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AQA Economics AS Mon 14 June AM watch

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    (Original post by deianra)

    Min, if you be quiet, I'm hoping he doesn't notice. And it's a very good undergrad.
    Have removed offending post
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    (Original post by corey)
    You may have better definitions than us AQA retards, however at least we actually have to apply our knowledge to the real world - unlike your little theortical exam
    :eek: Children!





    ...Edexcel is better though...
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    (Original post by corey)
    You may have better definitions than us AQA retards, however at least we actually have to apply our knowledge to the real world - unlike your little theortical exam
    Actually you'll find a real world case study in every single edexcel exam paper, taken from sources such as the economist and the times. You are expected to refer to the source when answering questions that follow
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    (Original post by TheWolf)
    so only the keynesians? :confused: i thought the classical curves are the ones used
    My teacher has been an examainer for like 5-6years for economics, and hasn't even mentioned that there even was a difference between the curves! If you look at the mark scheme...no mention in there.

    The diagram in the spec you need to know for macro is;
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    Can someone comment on my plan for this 15 mark question:

    (c) Using the data to help you, asses the likely effects of the growth in comsumer expenditure on the performance of the United Kingdom ecomony during 2001.

    Intro - Consumer expenditure is the private demand for domestic goods - it is a large contributing factor of addregate demand, and can vary based on economic conditions, such as household income and expectations. The performance of the UK economy can be measured by several economic indicators: inflation, unemployment, economic growth and the balance of payments.
    Pro1 - More comsumer spending => more AD => more economic growth (good)(relate to household income rise in extract)
    Pro2 - More comsumer spending => more AD => lower levels of unemployment (which is another economic indicator)(relate to extract)
    Con1 - More comsumer spending => more AD => higher inflation levels (and why this is bad)
    Con2 - higher inflation => damaging gov. policies (tight fiscal,) which can reverse the pros seen earlier in essay.

    Conclusion - rise in AD in a recession can cause a rise in output more than proportional to the rise in inflation, so good idea, but rise in a boom can cause overheating and damage an economy, having worse effects.

    :cool:

    What would anyone else have written? The extract is on the AQS site, it only mentions domestic demand once and sayd it leads to more jobs and higher incomes.

    (Original post by corey)
    My teacher has been an examainer for like 5-6years for economics, and hasn't even mentioned that there even was a difference between the curves! If you look at the mark scheme...no mention in there.

    The diagram in the spec you need to know for macro is;
    What is the label on the x-axis? Income/time?
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    (Original post by corey)
    My teacher has been an examainer for like 5-6years for economics, and hasn't even mentioned that there even was a difference between the curves! If you look at the mark scheme...no mention in there.

    The diagram in the spec you need to know for macro is;
    well that is classical i use keynesian lras too
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    (Original post by deianra)
    Um...I've never seen that in my life before. Ellie, Min? :confused:
    I've seen it, we don't use it. Don't worry, stick to the one you know.
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    (Original post by deianra)
    Um...I've never seen that in my life before. Ellie, Min? :confused:
    I've seen the LRAS before, that's a monetarist curve. In the L/R they assume AS is always at 'full employment'.
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    (Original post by deianra)
    Um...I've never seen that in my life before. Ellie, Min? :confused:
    You don't know the monetarist star diagram? omg... lol
    LRAS represents trend economic growth, SRAS represents current growth but this cna vary (eg. more output in a boom), and AD shifts right and left in recessions and booms, causing -ve and +ve output gaps when equilibrium is left and right of LRAS (respectively).Only a fall in cost of production or generally an expansion of the PPC can shift LRAS right... if SRAS and AD meet to the right the ec. growth is unsustainable.
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    (Original post by mik1a)
    Can someone comment on my plan for this 15 mark question:

    (c) Using the data to help you, asses the likely effects of the growth in comsumer expenditure on the performance of the United Kingdom ecomony during 2001.

    Intro - Consumer expenditure is the private demand for domestic goods - it is a large contributing factor of addregate demand, and can vary based on economic conditions, such as household income and expectations. The performance of the UK economy can be measured by several economic indicators: inflation, unemployment, economic growth and the balance of payments.
    Pro1 - More comsumer spending => more AD => more economic growth (good)(relate to household income rise in extract)
    Pro2 - More comsumer spending => more AD => lower levels of unemployment (which is another economic indicator)(relate to extract)
    Con1 - More comsumer spending => more AD => higher inflation levels (and why this is bad)
    Con2 - higher inflation => damaging gov. policies (tight fiscal,) which can reverse the pros seen earlier in essay.

    Conclusion - rise in AD in a recession can cause a rise in output more than proportional to the rise in inflation, so good idea, but rise in a boom can cause overheating and damage an economy, having worse effects.

    :cool:

    What would anyone else have written? The extract is on the AQS site, it only mentions domestic demand once and sayd it leads to more jobs and higher incomes.



