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    (Original post by pessimist)
    Anyone else do question 2? If so, what application did you use in the 30 marker? I said that reducing the deficit would improve Environment (less investment, so less negative externalities), Improves price stability(rise in income tax would cut consumption, so less demand pull inflation) and lowers unemployment ( less govt expenditure on benefits which makes getting a job more attractive).


    Posted from TSR Mobile
    Mmm... I said it might improve price stability because in the extract it mentioned base rate 0.5%, so that might stimulate C and I. I also mentioned that it could worsen income inequality because more taxes, and that it could worsen (structural) unemployment because less spending on education and training, for example.
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    (Original post by ljh950912)
    Yo, what did you say about how a change in the world economy affect the price of oil?


    Posted from TSR Mobile
    Whats good

    yeah i said a world boom meaning excessive demand for the oil ( ahh crap i forgot to say demand pull) raising the price

    and i said a shortage in oil in the world eco


    What did you say
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    (Original post by S.B_123)
    Mmm... I said it might improve price stability because in the extract it mentioned base rate 0.5%, so that might stimulate C and I. I also mentioned that it could worsen income inequality because more taxes, and that it could worsen (structural) unemployment because less spending on education and training, for example.
    Wouldn't stimulating C and I create Inflationary pressures?


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    (Original post by Farringtonn)
    What did people put for the question about assessing how a decrease in real income will lead to a decrease in uk living standards?
    I absolutely hated that question!!!! I mentioned how their cost of living might go up because most income is going to necessities like shelter, food... so consumption of normal goods might decrease. Don't remember what else I said but I hated that!!! I also hated the question about two reasons why CPI was above/below? target
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    (Original post by pessimist)
    Wouldn't stimulating C and I create Inflationary pressures?


    Posted from TSR Mobile
    I think my eval for that was it's good because the economy's in a down turn... but it depends on position on LRAS curve, so it may cause inflationary pressures if the economy's on the inelastic part of the curve
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    (Original post by Brandon_RNS)
    Whats good

    yeah i said a world boom meaning excessive demand for the oil ( ahh crap i forgot to say demand pull) raising the price

    and i said a shortage in oil in the world eco


    What did you say
    I put the same points as you (low availability and an increase in world population) I went straight up unit 1 economics and talked about rationing function and excess demand haha, it was very much microeconomics tbh.
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    (Original post by Brandon_RNS)
    Whats good

    yeah i said a world boom meaning excessive demand for the oil ( ahh crap i forgot to say demand pull) raising the price

    and i said a shortage in oil in the world eco


    What did you say
    I said the global recession means less output for firms and so they dont need as much oil so less demand for oil so price going down


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    (Original post by S.B_123)
    I absolutely hated that question!!!! I mentioned how their cost of living might go up because most income is going to necessities like shelter, food... so consumption of normal goods might decrease. Don't remember what else I said but I hated that!!! I also hated the question about two reasons why CPI was above/below? target
    That question was awful, had to waffle. Although, a definite valid point would be lower disposable income. I can't remember what else I said.


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    (Original post by S.B_123)
    I think my eval for that was it's good because the economy's in a down turn... but it depends on position on LRAS curve, so it may cause inflationary pressures if the economy's on the inelastic part of the curve
    Oh yeah, arghh


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    (Original post by pessimist)
    Anyone else do question 2? If so, what application did you use in the 30 marker? I said that reducing the deficit would improve Environment (less investment, so less negative externalities), Improves price stability(rise in income tax would cut consumption, so less demand pull inflation) and lowers unemployment ( less govt expenditure on benefits which makes getting a job more attractive).Posted from TSR Mobile
    Hey yeah. I did that question. I put down that a Decrease in gvmt spending meant the less money is injected into the circular flow of income and ad taxes increased more money withdrawn etc so a low rate of inflation was maintained the balance of payments got better and also the environment thing u said I said as well then I talked about low unemployment and lower something else and then spoke about how long I takes for changes I the fiscal policy to actually take place and also drew a diagram
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    (Original post by S.B_123)
    I absolutely hated that question!!!! I mentioned how their cost of living might go up because most income is going to necessities like shelter, food... so consumption of normal goods might decrease. Don't remember what else I said but I hated that!!! I also hated the question about two reasons why CPI was above/below? target
    I hated those questions too! what did you put for the two reasons why CPI was above/below target?
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    (Original post by Fullycorporate)
    I put the same points as you (low availability and an increase in world population) I went straight up unit 1 economics and talked about rationing function and excess demand haha, it was very much microeconomics tbh.

