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# AQA A2 Economics Unit 4 (ECON4) June 23rd OFFICIAL THREAD Watch

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1. (Original post by Anymorefor123)
sick, same ideas phew... so many people didnt even mention the phillips curve thought id done something wrong... lmao
Yeah if it's the case "for this side or against this side", policy discussion isn't needed in too much depth; its rather a general overview of which side is better, throwing in a few things from clues in the extracts e.g. structural unemployment
2. (Original post by kimmm123)
I think the mark scheme will vary because diferent people's interpreatation of what the exact numbers were, I got 2.73 so I think it will be lenient, something like accept 2-3%
There will be a slight variation but the other guy did the whole time period by accident
3. (Original post by Crozzer24)
I spoke about laffer curve and how that an increase in income tax may lead to lower tax revenues therefore increase deficit, spoke about gov spending on welfare during a time of unemployment etc. Drew Ad and laffer curve diagram do you think that will be 15 marks?
Oh yeah, I did the Laffer Curve! Also an inflation one so you did the same as me. Hopefully that'll be enough. I type in my exams so my graphs were on a separate sheet and I referenced them in various questions, some multiple times as well, but I forget now.
4. (Original post by High Stakes)
That is mathematically the same thing? I don't know why we're different in our answer then other than the rounding up.
I got 27.756 or something then like a tard rounded it up to 30k lol. But I did write in the original 27. something before stating 'the real gdp per capita of spain in 2014 was 30k' hopefully they'll take the previous 27. something into consideration first?

I'm a bit brain dead after teh exam; what number did you get exactly?
5. (Original post by Anymorefor123)
cool and then for the main essay i basically ( sorry my explnation is going to be long) but i started off with a little intro and talked about the phillipis curve argument.

how despite demand side policies used to increase growth.. reduce unemployment e.ct. is good to reduce cyclical unemployment, boost growth e.ct. its useful up to a certain degree

monetarists argue there will still be higher inflation/ same level of unemployment in the long run = nairu, that demand side policies arent good at solving

brought in supply side policies .. qouted the data a fair bit " the mismatch of skills".. suggesting possible structural/ frictional unemployment problems and how supply side polcies e.g. training could help bring those down

along side increasing further employment as those people spend more
making exports more globally competative as our LRAS shifts= more AD= more employment e.ct. e.c.t

and basically ended with the fact that both policies in moderation need to be implemented, to not only increase AD, make sure growth is sustainable ( no positive/ negative output gaps) , and reduce the rate of unemployment in the long run..

evaluated the policies mentioned too of course,
Nice, well done!

For the essay I had to add in the extract stuff as an after thought, but I did explain it individually and quite in depth too. It's because I started writing a crap ton and I didn't address much of the stuff in the context.

Defined government intervention

Defined supply side policies

Pro of supply side policies: more affordable educaiton/qualifications: more people going for themr: more people skilled: labor more attractive; drew demand and supply graph about a shift to the right in the demand for labor: cuz higher productivity = lower average costs for businesses = higher profit margins: more employment.

Con of supply side: Drew a kinked trend rate of growth from a point where the economy was in recovery (past a trought) and proceeded to explain how increasing industrial capacity and productivity means widening the demand deficiency in the economy. Not all factosr of production would be used. This includes labor. Thus less employment as labor would be so productive there would be need for fewer people. Or if supply side policy was about technology, then more factor of production substitution, more capital being used instead of human labor, more unemployment.

Pro of demand side: drew trend rate of growth, labelled point 0 as where the UK could be, point 1 where trend meets current, point 2 where current exceeds trend. Said that if the UK is at 0, demand side is great because demand deficiency needs more AD in the economy to have employment pick up again. Explained some stuff about that, etc. Gave example of fiscal demand policy of lowering income taxes of the lower brackets because of their higher propensity to consume.

Con of Demand side: might increase AD over trend rate of growth, drew another trend rate of growth, talked about hyperinflation and inflation as gov doesn't have perfect infomration so might increase AD by too much if the Uk was experiencing industrial capacity slack. If the UK was not suffering from demand deficiency, then it would indeed be terrible to have demand side policies. Consumer confidence and business confidences collapses from very high inflation, then everyone gets fired.

