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    Really? We will just have to be really strict with time then... Just remember both parts are of equal weighting!
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    Does any one else seem to be getting perfectly good answers but sometimes arent in the mark schemes but are in the revision guides?
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    (Original post by Yasmin2K8)
    Does any one else seem to be getting perfectly good answers but sometimes arent in the mark schemes but are in the revision guides?

    yea, the mark schemes are just guides on points that could come up.
    as long as the pointsare relevant,and have good merit,then you'll be fine
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    my teacher suggested to do the data respone first the the essays as its easier to pick up marks on the eassys
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    I like doing the essays first - get some marks in the bag before wading into the harsh waters of data-response.

    Anyway, for the exemplar paper that edexcel has on their site - http://www.edexcel.org.uk/VirtualCon...plar_Paper.pdf

    there's no mark scheme, so how about we make our own? I'm going to be going through the question 1 of section A after lunch, so I'll post the answers to that up on here when I've done that, and you guys can add your own answers to other questions?
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    hello to all. i got a chem exam in an hr so dont want to fill my head with econ stuff.
    althou i understand how a Balance of payment deficit signifies deceasing competitiveness of UK goods, i dont really grasp the idea.

    i will come back and post my answer to such a question, but was wwondering if any1 could post up a model answer to HOW BoP DEFICIT SHOWS DETERIORATING UK COMPETITIVENESS

    thanks
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    (Original post by ayandutta)
    but was wwondering if any1 could post up a model answer to HOW BoP DEFICIT SHOWS DETERIORATING UK COMPETITIVENESS
    A BoP deficit on the current account occurs when the value of imports exceeds the value of exports. This shows that foreigners are not demanding our imports due to low competitiveness. This could be price competitiveness (high exchange rate, inflation) or non price competitiveness (quality).
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    answering the question without any revision:

    1) (a)

    - more exports to europe = higher demand for uk goods = demand for currency = higher value of £ (evaluation = J curve?)
    - more hot money flows into uk from europe because of high interest rates in uk = higher demand for uk currency = higher value of £ (evaluation = if europe is in recession they might not be able to save money in uk?)
    - lower inflation in the uk causing general price levels to fall = higher demand for uk goods = demand for currency = higher value of £ (evaluation = if goods are inelastic then demand doesnt change much?)

    (b)

    - fall in pound against euro = more demand for uk goods = reduce BOP deficit / increase AD / growth / inflation (evaluation = depends on significance / automatic stabiliser?)

    im not really that confident in my answers, please let me know if im way off
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    (Original post by chidona)
    I like doing the essays first - get some marks in the bag before wading into the harsh waters of data-response.

    Anyway, for the exemplar paper that edexcel has on their site - http://www.edexcel.org.uk/VirtualCon...plar_Paper.pdf

    there's no mark scheme, so how about we make our own? I'm going to be going through the question 1 of section A after lunch, so I'll post the answers to that up on here when I've done that, and you guys can add your own answers to other questions?

    That would be very helpful! - i was just looking at this paper and am particularly stuck on ;
    Examine the factors which might explain why ‘strongly rising domestic demand hasrun ahead of overall economic growth’
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    In reply to ayandutta.

    Well, the first point is to suggest that the main cause of the deficit is via the current account - more specifically, the balance of trade in goods and services.

    Then consider the growing deficit in trade of goods. Why is this? Well, the most evident reason is a loss of UK competitiveness in the manafacture of goods. Due to increased globalisation in recent years, comparative advantage in manafacture has shifted to Eastern Europe and Asia, where labour is cheap and flexible and resources are cheap. The UK is unable to compete - the labour market is not as flexible, wages are much higher, and productivity is much lower.

    However, as an evaluation, you could point out that the deficit in the trade of goods is also partly due to strong consumer demand within the UK, which domestic firms cannot supply. This can't last forever - as the economic cycle starts to decline, then the demand pressure will ease and the deficit will ease too. Therefore, the deficit in the balance of trade is not entirely due to lack of competitiveness.

    I've got more to write, but I'm not entirely conviced by the question. It's more like a 6 -mark data response question than an essay question - furthermore, it doesn't specify a sector, so I just assumed it was in goods.
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    Hi guys,
    i am stuck on trade blocs i.e trade creatin and the other one? i dont understand them? help
    and also i need help public sector borrowing following a deficit?
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    Trade creation is when trade is (funnily enough) 'created' or encouraged between two specific nations. Trade Diversion is when trade is discouraged between two nations who previously supplied one another.

    Trading blocs encourage trade creation between member states due to no internal tariffs, so nations that used to not trade are now more inclined to. They also have the effect of trade diversion due to the 'common external tariff' - a tariff they impose on any goods coming from outside the bloc, so previous trading partners may decide to stop trade.
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    is anyone else really scared. i'm ****ting myself. i feel like i don't know anything!

    anyone have any idea where i can find data responses with markschemes?
    any idea about what will come up?

    good luck everyone
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    does anyone have a mark scheme for june 07 paper???
    please let me know!!!
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    (Original post by sass.ss)
    Examine the factors which might explain why ‘strongly rising domestic demand hasrun ahead of overall economic growth’
    It basically means why has demand been greate than supply?
    Demand - High house prices so the wealth effect takes place and consumption increases. Low unemployment leading to an increase in consumption.
    Supply - Unproductive workforce. Low levels of investment in capital equipment.
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    Can someone tell me why rise in oil price would decrease AD?
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    (Original post by Wish)
    Can someone tell me why rise in oil price would decrease AD?
    Production costs will rise so the cost of goods and services will rise. Provided they are elastic, demand will fall so AD will fall.

    Also, the UK is a net importer of oil so the (x-m) part of AD will get smaller so AD will fall.
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    good luck everyone

    as long as international competitiveness comes up i will be fine

    was looking through the past data responses and past essays i have done and would love a data response on the falling dollar - its effects - measures to stop it falling, etc
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    (Original post by hmjessop)
    Production costs will rise so the cost of goods and services will rise. Provided they are elastic, demand will fall so AD will fall.

    Also, the UK is a net importer of oil so the (x-m) part of AD will get smaller so AD will fall.
    But... AD isn't about demand so why would that be influenced? Will consumption fall due to demand falling?
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    (Original post by Wish)
    But... AD isn't about demand so why would that be influenced? Will consumption fall due to demand falling?
    What?? Aggregate DEMAND is not about demand? It is defined as the total demand for goods and services in an economy over a given time period.
 
 
 

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