OCR A2 Economics - F585 Global Economy - Case Study Thread
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Original post by physicshelp123
Both sound like decent points 
also could mention the inflation drop of 12%~0.2% which would hugely increase intention competitiveness which will raise we ports hence raising growth, as mentioned in the bit bellow the inflation graph
also could mention the inflation drop of 12%~0.2% which would hugely increase intention competitiveness which will raise we ports hence raising growth, as mentioned in the bit bellow the inflation graph Ah, good point yeah, ill add that to my notes.
Anyone any idea's on: 'Assess the view that running a balanced budget and low government debt will help Estonia to sustain her growth and development in the long run'?
I think this is a pretty important one as the last two extracts are really focused of Sustainable development. Can't think of anything at the moment
Original post by physicso
Ah, good point yeah, ill add that to my notes.
Anyone any idea's on: 'Assess the view that running a balanced budget and low government debt will help Estonia to sustain her growth and development in the long run'?
I think this is a pretty important one as the last two extracts are really focused of Sustainable development. Can't think of anything at the moment
Anyone any idea's on: 'Assess the view that running a balanced budget and low government debt will help Estonia to sustain her growth and development in the long run'?
I think this is a pretty important one as the last two extracts are really focused of Sustainable development. Can't think of anything at the moment
I've got that
A) they have no constraint on how much they can spen on development strategies as they have no debt. E.g. They can spend load in welfare payments/ health to improve productivity and lower income inequality meaning higher sustainability
B) as they don't owe any one money/ no debt, they don't have to raise future tax's to pay this meaning they can grow more in the future (due to no brain drain) so GDP per head should raise increasing development in the future
not to sure about policies to raise sustainable developent tho all I have is environmental taxation and progressive taxation/ minimum wage what are some good policoes they could use?
Original post by physicshelp123
I've got that
A) they have no constraint on how much they can spen on development strategies as they have no debt. E.g. They can spend load in welfare payments/ health to improve productivity and lower income inequality meaning higher sustainability
B) as they don't owe any one money/ no debt, they don't have to raise future tax's to pay this meaning they can grow more in the future (due to no brain drain) so GDP per head should raise increasing development in the future
not to sure about policies to raise sustainable developent tho all I have is environmental taxation and progressive taxation/ minimum wage what are some good policoes they could use?
A) they have no constraint on how much they can spen on development strategies as they have no debt. E.g. They can spend load in welfare payments/ health to improve productivity and lower income inequality meaning higher sustainability
B) as they don't owe any one money/ no debt, they don't have to raise future tax's to pay this meaning they can grow more in the future (due to no brain drain) so GDP per head should raise increasing development in the future
not to sure about policies to raise sustainable developent tho all I have is environmental taxation and progressive taxation/ minimum wage what are some good policoes they could use?
What kind of anaylsis points can we raise here though? because half the essay marks are for anaylsis, and i'm struggling to think what i could come back on. Perhaps Estonia cannot be sure that it will remain debt free (Economic disasters are usually very hard to predict) so there are taking a risk spending alot on welfare benefits? It openness may also limit it's sustainability as foreign MNC's are using many of Estonia's resources, limiting the amount available to future generations??
Hmmmm, for policies, you could talk about the EU common energy policy or Estonia's environmental targets (last extract in the toolkit!)
Original post by physicshelp123
it would depend on the question I guess, I've always found rewording the question in the conclusion helps answer it properly
E.g q) discuss the extent to which Estonia are reaching their goals for sustainable development, a conclusion could be .... As disgussed, Estonia are clearly behind the rest of the eu and their aim to be in the top 5 economies, but the future looks prosperous with their balanced budget, lack of debt and stong forcasted growth. To conclude, at the current time the extent to which Estonia are achieving their goals is pretty low, however their goal is for 5-10 years in the future in which there is likely to be a much higher extent to achieving these goals?!?
got me 93 ums points in work and leisure tho I'm finding this module a lot lot harder to wrap it all up :/
E.g q) discuss the extent to which Estonia are reaching their goals for sustainable development, a conclusion could be .... As disgussed, Estonia are clearly behind the rest of the eu and their aim to be in the top 5 economies, but the future looks prosperous with their balanced budget, lack of debt and stong forcasted growth. To conclude, at the current time the extent to which Estonia are achieving their goals is pretty low, however their goal is for 5-10 years in the future in which there is likely to be a much higher extent to achieving these goals?!?
got me 93 ums points in work and leisure tho I'm finding this module a lot lot harder to wrap it all up :/
thankyou very much, it seems so hard to pick up the evaluative conclusion marks!