Evaluation: a crap ton, but I also mentioned that supply side is the best side (WC reference) as can achieve increases in AD from gov investment in it, helping AD deficiency, and improving trend rate of growth, putting downward pressure on prices, also achieving the inflation macroecon objective of gov. Did some scaremongering about hyperinflation and inflation and how if gov did not have proper information available, demand side policies will cause AD to jump over trend growth, kill business and consumer confidence, collapse the economy, make everyone unemployed needing to canibalize each other to survive. Also said supply side may fail as govs don't have perf information.

wrote a lot more than that but meh, can't remember
6. (Original post by Caius Filimon)
I got 27.756 or something then like a tard rounded it up to 30k lol. But I did write in the original 27. something before stating 'the real gdp per capita of spain in 2014 was 30k' hopefully they'll take the previous 27. something into consideration first?

I'm a bit brain dead after teh exam; what number did you get exactly?
I did all the conversions before rounding: got 22752.68817 which I rounded to 22753

Doesn't matter tho it's only worth 1-2 marks. The rest come from the point of comparison which is easy.
7. (Original post by Bigboss27)
People that did context 2 for the upturn question did u say an increase in growth of euro economies cause demand for exports in spain to rise so export led growth causes reduced unemployment?
Yeah, something like that!
8. (Original post by High Stakes)
I did all the conversions before rounding: got 22752.68817 which I rounded to 22753

Doesn't matter tho it's only worth 1-2 marks. The rest come from the point of comparison which is easy.
True but 1-2 is huge

Surely they'll just consider my first 227 thing first? They'll just think I misread the question? Well at least 1 mark for the calculation
9. (Original post by redwhiteandbrit)
It's alright I think I did the same tbh. We shall see. Provided the economic argument is sound and that you make it up in other areas it isn't normally an issue ... (I don't think so at least)
Thanks! Most of ECON4 overlap with ECON2 anyways so we should get most of the marks, fingers crossed.
10. for the EU q i did thisGood= trade creation--> higher AD, blah blah blah all the usual growth arguments higher GDP per captia and better standards of living however --> net importers, increases competitiveness between eu member states a lot of which are more allocatively efficient and therefore we import their goods anyway--> leakage from the circular flow e.c.t but still we experience higher growth due to the market opening up to over 500 million consumers--> higher profit for uk firms --> dynamic efficiency improvements, encourages them to become more comparative/ improve statuc efficiecny--> consumers get lower prices e.c.t Migration--> good high skilled labour e.g. 53,000 EU migrants in our NHS--> working for a public merit good thats under provided in the free market, filling job spaces where UK workers lack specific skills - however migration= burden on public services, a lot of these migrants send their income back home= leakage from the circular flow of income, wasteful spending e.g. 350 million to brussels every year - though we get a lot of this back through the rebate anyway- opportunity cost incurred--> could be going into our own economy via public expenditure- we have little say over eu laws/regulations e.g. subsiding of the farmers through CAP that encourages inffieicny in that market and only benefits 1% of the UK labor force however EU= stability to both investors and businesses e.g. 540 billion pounds of investment alone last year - london is a big finance hub and our finance exports help keep our BOP payments some what level... so we need stability -FDI= good, injection into our cirular flow of income, helps our economy in the long run- leaving the EU could be bad as weve recently seen fears of the UK leaving has led to a fall in the value of the pounds= higher prices for consumers, and of course cost push inflation affecting both individuals and firmshad a few other arguments cant remember them all... ;
11. (Original post by Anymorefor123)
for the EU q i did thisGood= trade creation--> higher AD, blah blah blah all the usual growth arguments higher GDP per captia and better standards of living however --> net importers, increases competitiveness between eu member states a lot of which are more allocatively efficient and therefore we import their goods anyway--> leakage from the circular flow e.c.t but still we experience higher growth due to the market opening up to over 500 million consumers--> higher profit for uk firms --> dynamic efficiency improvements, encourages them to become more comparative/ improve statuc efficiecny--> consumers get lower prices e.c.t Migration--> good high skilled labour e.g. 53,000 EU migrants in our NHS--> working for a public merit good thats under provided in the free market, filling job spaces where UK workers lack specific skills - however migration= burden on public services, a lot of these migrants send their income back home= leakage from the circular flow of income, wasteful spending e.g. 350 million to brussels every year - though we get a lot of this back through the rebate anyway- opportunity cost incurred--> could be going into our own economy via public expenditure- we have little say over eu laws/regulations e.g. subsiding of the farmers through CAP that encourages inffieicny in that market and only benefits 1% of the UK labor force however EU= stability to both investors and businesses e.g. 540 billion pounds of investment alone last year - london is a big finance hub and our finance exports help keep our BOP payments some what level... so we need stability -FDI= good, injection into our cirular flow of income, helps our economy in the long run- leaving the EU could be bad as weve recently seen fears of the UK leaving has led to a fall in the value of the pounds= higher prices for consumers, and of course cost push inflation affecting both individuals and firmshad a few other arguments cant remember them all... ;
What'd you peeps do for Q11

