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    because, speculators can work together so that they for example sell the currency all at once, so that the pegged value is over valued....they then buy back the currency when it has changed..therefore profits has been made
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    (Original post by Ollie Warwick)
    My class and my teacher seem to think that this will be the question for the 20 marker,

    "Discuss the extent to which Estonia has progressed towards sustainable development"

    Thoughts?
    i find this one very tricky
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    (Original post by zubhav)
    Policies for Estonia to achieve it's 4 stated goals! I'm just thinking of policies that government could implement to reduce income inequality etc


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    make tax more progressive to reduce income inequality, (re distribute income from rich to poor)
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    (Original post by Legend12)
    Guys, one quick revision tip.

    I'm going through each extract (including introduction) and highlighting key points with questions that could be given on them. I've literally wrote "why" or "how does this..." on some of the paragraphs so I can be prepared for any questions.

    I'm making a case study guide, though my teacher will produce one anyway, that has key definitions from each extract, key points and expanded analysis. For example, the introduction talks about a single currency, so I've made a page saying what it is, the benefits for and against etc...

    If anyone would like a final copy of that, let me know. Hopefully I can complete it latest by 3 weeks.
    hello just came across this would love a copy if possible thanks
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    (Original post by Alexdoble)
    Other reasons include:

    Imported inflation
    Cost push inflation (this is link with imported inflation)
    Capital flight leading to a reduction in LRAS
    what is imported inflation
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    (Original post by jordan6278)
    Explain two possible reasons for high rates of GROWTH in Estonia in 2006-08
    -increase in fdi (increases investment which is a component of AD)
    -fdi creates jobs increasing employment - more people have higher incomes and may spend on goods and services (increases AD as consumption increaes)
    availability of cheap credit from Swedish banks(increased consumption)
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    (Original post by Legend12)
    Guys, one quick revision tip.

    I'm going through each extract (including introduction) and highlighting key points with questions that could be given on them. I've literally wrote "why" or "how does this..." on some of the paragraphs so I can be prepared for any questions.

    I'm making a case study guide, though my teacher will produce one anyway, that has key definitions from each extract, key points and expanded analysis. For example, the introduction talks about a single currency, so I've made a page saying what it is, the benefits for and against etc...

    If anyone would like a final copy of that, let me know. Hopefully I can complete it latest by 3 weeks.
    Would like a copy
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    'Analyse the possible causes of the recession in Estonia in 2008 and 2009'

    Anyone able to help with this question?
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    Comment on whether fdi was the sole reason for estonias impressive economic growth and development (10)

    i know what i would write explaining how FDI caused significant economic growth but when analysing and evaluating what other reasons could you give for their growth and development ?
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    discuss the extent to which high levels of growth in Estonia have lead to sustainable development?????
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    analyse the extent to which membership of ERM 2 limits the fiscal policy of lativa and lithuania? (6)

    Comment on the impact of economic convergence on the economies of Lativa and Lithuania (10)?

    Any help on what to answer foe these please?
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    a few more questions - any help would be great :

    E
    • xplain what is meant by the Harmonised Index of Consumer Price
    • To what extent is GDP per head a good measure of living standars in a country?
    • Explain why a competitive banking sector is considered important.
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    It's creeping closer... :afraid:
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    (Original post by Student8)
    a few more questions - any help would be great :

    E
    • xplain what is meant by the Harmonised Index of Consumer Price
    • To what extent is GDP per head a good measure of living standars in a country?
    • Explain why a competitive banking sector is considered important.

    I can try and help with the second two, the first one is kinda note form, just good and bad things about the measure!



    To what extent is GDP per head a good measure of living standars in a country?
    GDP is the total value of goods and services produced within a country's borders in a given time period eg. a year.


    This is a bad measure because it takes into account a nation as a whole when a large majority may be living in poverty eg. in Estonia most live in low living standards and 50% of GDP comes from the capital alone.
    It is a good measure for measuring economic growth, as if the economy is growing, living standards usually increase too.
    It is a bad measure because if population exceeds output the economy may be growing at a slower rate than population leading to a decrease in living standards. ie. the figure calculate will not be reflective of true conditions in Estonia.
    GDP per head is a poor measure because if more is produced but the extra output consists of capital goods, people will not immediately feel better off although they will be in the long run.
    GDP per capita is bad because positive and negative externalities are not taken into acount. GDP may rise but pollution may also rise therefore lowering the quality of life.


    The ISCW subtracts negative effects from GDP to arrive at a more representative figure for GDP. Therefore, this is a more useful tool for measuring living standards than GDP per capita.




