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    (Original post by Stefano46)
    Btw mate, I see you didn't mention that workers may be reluctant to accept a cut in nominal wages. So could we say that altho AD will fall due the components of the transmissions mechanism falling, such as consumption, investment, etc, the fall in the price level may not be as great as we might first assume. Because of the increase in costs of production arrising from the workers asking for other wages and AS shifting left.
    Why would they be reluctant? In an age of deflation, the economy is in trouble for sure (esp. the UK, it heavily relies on spending), so they are more likely to accept in order to keep their jobs. You can also add it depends where we actually are on the AS curve (I'm talking Kaynes here), so if we're on the elastic bit already, then a shift in AD will do bugger all to the price level, and only reduce unemployment.

    (Original post by Stefano46)
    However, once more on the other hand
    *yoink*

    I'm stealing that, nice wording

    (Original post by Stefano46)
    , workers may simply opt to make workers redundant (even with the high redundancy costs)--> unenemployment increases- viscous cycle
    Yeah.

    (Original post by Dan?)
    Well there's an evaluation point I think because there are more low to middle income families than high income, a rising GDP would affect the low to middle income families more. Also, as you said, a family's income would have to rise considerably before people would consider switching to a private school. You're going from no fees, to maybe 10 grand a year?


    That's the one beautiful thing about economics, you can always elaborate and argue as there are always two sides to every point.

    That's what I was suggesting, it depends how much the incomes rose. Private school is expensive.


    Also if I missed a quite, mis-quoted, ignored someone or something please point it out. I'm so drained I probably won't notice.
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    factors that increase protectionism anyone?
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    Hm, thoughts on how a big PSBR can lead to inflation? My revision guide suggest if they print money in order to cope with the debt the result will be inflationary pressure, which is fair enough. But it seems to imply that simply borrowing lots of money can cause inflation, which I find confusing. I understand that high levels of govt. expenditure can cause inflation because it just increases AD and if there's no spare capacity, it just raises prices. But why does the fact that the money's borrowed matter?

    In fact, since the money the government borrows from the tax-payer would probably have been invested elsewhere in the economy...
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    Thanks

    Another question though...is fiscal deficit the diff bet govt expenditure and govt revenue?
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    (Original post by Sweet_poison)
    Thanks

    Another question though...is fiscal deficit the diff bet govt expenditure and govt revenue?
    oui, unless r is bigger than e, in which case it's a surplus. :p:
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    fiscal deficit is when government spending is higher then government revenue
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    (Original post by jayshah31)
    That's the one beautiful thing about economics, you can always elaborate and argue as there are always two sides to every point.

    That's what I was suggesting, it depends how much the incomes rose. Private school is expensive.


    Also if I missed a quite, mis-quoted, ignored someone or something please point it out. I'm so drained I probably won't notice.
    Nothing beautiful about economics It was a bad choice choosing this subject, and then an even worse choice keeping it on at A2. Absolutely cannot wait until 10:45am tomorrow.
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    (Original post by Sweet_poison)
    I asked before n i am asking again...does anybody have any good tips for time management? I am good on my theory but wen it comes to the exam i always tend to run out of time n its annnoying coz i lose marks even wen i know the answers.
    What Dan said plus do the section that you can bag most of the marks on quickest first.
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    I like economics at the moment. It's the only one of my a levels where you can write something and know for sure you got a mark.
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    If I was talking about the effects of a fiscal deficit and I rant on about how taxes will be raised to reduce the deficit.
    Would the following count as evaluation? On the other, the goverment may be unwilling to raise taxes as it would provide a disincentive to work and could lead to lower productivity and slower economic growth.

    Also, when I evaluate I tend to state the disadvantages of a certain measure - eg. a lowering interest rates may encourage consumer spending but this may result in demand push inflation and cause prices to rise etc etc.
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    (Original post by spawn606)
    factors that increase protectionism anyone?
    Sorry?
    - Greater tarrifs
    - Lower quotas / banning the import completely
    - Applying specific taxes
    - Subsidies for local firms
    - Trade blocs (to an extent, evaluate this well)

    (Original post by Grape190190)
    Hm, thoughts on how a big PSBR can lead to inflation? My revision guide suggest if they print money in order to cope with the debt the result will be inflationary pressure, which is fair enough. But it seems to imply that simply borrowing lots of money can cause inflation, which I find confusing. I understand that high levels of govt. expenditure can cause inflation because it just increases AD and if there's no spare capacity, it just raises prices. But why does the fact that the money's borrowed matter?

    In fact, since the money the government borrows from the tax-payer would probably have been invested elsewhere in the economy...
    Perhaps go back to the cause? I admit, I'm not sure either. If you require a large PSBR, you may cause crowding out (different issue). If you spend it all in the economy, multiplier effect + time lags could be inflationary if it's underestimated. If taxes are too low then the debt will rise, again, inflationary if underestimated. I mite blubber onto interest rates, but I'm starting to stray off a bit now.