Two questions i'm really struggling with:
1. Discuss the view that sustainable development in Estonia requires slow Economic growth.
Here - i would start of by defining sustainable development, then talking about how Estonia hasn't really experienced slow economic growth (apart from in recession) since joining the EU in 2004, then i would list the reasons why slow economic growth is beneficial to sustainability (not 100% sure why it would), come back on this by saying.. however, sustainable development can also be achieved when growth is fast if (again lacking reasons).
Finally, i would evaluate along the lines of... the extent to which sustainable development requires strong growth is dependant on level of govt debt, level of equality, etc... then conclude???? Is this enough?? can anyone recommend any points?
2. Analyze, using a diagram, how high levels of economic growth may cause environmental market failures :s
I haven't a clue with this one.
1. Discuss the view that sustainable development in Estonia requires slow Economic growth.
Here - i would start of by defining sustainable development, then talking about how Estonia hasn't really experienced slow economic growth (apart from in recession) since joining the EU in 2004, then i would list the reasons why slow economic growth is beneficial to sustainability (not 100% sure why it would), come back on this by saying.. however, sustainable development can also be achieved when growth is fast if (again lacking reasons).
Finally, i would evaluate along the lines of... the extent to which sustainable development requires strong growth is dependant on level of govt debt, level of equality, etc... then conclude???? Is this enough?? can anyone recommend any points?
2. Analyze, using a diagram, how high levels of economic growth may cause environmental market failures :s
I haven't a clue with this one.
Original post by physicso
How would you show the effects of a devaluation in a countries currency on an AD/AS diagram... would you simply show AD falling?
on an exchange rate diagram would be if people demand less of your currency (exports are decreasing) and D shifts in
the other way is if supply of your currency is increasing because people in the country are importing more, S shifts out
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yeah why would slower growth be better for sustainable development than faster growth? can only really think of all your resources wont be used up to allow time for new renewable resources to be made but cant think of anything else ?
Ok for this question. First it is vital to explain why growth is needed for development. So that money can be spent on health care, education...etc.
Then would go on to say why slow growth is needed, or why fast growth would prevent EG.
+yes that point you said is correct. Fast growth uses up resources, so future generations will not have the same resources to use and limite thier growth
+Also, if economic growth was fast, it is likely that the economy would overheat (Ad will rise faster than AS) and then result in inflation, a fall in exports (due to price competitiveness and therefore AD will fall, therefore, growth will slowdown. and therefore in future with less growth, the ability to develop will be lower, therefore sustainable development is unlikely.
+Estonia is small economy, so vunreable to fluctating growth. This reduces confidence and in turn FDI. therefore slow stable growth attracts FDI which should cause LR growth (increase in AS and AD)
-Then would talk about depends on how slow growth is, growth at 0.5% is not that good for obvious reasons.
Depends on the ability of AS to shift at same extent of AD. If As increases at same amount of AD, then fast growth is fine, as there is no inflationary pressure.
-Also depends on how much spare capacity is in economy. If there is considerable spare capacity, fast growth unlikely to be inflationary, therefore not bad.
-Also, you must not ignore the future economic environment. Slow growth may be good, but a worldwide recession will no doubt hinder development in the future.
Firstly: How would you show the effects of a devaluation of a country's currency on an ADAS diagram? Would you simply show a shift the left on AD?
A devaluation of a countries currency would be shown on an Exchange rate diagram. The effects of the devaluation would in fact be a right shift in AD, this is because exports becomes more price competitive- leading to increase in exports and right shift AD.
