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# Edexcel AS Economics (New Spec) Unit 2 - 23rd May 2016 Watch

1. (Original post by Beccatenney)
what calculations are we going to need to be able to do/ what might they ask?
Index numbers, Real GDP value, converting nominal GDP to Real GDP, converting them from numbers to percentage changes… nothing too hard
2. (Original post by AsmaaMahamud97)
You're aware that the mark scheme only contains indicative content for the longer mark questions, right?
So I'm pretty sure it would be rewarded, especially since it's related to PED, which would be in the mark scheme.
But thanks anyway.
I'm sure it would too. But don't post it in an AS forum, when most people wouldn't have a need or be able to help you.
3. Anyone got examples of multiplier questions at all? Like made up thanks!
4. (Original post by EmmaWoodley)
Anyone got examples of multiplier questions at all? Like made up thanks!
YEah, I posted some a few pages back. Here are some more

(questions on the left, answers on right)

http://hleavey.site/multiplier
5. (Original post by zayn008)
Index numbers, Real GDP value, converting nominal GDP to Real GDP, converting them from numbers to percentage changes… nothing too hard
Multiplier - Almost definitely will come up as it is new to the specification
6. (Original post by AsmaaMahamud97)
I think I had the same problem, but the past papers helped a lot with the XED question. It's about finding a good balance.

Is it about benign deflation and how deflation is pretty harmless compared to inflation?
Not very much on deflation, (btw what is benign deflation??)

But it's more on oil prices, commodity prices and relative productivity.

Some of the questions include:

Explaining the productivity gap

Calculating percentage change in oil prices

Impact on income distribution when food, oil and gas prices rise

Impact on UK's real output and price level of the trend in oil prices, using an AD/AS diagram

Factors that the Monetary Policy Committee take into account when setting Interest Rates (other than oil and food prices)

And for the 20 marker:

Evaluate the likely effect of the change in productivity on the level of AS and the price level in a country such as the UK

OR

Evaluate the benefits and costs of growth for a country such as the UK

I'm hoping they're right once again, because in the Unit 1 book, they spoke about the Help to Buy scheme, and even their 20 markers had government intervention in the housing market.
7. (Original post by harryleavey)
Lets say interest rates fail to stimulate AD.

1. The central Bank buys financial assets (such as government bonds)
2. They do this by 'Printing money' - they just create more money electronically and use this new money to buy the assets.
3. As a result the owners of these financial assets have more cash
4. These owners are financial institutions, commercial banks...
5. If they have more money, they are more willing to lend. So consumers can more easily gain access to credit. Therefore consumption increases and AD increases.
6. As a result of the Bank of England purchasing these financial assets. The demand for the assets increases. This causes the price to rise. Therefore the yield on these assets falls. This creates an incentive for the sellers of these assets to purchase other assets, such as government bonds or company shares.
OHHHH i get it now thank u !
8. (Original post by officialjaayjaay)
OHHHH i get it now thank u !
If point 6 confuses you, just ignore it. The first 5 are sufficient
9. (Original post by zayn008)
Index numbers, Real GDP value, converting nominal GDP to Real GDP, converting them from numbers to percentage changes… nothing too hard
Do you think we'd be asked to calculate inflation? For example, we're given a basket of goods, their weights and indexes and asked to calculate it?
10. (Original post by amelienine)

Explaining the productivity gap
Do you mean output gaps?
Productivity gaps are not in the spec.

They are both very different concepts
11. (Original post by amelienine)
Do you think we'd be asked to calculate inflation? For example, we're given a basket of goods, their weights and indexes and asked to calculate it?
I hope not
12. (Original post by Beccatenney)
why does supply side policies cause growth without inflation?
increases productivity as oppose to consumption investment gs and current account
13. (Original post by harryleavey)
If point 6 confuses you, just ignore it. The first 5 are sufficient
no it's okay it completes the chain of reasoning
14. Can someone explain what the negative multiplier effect is and how it is started?
15. (Original post by amelienine)
Do you think we'd be asked to calculate inflation? For example, we're given a basket of goods, their weights and indexes and asked to calculate it?
We could… I've never come across that which makes it more likely lol but yes, it's also good to be aware that they might chuck in spending on housing for something like "total household spending but pays this much rent..." but they might ask for CPI in which case you need to minus the rent and just work out the percentage change in the prices
16. (Original post by harryleavey)
Do you mean output gaps?
Productivity gaps are not in the spec.

They are both very different concepts
It's from a reference book which is based on the new spec, but if it's not on the spec, then it's not on the spec...
17. (Original post by amelienine)
It's from a reference book which is based on the new spec, but if it's not on the spec, then it's not on the spec...
Yeah I see it is in some of the books.
It definitely isn't on the spec.

It is just the difference in productivity between countries
18. (Original post by amelienine)
Not very much on deflation, (btw what is benign deflation??)

But it's more on oil prices, commodity prices and relative productivity.

Some of the questions include:

Explaining the productivity gap

Calculating percentage change in oil prices

Impact on income distribution when food, oil and gas prices rise

Impact on UK's real output and price level of the trend in oil prices, using an AD/AS diagram

Factors that the Monetary Policy Committee take into account when setting Interest Rates (other than oil and food prices)

And for the 20 marker:

Evaluate the likely effect of the change in productivity on the level of AS and the price level in a country such as the UK

OR

Evaluate the benefits and costs of growth for a country such as the UK

I'm hoping they're right once again, because in the Unit 1 book, they spoke about the Help to Buy scheme, and even their 20 markers had government intervention in the housing market.
Benign deflation occurs when, for example, oil prices drop and make production cheaper- usually goes hand-in hand with economic growth. It's not significantly damaging is all you really need to know.
I might need to consider these questions in that case!
19. (Original post by amelienine)
If I just sat down and read/memorised everything in the Hodder education reference book, would that be better than doing past year papers? I think my mistake with paper 1 was that I relied too heavily on past year papers. The question on price mechanism shocked me a bit but I looked back and it was in the reference book.

For Unit 1, the practice paper they had at the back of the book was very similar to what actually came out (housing market), so my friend who studied that was able to do very well on the paper.

In the Unit 2 book, there's a lot on oil prices.
To be totally honest, it doesn;t really matter what you do.
Just do something.

If it isn't in your long term memory now, you are unlikely to be able to explain it well tomorrow anyway.
20. (Original post by harryleavey)
To be totally honest, it doesn;t really matter what you do.
Just do something.

If it isn't in your long term memory now, you are unlikely to be able to explain it well tomorrow anyway.
Exactly what i did as well as for paper 1 - did every paper topics that came upe were fairly obscure.

Now memorised the hodder book as that has everything needed.

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