    Yeah your answer is more direct than mine well done i didnt write too much in that question didnt like it. Was the very last question i did...skipped it at the beginning.
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    (Original post by xstarsx67)
    did anyone do question 1? If so, what did you get for the calculating index question? (The first one) please reply! Thanks
    i got a 277.7 for the index!!!! what did u get?
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    (Original post by pessimist)
    That question was awful, had to waffle. Although, a definite valid point would be lower disposable income. I can't remember what else I said.Posted from TSR Mobile
    Yeah I said that but to evaluate it I said that there may be better measures of living standards and it depends on by how much incomes fall In real terms to ev it. Hope that is ok
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    (Original post by S.B_123)
    I absolutely hated that question!!!! I mentioned how their cost of living might go up because most income is going to necessities like shelter, food... so consumption of normal goods might decrease. Don't remember what else I said but I hated that!!! I also hated the question about two reasons why CPI was above/below? target
    I wrote about that 2 and I said it would lead to less consumption which would shift Ad and lower demand means firms would cut back so this would cause unemployment then linked it to living standards. Yeah I hated that question to I had no idea what to write I went on about demand pull and cost push iflation which was probably wrong. In fact I hated the whole paper, felt like I did everything wrong dreading results
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    (Original post by AM_Broadcasts)
    i got a 277.7 for the index!!!! what did u get?
    Am i the only nig to round that wretched number to 278 smh
    Lord have mercy
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    Yeah it was more like a unit 1 question. I drew a supply&demand diagram lol


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    (Original post by HKhan12)
    Yeah I said that but to evaluate it I said that there may be better measures of living standards and it depends on by how much incomes fall In real terms to ev it. Hope that is ok
    I said they're subjective and living standards are hard to measure and also the same as you with how much it falls by, sure it said 0.3% in the passage
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    (Original post by xstarsx67)
    You know if you got the answer to the index one wrong? (Like I put 177 instead of 277) don't ask me how I'm just really stupid would you still get like maybe 1 or 2 marks? Cos it was a 6 mark question, so surely they should credit something even if it was wrong? Or no?
    (Original post by Soufflegirl)
    I got that too. I defined base year at the beginning and maybe we'll get marks for the correct values for Jan 2005 and March 2012. Here's hoping!


    This was posted from The Student Room's iPhone/iPad App
    Heya I put down 177.77 etc for the percentage change (24-125)/45*100...BUT I think I figured out why its 277.77

    Basically the base year is 100. The increase is 177.777 therefore the index is 277.77

    Can someone clarify if this is correct? (if it is we should get like 2 marks at least for the % change!)
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    (Original post by pessimist)
    Anyone else do question 2? If so, what application did you use in the 30 marker? I said that reducing the deficit would improve Environment (less investment, so less negative externalities), Improves price stability(rise in income tax would cut consumption, so less demand pull inflation) and lowers unemployment ( less govt expenditure on benefits which makes getting a job more attractive).


    Posted from TSR Mobile
    Pretty much the same thing.
    Here is my structure for the 30 marker for the second question.

    Defined contractionary fiscal policy.
    Defined budget deficit.
    I said that to lower deficit they would have to increase and/or reduce government spending.
    I also outlined the macroeconomic objectives.

    I said government can lower its spending such as welfare benefits. This reduces the AD as people have less money to spend and consumption is likely to fall.
    Draw an AD and AS diagram. Explained the diagram and what is happening.

    Then I said clearly there is a fall in output although this goes against a macro objective of growth but it does mean that there will be improvement in the environment as less is being produced.
    Then I said that prices have fallen - hence this allows the government to control prices and keep them stable.

    I said that the economy has moved away from full employment position as AD has shifted backward however this can cause inequality as more an more are likely to become unemployed.

    However this may not hold true as a cut in welfare benefits may actually create incentive for people to get a job and hence employment may actually improve.

    I said the extent to which AD falls depends on the size of the multiplier and I also draw a classical LRAS and said that a fall in AD will not change output and hence environment may not improve.

    Then I said government can also increase tax and ceteris paribus this can improve the deficit.
    Then talked about direct and indirect taxes. I said they can reduce corporation taxes and then defined corporation tax. I said using the tax they will be able to redistribute income much more equally and hence reduce inequality and said that AS is likely to fall back and hence reduction output and prices going up (can't exactly remember if I made another point on corporation tax).

    I evaluated using the Laffer curve. Said that maybe government is already at the optimum position with their tax rate and a rise in tax may mean that they're being inefficient while reduce less revenue.

    Then I quickly mentioned that borrowing is one more option to finance their deficit but this may increase the national debt and a fall in credit rating in the future and hence making it difficult for governments to subsidise industries and remain internationally competitive and hence it has a negative impact in the long run on the BOP if not managed properly.

    Then I rounded it off by saying that the success of this policy depends on what the macro objective of the government is. If the objective is to reduce pollution and control a hyper inflation then this maybe a good solution but if they want growth then this may be a wrong decision to make, although they can have a contractionary fiscal policy but still remain growth by using other policies such as expansionary monetary policy.


    What do you guys make of this?
 
 
 
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