OCR F581 Markets in Action - 11 May 2015

How are you to structure the 18 marker if you're given two policies e.g whether indirect taxation of regulation is better, do you have to do analysis for both and evaluations for both ? Surely that would be a very long essay...

Reply 1201

mickel_w

9

Is what im saying here correct? -

For underprovision of goods that create positive externalities, 2 demand curves, one showing the private benefit, and one ti the right of it showing social benefit

For overprovision of goods that create negative externalities, 2 supply curves, one showing private cost and another showing social cost to the left of the first one

For overprovision of demerit goods, two demand curves , D1 to the left of D

For underprovision of merit goods, the opposite to the above? I.e. D1 is to the right of D.

Reply 1202

keynes24

10

Original post by hannb98

could someone do a general essay structure for if its on state provision? Not sure how to hit all the levels

State provision is not part of the syllabus. If you still need help post the question and your plan.

Reply 1203

hannb98

3

Original post by CamilleClarke

How are you to structure the 18 marker if you're given two policies e.g whether indirect taxation of regulation is better, do you have to do analysis for both and evaluations for both ? Surely that would be a very long essay...

doubt they would ask for two directly, more like to say one method and then use the words 'most' etc in the Q..
but yeah you would only need to do one - i would do taxation. then compare to regulation in the L4 comments and reach a conclusion

Reply 1204

hannb98

3

Original post by keynes24

State provision is not part of the syllabus. If you still need help post the question and your plan.

I know but there has still been questions..
Jan 2010: Discuss whether healthcare in the UK should be provided by the government or the private sector (18 marks)

Reply 1205

keynes24

10

Original post by hannb98

I know but there has still been questions..
Jan 2010: Discuss whether healthcare in the UK should be provided by the government or the private sector (18 marks)

That's a bit different. I have written a small plan for that question already. It refers to the case for/against government intervention

Reply 1206

mickel_w

9

What are some pros and cons of tax? I only have 4 of each...

Reply 1207

hannb98

3

Original post by keynes24

That's a bit different. I have written a small plan for that question already. It refers to the case for/against government intervention

could you please share this?

(edited 8 years ago)

Reply 1208

midgemeister7

17

Original post by mickel_w

What are some pros and cons of tax? I only have 4 of each...

You don't really need pros other than hypothecation and perhaps that it's market based, you only really need cons and 4 is fine

Reply 1209

_Fergo

19

Original post by mickel_w

What are some pros and cons of tax? I only have 4 of each...

4 of each are more than enough.

Posted from TSR Mobile

Reply 1210

CamilleClarke

Original post by hannb98

doubt they would ask for two directly, more like to say one method and then use the words 'most' etc in the Q..
but yeah you would only need to do one - i would do taxation. then compare to regulation in the L4 comments and reach a conclusion

Thank you

!

Reply 1211

hannb98

3

Original post by mickel_w

What are some pros and cons of tax? I only have 4 of each...

thats more than enough anyway!!!
pros: market based, reduces overconsumption... incentive to improve further (emissions -> unlike regulation), increases gov revenue - can be hypothecated. polluter pays so internalises externalities.

cons: reduces competitiveness -> lobbying/unemployment, what size?-> gov failure, what is social optimum?, opportunity cost, regressive so unfair, depends on PED -> inelastic.... , tax avoidance eg relocation of production or can buy goods overseas (e.g. booze cruises).

Reply 1212

A level sufferer

18

Original post by midgemeister7

You don't really need pros other than hypothecation and perhaps that it's market based, you only really need cons and 4 is fine

Is Hypothecation AS, I only know it from F584 and havent seen it on any revision material or past papers thus far

Reply 1213

hannb98

3

Original post by A level sufferer

Is Hypothecation AS, I only know it from F584 and havent seen it on any revision material or past papers thus far

not required but shows a good understanding!

Reply 1214

NooNoo1

3

is the whole point of government provision to make the social costs=private costs or the social benefits=private benefits??

Reply 1215

omar8888

1

Does inelastic supply mean price decreases by more following a subsidy than when supply is elastic? HELPPP

Reply 1216

CamilleClarke

There is no diagram for public goods is there, because they are an example of a missing market?

Reply 1217

Pato1

13

okay so can someone tell me which essay topics do NOT need graphs

Reply 1218

midgemeister7

17

Original post by Pato1

okay so can someone tell me which essay topics do NOT need graphs

Ideally they all do

Reply 1219

BigFreakyGinger

2

Original post by omar8888

Does inelastic supply mean price decreases by more following a subsidy than when supply is elastic? HELPPP

PES is irrelevant when addressing subsidies as subsidies decrease the Costs of Production which causes supply to increase (Shift right) The size of shift will not be different for an inelastic supply curve. The best way to answer that question is if you draw a diagram showing an increase in inelastic supply along the demand curve and then an increase in elastic supply along the demand curve. The equilibrium price/quantity will still be the same, no matter what the price elasticity of supply. It is the Price elasticity of demand that will determine a subsidy's effectiveness.

(edited 8 years ago)

OCR F581 Markets in Action - 11 May 2015

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