OCR F581 Markets in Action - 11 May 2015 Watch

Super199
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#681
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#681
(Original post by keynes24)
That's an A2 question
Haha good she was going through the structure and it seemed a bit crap.

The structure was something along the lines of:

L1- Definitions of competitive marker and allocative efficiency

L2 - Examples of competitive market

L3 - Mentioned some stuff XED and that if the price of carrots from a certain shop went up you would instantly switch. PED = Elastic.
Something about merit goods -> Under-produced and under-consumed. Positive externality diagram. Saying you want to get MSB=MSC to get allocative efficiency.

Then I can't remember what on earth she said for L4. Is that stuff definitely A2?
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Super199
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#682
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(Original post by Makashima)
Ahhh cool, I think for the 6 markers, it will likely be public goods if not information failure considering last year it was negative externalities of the Chinas production...PED appeared last year and YED is very popular so I think maybe PES or XED
I can never do 6 markers on negative externalities. Care to talk me through one ?
Like normally I get 3/6.
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keynes24
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(Original post by Super199)
Haha good she was going through the structure and it seemed a bit crap.

The structure was something along the lines of:

L1- Definitions of competitive marker and allocative efficiency

L2 - Examples of competitive market

L3 - Mentioned some stuff XED and that if the price of carrots from a certain shop went up you would instantly switch. PED = Elastic.
Something about merit goods -> Under-produced and under-consumed. Positive externality diagram. Saying you want to get MSB=MSC to get allocative efficiency.

Then I can't remember what on earth she said for L4. Is that stuff definitely A2?
Is this planning provided by your teacher?
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craigdrm
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#684
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#684
I don't think you would ever implicitly be required to draw a externalities diagram. the specification says to explain externalities not analyse or assess like it does supply and demand diagrams.
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Super199
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(Original post by keynes24)
Is this planning provided by your teacher?
Yeah it seems a bit crap.
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Makashima
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#686
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#686
(Original post by Super199)
I can never do 6 markers on negative externalities. Care to talk me through one ?
Like normally I get 3/6.
Umm this is how I do it...dont think itd be 6 marks, depends how you write it up

Define negative externality
Identify the cost
Say how and who is impacted
Explain/Elaborate how does this impact affect the whole society
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keynes24
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(Original post by Super199)
Yeah it seems a bit crap.
I don't understand the planning. Market structures is not part of the syllabus so it cannot be part of the F581 paper. You can either get a question on allocative efficiency or productive efficiency but not in the context that you mentioned but as a short answer question.
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Super199
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(Original post by Makashima)
Umm this is how I do it...dont think itd be 6 marks, depends how you write it up

Define negative externality
Identify the cost
Say how and who is impacted
Explain/Elaborate how does this impact affect the whole society
I sort of see.

Question 5b. June 2009.

'Explain why negative externalities arising from an increase in air transport are an example of market failure'.

A negative externality is where the social costs of an action exceed the private costs. They are over produced and over consumed. The social cost would be the CO2 emissions. This would contribute to global warming and those not directly involved will be affected. Another negative externality would be excessive noise disturbance, this would affect those not directly living around the airport to be affected. As the social costs of both noise disturbance out weigh the private cost of dunno what we have a negative externality.

That is what I would write without the mark scheme. Care to edit that and help me improve it? Thanks
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Yousf
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#689
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On a tradeable permits diagram when p1 moves to p2 what does this mean? is it an increase in firms cost of production??
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Super199
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(Original post by keynes24)
I don't understand the planning. Market structures is not part of the syllabus so it cannot be part of the F581 paper. You can either get a question on allocative efficiency or productive efficiency but not in the context that you mentioned but as a short answer question.
Right that is good news .

There was also a question to do with tradeable pollution permits and if they are effective at solving negative externality.