    Explain why a competitive banking sector is considered important.
    A well functioning banking system facilitates the exchange of goods and services, provides incentives for saving and efficiently channels them to productive investments. It supports and promotes a more efficient allocation of resources in the economy. A healthy, robust and stable banking sector plays a crucial role in supporting economic activity, promoting economic growth and ensuring financial stability.
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    (Original post by BIGBLOIS)
    'Analyse the possible causes of the recession in Estonia in 2008 and 2009'

    Anyone able to help with this question?
    -over reliance on international trade, as the global financial crises hit, it affected estonia more because international trade was 155% of gdp

    i cant really think of a second point though, i would say capital flight but i'm not entirely sure if its rcorrect
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    (Original post by Student8)
    a few more questions - any help would be great :

    E
    • xplain what is meant by the Harmonised Index of Consumer Price
    • To what extent is GDP per head a good measure of living standars in a country?
    • Explain why a competitive banking sector is considered important.
    EXPLAIN WHY A COMPETITIVE BANKING SECTOR IS CONSIDERED IMPORTANT

    A competitive banking sector is important because being competitive means they can attract investors to deposit money into estonian banks due to high interest rates. If more people deposit money into the banks, then it may increase private sector investment as banks would be able to lend money to domestic firms to finance their investment project (savings=investment). This would lead to an increase in aggregate demand cetris paribus as investment is a component of AD (C+I+G(X-M)), this would lead to growth increasing employment income and output.

    hope this helped
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    (Original post by ebduff)
    I can try and help with the second two, the first one is kinda note form, just good and bad things about the measure!



    To what extent is GDP per head a good measure of living standars in a country?
    GDP is the total value of goods and services produced within a country's borders in a given time period eg. a year.


    This is a bad measure because it takes into account a nation as a whole when a large majority may be living in poverty eg. in Estonia most live in low living standards and 50% of GDP comes from the capital alone.
    It is a good measure for measuring economic growth, as if the economy is growing, living standards usually increase too.
    It is a bad measure because if population exceeds output the economy may be growing at a slower rate than population leading to a decrease in living standards. ie. the figure calculate will not be reflective of true conditions in Estonia.
    GDP per head is a poor measure because if more is produced but the extra output consists of capital goods, people will not immediately feel better off although they will be in the long run.
    GDP per capita is bad because positive and negative externalities are not taken into acount. GDP may rise but pollution may also rise therefore lowering the quality of life.


    The ISCW subtracts negative effects from GDP to arrive at a more representative figure for GDP. Therefore, this is a more useful tool for measuring living standards than GDP per capita.




    Explain why a competitive banking sector is considered important.
    A well functioning banking system facilitates the exchange of goods and services, provides incentives for saving and efficiently channels them to productive investments. It supports and promotes a more efficient allocation of resources in the economy. A healthy, robust and stable banking sector plays a crucial role in supporting economic activity, promoting economic growth and ensuring financial stability.
    really helpful, thank you
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    (Original post by mrsmeagol)
    EXPLAIN WHY A COMPETITIVE BANKING SECTOR IS CONSIDERED IMPORTANT

    A competitive banking sector is important because being competitive means they can attract investors to deposit money into estonian banks due to high interest rates. If more people deposit money into the banks, then it may increase private sector investment as banks would be able to lend money to domestic firms to finance their investment project (savings=investment). This would lead to an increase in aggregate demand cetris paribus as investment is a component of AD (C+I+G(X-M)), this would lead to growth increasing employment income and output.

    hope this helped
    yeah thats great, thank you.
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    (Original post by mrsmeagol)
    -over reliance on international trade, as the global financial crises hit, it affected estonia more because international trade was 155% of gdp

    i cant really think of a second point though, i would say capital flight but i'm not entirely sure if its rcorrect
    Thanks, first point sounds like a decent one!
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    (Original post by mrsmeagol)
    EXPLAIN WHY A COMPETITIVE BANKING SECTOR IS CONSIDERED IMPORTANT

    A competitive banking sector is important because being competitive means they can attract investors to deposit money into estonian banks due to high interest rates. If more people deposit money into the banks, then it may increase private sector investment as banks would be able to lend money to domestic firms to finance their investment project (savings=investment). This would lead to an increase in aggregate demand cetris paribus as investment is a component of AD (C+I+G(X-M)), this would lead to growth increasing employment income and output.

    hope this helped
    Doesn't a competitive banking sector mean low interest rates. As far as I know, this will increase spending and encourage burrowing to invest.


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