So for the MCQ we have answers to:

The PPF question- the answer was that producing more capital goods would lead to economic growth (OPTION D)

The YED question about meats- Fish has a higher YED than meat (or meat does - the answer was OPTION D)

The buffer stock question- the government would sell from its stockpile (OPTION B)

The price mechanism question- acts as a signal for firms to make production decisions

The question about Ibiza- decrease in revenue as demand is elastic

The question about a rise in producer surplus- increase in technology will increase producer surplus (OPTION B)

The externality question- there would be a net welfare gain

The free market/ market failure question- the under provision of public goods. (OPTION A)

(edited 7 years ago)

Reply 91

emilia_claire

Original post by BBajwa

Nice. From what I have seen I have got all the letters right. Hopefullt dropped 2 marks max on the multiple choices.

I think I might be the same, feeling a lot better about the unit 1 exam than I did last year!

Reply 92

epic within

Original post by BBajwa

Nice. From what I have seen I have got all the letters right. Hopefullt dropped 2 marks max on the multiple choices.

me too, i get the correct answer but I sometimes don't expand it and end up getting 3/4

Reply 93

Jasinfinities

Got 8/8 correct in the MCQs but I wrote too much for them and ran out of time for the 6 marker in section B & only got half way through the last question.

Reply 94

epic within

now I need to start revising unit 2, I hope they ask components of AD like 2013, easy 6 marks

Reply 95

BBajwa

Original post by epic within

me too, i get the correct answer but I sometimes don't expand it and end up getting 3/4

Yh although I did try to eliminate two for each one so hoping for the best.

Reply 96

emilia_claire

Well done everyone! Unit 1 is done and we all did pretty well by the sounds of it :smile:

on to unit 2 now...

Reply 97

IJKninetyeight

If people want to know the exact mark scheme for the Buffer stock question and Vaccine Externalities question they both appeared on the Jan 2012 paper - Q7 and Q8

Buffer Stock:
---> • Understanding or explanation of buffer stock scheme(for example: agency sells from buffer stock in times of poor harvest and buys or adds to it in times of good harvest. (1 mark).Note this explanation must consider both the buying and selling function of the buffer stock to secure a mark).• Identification that in 2010 there is a bad harvest / or supply has decreased (1 mark).• Without intervention the price would rise to P3 or point Z (1 mark)• Government agency sells Q3-Q2 or XY of wheat from its stockpile to establish a price of P2 (this may be shown by annotation of the diagram) (1 mark).• Government agency revenue from the sale is Q3Q2XY(this may be shown by annotation of diagram but needs to be labelled or referred to in answer) (1mark).Rejection marks• Option A incorrect since there is a poor harvest that could lead to an excess demand for wheat (1 mark).• Option B incorrect since the agency will sell Q2Q3XY from its stockpile – not buy. (1 mark)Note: do not double award if already credited in the explanation.• Option C incorrect since price would increase to P3 ina free market or to a maximum of P2 under the bufferstock scheme. (1 mark).

Externalities:
• Definition of welfare gain (the excess of social benefit over social cost for a given quantity) (1mark).• Identification or annotation of diagram to identify welfare gain as area XZY (accept welfare loss)(1 mark).• Identification of the free market equilibrium as pointX or quantity Qe and the social optimum as point Or quantity Q1 (1 mark).• Definition of external benefits: (positive third party effects / benefits external to an exchange/ benefits the price mechanism ignores / benefits outside the market transaction / difference between social benefits and private benefits / positive spillover effects) (1 mark).• Application to vaccinations: welfare gain or external benefits include a reduction in the spread of diseases since more people vaccinated. (1 mark).Rejection marks• Option A incorrect since the social optimum quantity's Q1 or Y which is greater than the free marketquantity Qe or X. (1 mark)Note: do not double award if already credited in the explanation• Option B incorrect since welfare gain is area XZYNote: do not double award if this area has already been credited in the explanation) (1 mark).• Option D incorrect since marginal social cost (X or Pe) is less than marginal social benefit (Z ) (must state the letters) (1 mark).

Some dates may be wrong because its in context of 2012.