Assess the view that running a balanced budget and low government debt will help Estonia sustain her growth and development in the long run.
Tricky one . first define Balanced budget and GD + development.
Low Government debt allows future generation taxes to stay low, therefore enabling high disposable incomes, and high growth, therefore allow development (obviously explain why)
Budget balance suggest stability, FDI is attracted to stability countries (because an unstable country may be in a boom then a recession which would effect profits) Therefore increase FDI promotes increases in AD (multiplier) and AS (increase capital equipment) therefore long run growth is likely to be achieved. Also, budget ballance mean GS can be increased when necessary (in a recesion) therefore, LR growht more likely to be achieved.
Depends on; OTHER MACROECONOMICS VARIABLES, YOU MAY HAVE A BALANCED BUDGET BUT LOW DEBT. BUT A RECESSION WILL STILL **** YOU OVER. THIS IS A VITAL POINT. SEEN IT IN ALL THE MARCSCHEAMES.
+ depends on how low debt is.....
+ it is not a given that growth = development. may be unequal growth. therefore very little people sea increases in health and education. + may be capital led growth, no increases in jobs therefore no development.
Ok for this question. First it is vital to explain why growth is needed for development. So that money can be spent on health care, education...etc.
Then would go on to say why slow growth is needed, or why fast growth would prevent EG.
+yes that point you said is correct. Fast growth uses up resources, so future generations will not have the same resources to use and limite thier growth
+Also, if economic growth was fast, it is likely that the economy would overheat (Ad will rise faster than AS) and then result in inflation, a fall in exports (due to price competitiveness and therefore AD will fall, therefore, growth will slowdown. and therefore in future with less growth, the ability to develop will be lower, therefore sustainable development is unlikely.
+Estonia is small economy, so vunreable to fluctating growth. This reduces confidence and in turn FDI. therefore slow stable growth attracts FDI which should cause LR growth (increase in AS and AD)
-Then would talk about depends on how slow growth is, growth at 0.5% is not that good for obvious reasons.
Depends on the ability of AS to shift at same extent of AD. If As increases at same amount of AD, then fast growth is fine, as there is no inflationary pressure.
-Also depends on how much spare capacity is in economy. If there is considerable spare capacity, fast growth unlikely to be inflationary, therefore not bad.
-Also, you must not ignore the future economic environment. Slow growth may be good, but a worldwide recession will no doubt hinder development in the future.
Firstly: How would you show the effects of a devaluation of a country's currency on an ADAS diagram? Would you simply show a shift the left on AD?
A devaluation of a countries currency would be shown on an Exchange rate diagram. The effects of the devaluation would in fact be a right shift in AD, this is because exports becomes more price competitive- leading to increase in exports and right shift AD.
Assess the view that running a balanced budget and low government debt will help Estonia sustain her growth and development in the long run.
Tricky one . first define Balanced budget and GD + development.
Low Government debt allows future generation taxes to stay low, therefore enabling high disposable incomes, and high growth, therefore allow development (obviously explain why)
Budget balance suggest stability, FDI is attracted to stability countries (because an unstable country may be in a boom then a recession which would effect profits) Therefore increase FDI promotes increases in AD (multiplier) and AS (increase capital equipment) therefore long run growth is likely to be achieved. Also, budget ballance mean GS can be increased when necessary (in a recesion) therefore, LR growht more likely to be achieved.
Depends on; OTHER MACROECONOMICS VARIABLES, YOU MAY HAVE A BALANCED BUDGET BUT LOW DEBT. BUT A RECESSION WILL STILL **** YOU OVER. THIS IS A VITAL POINT. SEEN IT IN ALL THE MARCSCHEAMES.
+ depends on how low debt is.....
+ it is not a given that growth = development. may be unequal growth. therefore very little people sea increases in health and education. + may be capital led growth, no increases in jobs therefore no development.
could someone email me the whole tutor2u toolkit please? My email is [email protected] 
My email is [email protected] Original post by physicso
2. Analyze, using a diagram, how high levels of economic growth may cause environmental market failures :s
I haven't a clue with this one.
