(Original post by Mystic Creature)
Hey there guys! I'm also doing both units in may
Pointers for 25 markers
Unit 1: There are two main types of questions that come up:
"Evaluate the different policies that the government can use to *insert action here* -" Firstly, define any key words you need to, set the scene, talk about market failure. Then, talk about all of the RELEVANT different policies. This could include subsidies, taxes, min prices, max prices, buffer stocks, regulation etc. Don't take too long on this as this is still just ANALYSIS. To get the top marks, you must EVALUATE, and that should be ongoing. So, once you explain a policy, discuss how effective it would be in leading to a better allocation of resources. So why may subsidies not be effective? - well, if the supply was very inelastic. Why may buffer stocks not be a good idea? - well, because buffer stock agencies may dry up after a few years etc. For a max price ceiling - the emergence of black markets. At the end, come to a well-rounded judgement. Make sure you are drawing graphs all of the time, and explaining.
The other type could be a simple "Market forces vs government intervention" essay. So, intro - set the scene, define key terms, recognise the type of good it is (merit, public, demerit etc). Then:
Market forces - for: signalling, incentive and rationing functions of price can lead to an efficient allocation of resources. Market forces may lead to productive efficiency (remember to define terms). Government intervention could lead to govt failure (and expand on that). With government intervention, there is an opportunity cost.
Govt intervention - for: Use graphs to show how subsidies/taxes could be used to correct market failure - MSC/MSB. Market forces doesnt take into account ext costs and benefits, and so can lead to market failure. Talk about different govt policies (as above).
Then, come to a conclusion saying which you think is more effective - there is no right answer, but just make sure you have reasons to back up your choice. So, for example, market forces are more effective, as govt intervention can lead to govt failure and an even further misallocation of resources.
And sorry, I havent really started revising unit 2, so I wouldnt be of much help there
Oh, and one question: in microeconomics, is it necessary to talk about the price adjustment process?