OCR F581 Markets in Action - 11 May 2015 Watch

_Fergo
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#1521
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#1521
(Original post by Liam_27)
What did people get for the 2 reasons why different agricultural products would have different levels of elasticity?
Degree of necessity/habit forming goods.

(Original post by Pato1)
What does consumer surplus look like after the quantity supplied falls?
It decreases, as price increases.

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mayhs98
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#1522
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#1522
For the very first question (4 marks) I put the definition of the basic economic problem being: when there is a lack of scarce resources in the economy available to meet the wants + needs of consumers. For my example I put something along the lines of: In the case study it says that there is a lack of water so water can be a resource that is lacking and not available to consumers who want + need products linked to water or water itself.


How many marks would I get?
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_Fergo
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#1523
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#1523
(Original post by mayhs98)
For the very first question (4 marks) I put the definition of the basic economic problem being: when there is a lack of scarce resources in the economy available to meet the wants + needs of consumers. For my example I put something along the lines of: In the case study it says that there is a lack of water so water can be a resource that is lacking and not available to consumers who want + need products linked to water or water itself.


How many marks would I get?
Consumers should be producers.

Otherwise seems okay.

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Helpme_1
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#1524
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#1524
Ok for the 18 marker i think i might of ****ed up. Instead of talking about underconsumption i talked about( using the example of trains/cars) that subsidising a merit good like trains would cause price to fall increasing the demand for them, therefore the demand for the subistute demeirt good would fall. As anaylsis i said it depends on how good the subisitute is, e.g trains are considered an inferior good so people are still unlikrly to switch and that it also depends on if the producers pass the subisdy on to the consumera in the form of lower prices.

Is this still going to get me some marks?
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Formless
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#1525
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#1525
(Original post by *Stefan*)
That's irrelevant. It didn't specify the case study as far as I remember, but even if it did, the hypothetical question ought to make all answers acceptable.

Otherwise, it would have said "Basing your answer on the case study, explain why the price of X significantly increased" -not conditional here, so it should then have been specific.

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So are you saying that both demand and supply must shift for full marks, or a single shift would suffice?
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Tedarien
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#1526
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#1526
Hardest paper I've done.
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sushanlol
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#1527
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#1527
For one of the 18 mark evaluation points I suggested how the subsidy is an opportunity cost to the government in which the government will have less government revenue and therefore less expenditure can be made for public benefits, reducing social welfare and creating a market failure through government failure. I don't know if this would gain me marks as it doesn't determine the effectiveness of a subsidy, would I still gain lvl4 marks?
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_Fergo
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#1528
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#1528
(Original post by Helpme_1)
Ok for the 18 marker i think i might of ****ed up. Instead of talking about underconsumption i talked about( using the example of trains/cars) that subsidising a merit good like trains would cause price to fall increasing the demand for them, therefore the demand for the subistute demeirt good would fall. As anaylsis i said it depends on how good the subisitute is, e.g trains are considered an inferior good so people are still unlikrly to switch and that it also depends on if the producers pass the subisdy on to the consumera in the form of lower prices.

Is this still going to get me some marks?
I think you confused it with taxation mate. Are you sure this is how you answered the question?

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Pato1
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#1529
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#1529
(Original post by *Stefan*)
Degree of necessity/habit forming goods.



It decreases, as price increases.

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Can someone show me what this looks like on a graph?
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EconomicsBS
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#1530
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#1530
(Original post by mayhs98)
For the very first question (4 marks) I put the definition of the basic economic problem being: when there is a lack of scarce resources in the economy available to meet the wants + needs of consumers. For my example I put something along the lines of: In the case study it says that there is a lack of water so water can be a resource that is lacking and not available to consumers who want + need products linked to water or water itself.


How many marks would I get?
I think this would be 3 marks as you haven't specified the CHOICE or OC.
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_Fergo
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#1531
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#1531
(Original post by Pato1)
Can someone show me what this looks like on a graph?
Google "decrease in consumer surplus" and look at the second part of the third picture. It's just the other way round.

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Helpme_1
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#1532
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#1532
(Original post by *Stefan*)
I think you confused it with taxation mate. Are you sure this is how you answered the question?

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Yes i basically did it like taxation but in reverse, so instead of saying how the tax decreases demand for the demerit good and increases demand for the merit good I explained how the subsidy could do the opposite.
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alicec11
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#1533
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#1533
i did consumer!! But I didn't know how to label as they say not to shade so I just showed the shift from A to B?
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mayhs98
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#1534
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#1534
For the 4 marker when it is talking about why price elasticity is increasing for some agricultural goods and explain 2 reasons for this would TIME be an acceptable reason with an example? I also put changes in fashion/tastes with an example?
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Anon606
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#1535
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#1535
For the 18 marker I gave a description on why market failure occurs due to merit goods being under consumed and demerit goods being over consumes etc

I then went on to draw a diagram and showed how a subsidy would shift out supply etc

I then spoke about if PED was inelastic it would need a large subsidy

Then opportunity cost of the subsidy, could be spent elsewhere

Diagram showing the marginal social benefit

Then how much would go to consumers and producers

Then a conclusion which was pretty weak and didn't compare to other methods

Thoughts?


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EconomicsBS
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#1536
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#1536
(Original post by mayhs98)
For the 4 marker when it is talking about why price elasticity is increasing for some agricultural goods and explain 2 reasons for this would TIME be an acceptable reason with an example? I also put changes in fashion/tastes with an example?
Fashions/Tastes is definitely wrong. This is a determinant of demand- NOT of PED.
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_Fergo
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#1537
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#1537
(Original post by alicec11)
i did consumer!! But I didn't know how to label as they say not to shade so I just showed the shift from A to B?
You can shade it as well. Points are absolutely fine too.

(Original post by mayhs98)
For the 4 marker when it is talking about why price elasticity is increasing for some agricultural goods and explain 2 reasons for this would TIME be an acceptable reason with an example? I also put changes in fashion/tastes with an example?
Time is. Change in fashion/tastes unfortunately isn't. This is a determinant of demand...

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alicec11
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#1538
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#1538
(Original post by Liam_27)
What did people get for the 2 reasons why different agricultural products would have different levels of elasticity?
I wrote Habit forming goods and Degree of necessity. I probably should have chosen substitute though!
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mayhs98
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#1539
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#1539
(Original post by EconomicsBS)
Fashions/Tastes is definitely wrong. This is a determinant of demand- NOT of PED.

Yeah i thought so hopefully I get the 2 marks then for my time reason
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_Fergo
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#1540
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#1540
(Original post by alicec11)
I wrote Habit forming goods and Degree of necessity. I probably should have chosen substitute though!
I agree on that. I was so damn stuck in remembering another one! Both are acceptable though...

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