2. Analyze, using a diagram, how high levels of economic growth may cause environmental market failures :s
I haven't a clue with this one.
I think that question is just asking how high levels of economic growth causes negative externalities, so you would metion the negative externalities; using up resourses, pollution etc. Then use a negative externality diagram to show how they are not being internalised, hense market failure.
You could then comment on ways in which you could internalise the externality and correct the market failure, e.g. green taxes, encourage firms to invest in cleaner production techniques etc. However it would depend on the marks available for whether you would need to go into this.
Hope that helps
Original post by oeh
I think that question is just asking how high levels of economic growth causes negative externalities, so you would metion the negative externalities; using up resourses, pollution etc. Then use a negative externality diagram to show how they are not being internalised, hense market failure.
You could then comment on ways in which you could internalise the externality and correct the market failure, e.g. green taxes, encourage firms to invest in cleaner production techniques etc. However it would depend on the marks available for whether you would need to go into this.
Hope that helps
You could then comment on ways in which you could internalise the externality and correct the market failure, e.g. green taxes, encourage firms to invest in cleaner production techniques etc. However it would depend on the marks available for whether you would need to go into this.
Hope that helps
That really did help thanks!
I was just wondering, you know an increase in interest rates... would this increase or decrease AD?
Because on one hand, higher rates of interest would increase hot money as saving is more attractive... But on the other hand higher interest rates would increase exchange rates, making exports more expensive and decreasing demand for currency?
Original post by physicso
That really did help thanks!
I was just wondering, you know an increase in interest rates... would this increase or decrease AD?
Because on one hand, higher rates of interest would increase hot money as saving is more attractive... But on the other hand higher interest rates would increase exchange rates, making exports more expensive and decreasing demand for currency?
I was just wondering, you know an increase in interest rates... would this increase or decrease AD?
Because on one hand, higher rates of interest would increase hot money as saving is more attractive... But on the other hand higher interest rates would increase exchange rates, making exports more expensive and decreasing demand for currency?
increasing interest rates does mean saving is more attractive, therefore consumption (AD) decreases
it also means that the value of your currency goes up because currency demand shifts out as people want to put money into your banks due to the high interest rates. this also means that your currency is worth more so your exports decrease too and AD decreases
oh and imports will probably increase meaning AD decreases toohope that helps!
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I did about three practice questions and got bored, all I've done is flashcards and notes 
Guys can you help me answer this question
Explain what is meant by financial integration 4 marks
And
Analyse the benefits of prudent macroeconomic policy
Thanks!!
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Explain what is meant by financial integration 4 marks
And
Analyse the benefits of prudent macroeconomic policy
Thanks!!
Posted from TSR Mobile
Okay i think 'Financial integration' includes the deepening and connecting of financial markets between countries. The markets include, - Money markets (consumer/business) loans, Bond markets (debt issued by govts) and currency markets (form of exchange rate and foreign currency).
In Extract 2 it mentions financial integration in the form of FDI and debt flows to be more precise.
In Extract 2 it mentions financial integration in the form of FDI and debt flows to be more precise.
Original post by 95pc1
Guys can you help me answer this question
Explain what is meant by financial integration 4 marks
And
Analyse the benefits of prudent macroeconomic policy
Thanks!!
Posted from TSR Mobile
Explain what is meant by financial integration 4 marks
And
Analyse the benefits of prudent macroeconomic policy
Thanks!!
Posted from TSR Mobile
Financial integration is the debt and FDI in the economy which is from other countries. If that makes sense.
A prudent macroeconomic policy is archiving price stability and stable growth which is beneficial because it reduces risk which would avoid costs as people and firms are not being over charged. It reduced uncertainty which reduces the damage of long term economic performance like reduction in consumer and business confidence. This would avoid recessions in being more prolonged and recoveries stronger. Hence the reason why Estonia experienced a strong recovery from the global recession as well as openness to international trade and FDI inflows
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