Also, craaap, I think I went a bit too micro on Q12. It said specifically good for consumers and firms though, so that should be fine right?

I talked mostly about consumers benefits and cons, producers benefits and cons, then in the evaluation I talked about macroecon objective implications. That should be fine, right?
12. Anyone do Essays 9, 10? Second lot on Deflation? What was your argument for the 25 marker?
13. (Original post by Caius Filimon)
What'd you peeps do for Q11

Also, craaap, I think I went a bit too micro on Q12. It said specifically good for consumers and firms though, so that should be fine right?

I talked mostly about consumers benefits and cons, producers benefits and cons, then in the evaluation I talked about macroecon objective implications. That should be fine, right?
What was Qn 11 called again? I have a really bad memory
Also what pros and cons did you do for qn 12?
14. (Original post by AWrd)
What was Qn 11 called again? I have a really bad memory
Also what pros and cons did you do for qn 12?
Q11 should be about how customs unions may change the volume and pattern of (international?) trade.

I'll write that in a sec.
15. (Original post by High Stakes)
I did all the conversions before rounding: got 22752.68817 which I rounded to 22753

Doesn't matter tho it's only worth 1-2 marks. The rest come from the point of comparison which is easy.
You better be right kiddo, because I got exactly the same as you.
16. (Original post by GuydeMaupassant)
You better be right kiddo, because I got exactly the same as you.
haha. I was in the exam asking myself literally "how many zeros are there in a billion".

Should be correct.

22753 euros per capita!!
17. am i the only one who ran out of time and didnt complete the whole paper??
you guys how many marks could i loose if i didn't write a conclusion
18. (Original post by jackm7)
Anyone do Essays 9, 10? Second lot on Deflation? What was your argument for the 25 marker?
> Define deflation / inflation
> Current inflation rate - Measured using CPI.
> Current MPC target 2 %

> Point 1: Benefits of Low Inflation (e.g. competitive prices, consumer confidence etc.)
> Point 2: Role of MPC and how they would respond to inflation below the target (i.e. transmission mechanism)
> Point 3: Low inflation could indicate economy has recently left a recession --> Boom Bust --> Therefore government can employ reflationary policies --> Economic growth without it being unsustainable.

Conclusion:
> Depends on how the low inflation occurred.
> MPC target is 2% +/- 1% because it's difficult to accurately measure inflation
19. (Original post by cherry1997)
am i the only one who ran out of time and didnt complete the whole paper??
you guys how many marks could i loose if i didn't write a conclusion
Conclusions provide an opportunity for overall evaluation which can gain you a few marks, but if you don't get round to doing one you won't lose much (supposing you lost those marks because you were working on another point). You might lose 2-4 marks.
20. (Original post by jackm7)
Anyone do Essays 9, 10? Second lot on Deflation? What was your argument for the 25 marker?
Yeah I did! I did benefits of comparatively cheaper goods on the int. market and then evaluated with the fact we have comp. adv. in services so doesnt help massively. Then I did delayed expenditure using Japan as an example and the impact with employment and cycle of lacklustre growth using phillips curve. My judgement was around whether it was demand side or supply side causes and if it persists - used the fact our deflation was mainly from falling oil and once taking petrol out of CPI we had decent inflation.

Wbu?

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