What is the diagram and what is the L4 depends upon?
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Super199
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#691
(Original post by Yousf)
On a tradeable permits diagram when p1 moves to p2 what does this mean? is it an increase in firms cost of production??
Is that the polluter's pay principle thing??
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Yousf
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(Original post by Super199)
Is that the polluter's pay principle thing??
The tradeable permits diagram. Like when we show supply curve **** to the left i get q1-q2 means the overproduction of pollution is reduced but does p1-p2 mean an increase in cost of production
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JYNE
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#693
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#693
What are the pros and cons of public goods? Find it a little confusing, thanks
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Makashima
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(Original post by Super199)
I sort of see.

Question 5b. June 2009.

'Explain why negative externalities arising from an increase in air transport are an example of market failure'.

A negative externality is where the social costs of an action exceed the private costs. They are over produced and over consumed hence it is a demerit good. The social cost would be the CO2 emissions. This would contribute to global warming and those not directly involved will be affected. Another negative externality would be excessive noise disturbance, this would affect those living around the airport to be affected and may force them to soundproof their homes at their own expense through no fault of their own. As the social costs of both noise disturbance out weigh the private cost of dunno what we have a negative externality.

That is what I would write without the mark scheme. Care to edit that and help me improve it? Thanks
Tbh this is veeeeeery good! Not sure what else to add (im just a student lol) I just elaborate some points
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san96
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When doing the tradeable pollution permit essay (to lower carbon emissions in this case), is it correct to draw the negative externalities diagram for L2?? I've attached an example of this below:
Name:  tradeable permits L2.jpg
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Makashima
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(Original post by Super199)
I sort of see.

Question 5b. June 2009.

'Explain why negative externalities arising from an increase in air transport are an example of market failure'.

A negative externality is where the social costs of an action exceed the private costs. They are over produced and over consumed. The social cost would be the CO2 emissions. This would contribute to global warming and those not directly involved will be affected. Another negative externality would be excessive noise disturbance, this would affect those not directly living around the airport to be affected. As the social costs of both noise disturbance out weigh the private cost of dunno what we have a negative externality.

That is what I would write without the mark scheme. Care to edit that and help me improve it? Thanks



Oh wait I didnt read the question, I suppose you can say why it is a market failure because the full cost is not being paid and over consumption and over production is an example of allocative inefficiency bc this is where D is not equal to S
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loooolo12345
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quick question:
do regulations affect supply only?
Also what are examples of types of regulations
Thanks
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Makashima
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#698
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#698
A negative externality is where the social costs of an action exceed the private costs. An increase in the airport transport is overproduction hence this is a demerit goods. This is allocatively inefficient hence a market failure because quantity supplied does not equal to quantity demanded due to the rise in supply, and consumer satisfaction is clearly not maximised due to the cost are not being paid. Airport brings social cost such as CO2 emission which contributes to the global warming and affecting those who are not directly involved such as farmers and their crops. Another negative externality would be excessive noise disturbance, this would affect those living near the airport as they may be forced them to soundproof their homes at their own expense through no fault of their own. As the social costs of both noise disturbance out weigh the private cost of dunno what we have a negative externality.

this is an excessively detailed answer, i doubt i can write that in the exam...so dont worry, what you wrote is already good and wouldve gain 4 marks


(Original post by Super199)
I sort of see.

Question 5b. June 2009.

'Explain why negative externalities arising from an increase in air transport are an example of market failure'.

A negative externality is where the social costs of an action exceed the private costs. They are over produced and over consumed. The social cost would be the CO2 emissions. This would contribute to global warming and those not directly involved will be affected. Another negative externality would be excessive noise disturbance, this would affect those not directly living around the airport to be affected. As the social costs of both noise disturbance out weigh the private cost of dunno what we have a negative externality.

That is what I would write without the mark scheme. Care to edit that and help me improve it? Thanks
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JYNE
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#699
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#699
(Original post by loooolo12345)
quick question:
do regulations affect supply only?
Also what are examples of types of regulations
Thanks
Regulations affect both supply and demand for example regulating the legality of drugs, age limits on alcohol and tobacco
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Yousf
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#700
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#700
(Original post by JYNE)
Regulations affect both supply and demand for example regulating the legality of drugs, age limits on alcohol and tobacco
No supply would only shift, demand would contract right....
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