    What is the label on the x-axis? Income/time?
    Yeah Real National Income / time

    The problem with your answer is that you can't get over 8 for it apprently, because you haven't dealt with consumption in itself but looked at it from a component of AD - which is fine but you need look deeper (i made the same mistake when doing this can got 8/15)

    Heres my plan I did on the thread quite a few pages back

    (Original post by corey)
    So...I would look at consumer expenditure as a component of aggregate demand that contributes to over 50% of it, so the growth of consumer expenditure could result in a 'boom' for the economy - but possible risk of inflation blah blah (easy stuff).

    I would also look at how the growth in consumer expenditure is unbalanced toward Durable Goods, which could indicate a problem within the economy, because durable goods tend to be more expensive so we may see a rising debt level (very relevant with today's total debt over a billion or something).

    Durable goods are likely to come from abroad, and we have not seen a recovery of the manufactoring sector - again indicating that the growth is coming from outside imports to the UK, maintaining that the manufactoring sector is in a sturctual decline it cannot get out of. I would also mention that because growth is mostly likely focused in imported durable goods that this may act as a 'release' valve for any inflationary pressure.

    Erm...probably something to say about unemployment also since its mentioned in the data...I'll do this question properly 2moro
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    (Original post by mik1a)
    You don't know the monetarist star diagram? omg... lol
    LRAS represents trend economic growth, SRAS represents current growth but this cna vary (eg. more output in a boom), and AD shifts right and left in recessions and booms, causing -ve and +ve output gaps when equilibrium is left and right of LRAS (respectively).
    We just use the business cycle diagram to show that I think, with the peaks/troughs?
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    to show economic growth use ppf shifting outwards, or business cycle with postive output gap, or keynesian outward lras shift
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    *sigh* you guys are all really good economist. Stop panicking. I never knew half of this stuff for AS. I did about one practise essay out of my own accord.
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    (Original post by Ellie4)
    We just use the business cycle diagram to show that I think, with the peaks/troughs?
    Yeah.

    Corey, what do you mean by "Durable goods are likely to come from abroad, and we have not seen a recovery of the manufactoring sector - again indicating that the growth is coming from outside imports to the UK"...

    surely consumer spending is only for domestic goods, and imported goods by consumers are under the imports section? Or does the questions mean everything consumers buy?
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    (Original post by mik1a)
    Can someone comment on my plan for this 15 mark question:

    (c) Using the data to help you, asses the likely effects of the growth in comsumer expenditure on the performance of the United Kingdom ecomony during 2001.

    Intro - Consumer expenditure is the private demand for domestic goods - it is a large contributing factor of addregate demand, and can vary based on economic conditions, such as household income and expectations. The performance of the UK economy can be measured by several economic indicators: inflation, unemployment, economic growth and the balance of payments.
    Pro1 - More comsumer spending => more AD => more economic growth (good)(relate to household income rise in extract)
    Pro2 - More comsumer spending => more AD => lower levels of unemployment (which is another economic indicator)(relate to extract)
    Con1 - More comsumer spending => more AD => higher inflation levels (and why this is bad)
    Con2 - higher inflation => damaging gov. policies (tight fiscal,) which can reverse the pros seen earlier in essay.

    Conclusion - rise in AD in a recession can cause a rise in output more than proportional to the rise in inflation, so good idea, but rise in a boom can cause overheating and damage an economy, having worse effects.

    :cool:

    What would anyone else have written? The extract is on the AQS site, it only mentions domestic demand once and sayd it leads to more jobs and higher incomes.



    What is the label on the x-axis? Income/time?
    Maybe mention Keynesian economics (even though the question is about 2001 - and supply-side policies are the 'in thing' now) and how expansionary fiscal & monetary policy could be used to influence agg. demand for consumer goods.
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    (Original post by TheWolf)
    to show economic growth use ppf shifting outwards, or business cycle with postive output gap, or keynesian outward lras shift
    Positive output gap means current growth is greater than ternd rate growth, it doesn't actually mean in increase in tred growth - it's defenition depends on the distinction between SRAS and LRAS. But the other two are right. :cool:
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    If you were drawing a diagram for the NHS, would you show supply to be perfectly inelastic?
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    (Original post by Ellie4)
    If you were drawing a diagram for the NHS, would you show supply to be perfectly inelastic?
    depends on supplying what and who they are supplied to
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    (Original post by TheWolf)
    depends on supplying what and who they are supplied to
    Healthcare, and to the UK public!
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    (Original post by mik1a)
    Yeah.

    Corey, what do you mean by "Durable goods are likely to come from abroad, and we have not seen a recovery of the manufactoring sector - again indicating that the growth is coming from outside imports to the UK"...

    surely consumer spending is only for domestic goods, and imported goods by consumers are under the imports section? Or does the questions mean everything consumers buy?
    Strange...i'd written that point down on my 'perfect essay plan' after the whole class failed the question... *checks mark scheme*

    I'm not sure the question is ambigious as it lists it as 'total consumption' and also mentions 'vechiles' in the passage (which mainly come from abroad).
 
 
 
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