    (Original post by Dan?)
    Nothing beautiful about economics It was a bad choice choosing this subject, and then an even worse choice keeping it on at A2. Absolutely cannot wait until 10:45am tomorrow.
    Oh yes there is :hubba:

    I think the subject is fine, just the placement of the exam is a little annoying. I mean, M1 + M2 then Eco6 the next day is of no great benefit to anyone.
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    (Original post by Vitamin Sea)
    If I was talking about the effects of a fiscal deficit and I rant on about how taxes will be raised to reduce the deficit.
    Would the following count as evaluation? On the other, the goverment may be unwilling to raise taxes as the provide a disincentive to work and could lead to lower productivity and slower economic growth.

    Also, when I evaluate I tend to state the disadvantages of a certain measure - eg. a lowering interest rates may encourage consumer spending but this may result in demand push inflation and cause prices to rise etc etc.
    Nothing wrong with that. You should probably state income tax though.
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    (Original post by Vitamin Sea)
    If I was talking about the effects of a fiscal deficit and I rant on about how taxes will be raised to reduce the deficit.
    Would the following count as evaluation? On the other, the goverment may be unwilling to raise taxes as it would provide a disincentive to work and could lead to lower productivity and slower economic growth.
    Why would it provide a disincentive? What kind of tax changes (progressive -> regressive)? Lightly touch on political issues perhaps. Why would it lower productivity?

    I'm not trying to put your answer down, merely extend your own evaluation.

    (Original post by Vitamin Sea)
    Also, when I evaluate I tend to state the disadvantages of a certain measure - eg. a lowering interest rates may encourage consumer spending but this may result in demand push inflation and cause prices to rise etc etc.
    I see nothing wrong with that.
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    (Original post by jayshah31)
    Oh yes there is :hubba:

    I think the subject is fine, just the placement of the exam is a little annoying. I mean, M1 + M2 then Eco6 the next day is of no great benefit to anyone.
    Yeah, labour markets was in the same session as FP2 as well. That's one of the reasons I did so badly on FP2, economics took up all my revision time the few days before it
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    (Original post by Dan?)
    Yeah, labour markets was in the same session as FP2 as well. That's one of the reasons I did so badly on FP2, economics took up all my revision time the few days before it
    Snap.

    That sucked to bad it was unbelievable. I hate afternoon exams as it is, but back-to-back like that, that's just taking the monopsony.
    Spoiler:
    Show
    :awesome:


    :getmecoat:
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    (Original post by jayshah31)



    Perhaps go back to the cause? I admit, I'm not sure either. If you require a large PSBR, you may cause crowding out (different issue). If you spend it all in the economy, multiplier effect + time lags could be inflationary if it's underestimated. If taxes are too low then the debt will rise, again, inflationary if underestimated. I mite blubber onto interest rates, but I'm starting to stray off a bit now.
    I guess, by definition, if you have a PSBR, the injection is bigger than the leakage, so there's growth in the money supply.
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    (Original post by jayshah31)
    I'm not trying to put your answer down, merely extend your own evaluation.


    I see nothing wrong with that.
    They were both examples which I made up as I was typing, I just wanted to check whether my method of evaluating was okay because they haven't mention it in the mark schemes.

    Thanks though.
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    (Original post by jayshah31)
    Snap.

    That sucked to bad it was unbelievable. I hate afternoon exams as it is, but back-to-back like that, that's just taking the monopsony.
    Spoiler:
    Show
    :awesome:


    :getmecoat:
    heh.

    A question. How much are you supposed to write in section A of this paper? I've not really done much practice for them.
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    (Original post by Grape190190)
    I guess, by definition, if you have a PSBR, the injection is bigger than the leakage, so there's growth in the money supply.
    Sounds like an interesting idea.

    Where did you get this definition from, and how are people actually revising for this? I'm just on TSR now :indiff:
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    (Original post by jayshah31)
    Why would they be reluctant? In an age of deflation, the economy is in trouble for sure (esp. the UK, it heavily relies on spending), so they are more likely to accept in order to keep their jobs. You can also add it depends where we actually are on the AS curve (I'm talking Kaynes here), so if we're on the elastic bit already, then a shift in AD will do bugger all to the price level, and only reduce unemployment.


    *yoink*

    I'm stealing that, nice wording



    Yeah.





    That's the one beautiful thing about economics, you can always elaborate and argue as there are always two sides to every point.

    That's what I was suggesting, it depends how much the incomes rose. Private school is expensive.


    Also if I missed a quite, mis-quoted, ignored someone or something please point it out. I'm so drained I probably won't notice.
    To be honest, I got the reluctant part from some dodgy site lol.
    Guess you're right. This is lil off the topic, look at the countdown lady (Carol Vorderman) last year who refused her pay cut ---> unemployed or as she put it, for "family reasons"
 
 
 
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