more sensitive to a change in the direction of interest rates.

The markets that are most affected by changes in interest rates are those where demand is interest elastic in other words, demand responds elastically to a change in interest rates or indirectly through changes in the exchange rate.
Good examples of interest-sensitive industries include those directly linked to demand conditions in the housing market¸ exporters of manufactured goods, the construction industry and leisure services. In contrast, the demand for basic foods and utilities is less affected by short-term fluctuations in interest rates and is affected more by changes in commodity prices

Therefore there IS Monetary Policy Asymmetry

[wwelol]

(Original post by 94george94)
Analyse how inflation will help to balance the Chinese economy. (6)



Roughly how many marks do you think I'd get for this answer, and how might I improve it?

first sentence is wrong
inflation weakens the currency

[chunkyjooj]

(Original post by sarahharris)
Fluctuations in interest rates do not have a uniform impact on the economy. Some industries are more affected by interest rate changes than others for example exporters and industries connected to the housing market. And, some regions of the British economy are also more sensitive to a change in the direction of interest rates.

The markets that are most affected by changes in interest rates are those where demand is interest elastic in other words, demand responds elastically to a change in interest rates or indirectly through changes in the exchange rate.
Good examples of interest-sensitive industries include those directly linked to demand conditions in the housing market¸ exporters of manufactured goods, the construction industry and leisure services. In contrast, the demand for basic foods and utilities is less affected by short-term fluctuations in interest rates and is affected more by changes in commodity prices

Therefore there IS Monetary Policy Asymmetry

Your argument is based on the impact of interest rates and monetary policy. The previous poster asked whether or not the UK sets a target symmetrical or asymmetrical interest rate. There is no official policy setting a symmetrical or asymmetrical interest rate. The UK inflation target is symmetrical, that was the answer.

[chunkyjooj]

(Original post by wwelol)
first sentence is wrong
inflation weakens the currency

Common mistake to assume inflation is ONLY bad. Inflation makes exports more expensive and therefore causes China to be less reliant on their export market, turning domestically to develop consumption. Also, it slows down manufacturing in a way and allows China to focus on more sustainable growth. At a stretch as it makes Chinese goods more expensive, it will increase demand for imports, impacting China's significant current account surplus.

[sarahharris]

(Original post by 94george94)
Analyse how inflation will help to balance the Chinese economy. (6)



Roughly how many marks do you think I'd get for this answer, and how might I improve it?

The 'real value' will fall BUT the price of the good rises therefore from the point of view of the buyer (importer) it is as if the real value had risen.

Check this:

http://anastasiaeaster.blogspot.co.u...eal+value+Yuan

[sarahharris]

(Original post by chunkyjooj)
Common mistake to assume inflation is ONLY bad. Inflation makes exports more expensive and therefore causes China to be less reliant on their export market, turning domestically to develop consumption. Also, it slows down manufacturing in a way and allows China to focus on more sustainable growth. At a stretch as it makes Chinese goods more expensive, it will increase demand for imports, impacting China's significant current account surplus.

On the subject of the current account surplus....


Based on purchasing power parity (PPP), the Yuan has appreciated by almost 50% against the dollar since 2005 which would suggest that the perceived undervaluation of the Yuan is not the root cause of China’s large current account surplus. Continued low levels of consumption and high savings have distorted economic growth in China.”

So the obvious answer is to return to what is ON the current account and then we can see what may have caused the surplus…..

1. Export-oriented growth: China is now the world’s biggest manufacturing exporter. (Diagram)
2. Foreign direct investment: There has been a huge amount of inward investment into China (Factors affecting)
3. Undervalued exchange rate: (What factors affect the exchange rate?)
4. High domestic savings rates
5. Closed economy – some countries have a low share of national income taken up by imports – perhaps because of tariff and non-tariff barriers – different forms of protectionism
6. Strong investment income from overseas investments

Having discussed the above, we return to the alleged ‘undervaluation’.

The undervaluation is the result of the adoption by China of a fixed exchange rate and its refusal to allow the yuan to appreciate.

This means that the Chinese currency does not float freely – if it floated freely then the currency would appreciate in value. Remember, exports increase foreign demand for a country’s currency, and imports increase the supply of its currency. Therefore, a balance of payment’s surplus increases demand for the country’s currency (and reduces supply), and this pushes up the exchange rate. This, in turn, will increase the price of Chinese goods in overseas markets, thus contracting demand overseas.

At the same time, it reduces the price in China of foreign produced goods thus expanding Chinese demand for these goods. These comments on the link between changing price and volumes of exports and imports assume that demand is elastic.

So if there is a LOW exchange rate/undervalued exchange rate who gains/loses?