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AQA A-level Economics new 7136 - 06, 13 & 19 Jun 2017 [Exam Discussion] Watch

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    (Original post by Gemmamcconville)
    Can some help me please. So if financial markets came up, I understand micro for example market failures and gov failures, but when speaking about macro would it be right to talk about credit crunch and systemic risk as in if we have a meltdown of financial system it will cause potential reccesion, fall in AD, fall in real GDP, Unemployment and potentially deflation? is there any other macro links to financial markets, not sure how to use monetary policy in the right context.
    For monetary policy you could discuss how QE has enabled the strengthening of bank balance sheets
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    (Original post by CricketMaster123)
    Didnt Aqa techincally give us a question on Financial Markets as Monetary Policy is a apart of that topic?
    (Original post by GTHargs)
    That was focussed on monetary policy not explicitly financial markets
    You could have discussed that post 2008, banks have strict liquidity and capital ratios so low interest rates aren't so useful because the banks aren't able and not so willing to lend in high quantities.
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    (Original post by GTHargs)
    Thats not setting economics aside, demographic factors are one of the governing dynamics of economics.
    (Original post by archie341)
    Ye I mean we don't explicitly cover population etc on the econ syllabus but was worth a mention so why not
    Mentioning thr ageing population was one of the best things you could have said in my opinion. The ageing population in Japan is one of the key reasons for their prolonged deflation. Monetary policy is likely to be ineffective in a place like Japan since such reflationary policy is unlikely to work due to the MPC of elderly people being far lower than younger people. Also, the fact that it wasn't mentioned in the extract shows good knowledge of Japan's economy - it's a superb evaluative point. I was surprised at how so many people discarded this factor in determining the effectiveness of interest rates because it's a huge factor, especially in Japan and increasingly in the developed world.
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    I don't know how to revise for synoptic, am I supposed to revise all of economics micro and macro AS and A2 ? I don't know if i have enough time to do that 😭
    My teacher believes the following topics are likely to come up:

    - labour markets: - productivity/poverty/inequality
    Micro: wage rates labour market failure
    Macro: SRAS&LRAS position and costs, unemployment and flexibility

    - financial markets/
    Micro - analysis of different markets (bonds types of banks and objectives) Macro - monetary policy, operation of the central bank and financial regulation

    - behavioural economics
    Micro - decision making, factors influencing D&S
    macro - nudges for fiscal policy, supply side etc

    - technological issues & competition policy - factors influencing market structure/ costs/ external economies of scale
    Factors affecting LRAS

    - externalities :
    Micro - types of market failure
    Macro - disadvantages of growth and international trade

    - developing economics: - micro - commodity market inequality health and education , macro: policies and trade


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    I will keel over and die if I see financial markets anywhere in paper 3
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    (Original post by cathartic)
    I don't know how to revise for synoptic, am I supposed to revise all of economics micro and macro AS and A2 ? I don't know if i have enough time to do that 😭
    My teacher believes the following topics are likely to come up:

    - labour markets: - productivity/poverty/inequality
    Micro: wage rates labour market failure
    Macro: SRAS&LRAS position and costs, unemployment and flexibility

    - financial markets/
    Micro - analysis of different markets (bonds types of banks and objectives) Macro - monetary policy, operation of the central bank and financial regulation

    - behavioural economics
    Micro - decision making, factors influencing D&S
    macro - nudges for fiscal policy, supply side etc

    - technological issues & competition policy - factors influencing market structure/ costs/ external economies of scale
    Factors affecting LRAS

    - externalities :
    Micro - types of market failure
    Macro - disadvantages of growth and international trade

    - developing economics: - micro - commodity market inequality health and education , macro: policies and trade


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    There was an essay question on poverty in paper 1, so I don't think it's likely that it would come up again?
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    Can someone explain marginal propensity to consume?
    How do you work it out?
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    (Original post by BintM)
    Can someone explain marginal propensity to consume?
    How do you work it out?
    Δin spending/ΔIn income
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    (Original post by citibankrec)
    Δin spending/ΔIn income
    In specimen paper one, how do they work out Q19?
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    (Original post by BintM)
    In specimen paper one, how do they work out Q19?
    To find the initial injection, you first need to calculate the multiplier
    The calculation needed to find the multiplier is : 1/1-MPC

    So in this example, because the MPC is 0.8, the multiplier would be 1/1-0.8 which is equal to 5, meaning the multiplier is 5. Given that the total increase is £350 million, to find the original you would need to divide it by 5 because the multiplier is a increase in national income following an increase in a component of demand.

    Initial Injection x Multiplier = Final National Income

    £350/5 = £70 million
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    Name:  IMG_1555.PNG
Views: 23
Size:  102.1 KB How would you do 14?
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    Also how would you do 27?Name:  IMG_1556.PNG
Views: 25
Size:  121.4 KB
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    Need explanations on these multiple choice Q's please: http://prntscr.com/fl0512 http://prntscr.com/fl0512 http://prntscr.com/fl06s6 http://prntscr.com/fl075j
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    (Original post by SWISH99)
    Also how would you do 27?Name:  IMG_1556.PNG
Views: 25
Size:  121.4 KB
    bump, for 27 i got 11.11% which is obviously wrong
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    (Original post by nellythumper)
    bump, for 27 i got 11.11% which is obviously wrong
    the answer is 10% and it says "approximately" so you be right. How did you do it?
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    (Original post by Conquest.)
    Need explanations on these multiple choice Q's please: http://prntscr.com/fl0512 http://prntscr.com/fl0512 http://prntscr.com/fl06s6 http://prntscr.com/fl075j
    I'll do the ones which I can explain
    25 is B bond prices and interest rates have an inverse relationship as interest rates increase bond price will fall, interest rates are also the yield you get on something (I think I'm correct in saying this) so if interest rates increase yields will increase too
    26 is D, a firm will operate in the short run as long as it's covering its average variable cost, in the diagram p=avc this leaves us with A or D however as the firm is making a loss (earning less then normal profit) as p <ac the firm cannot operate in the long run
    10 is A because good x social cost = 290, social benefit = 250 msc>msb = negative externality you're likely to tax it for good y msb>msc = positive externality you're going to subsidise it. Hope this helps
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    (Original post by SWISH99)
    the answer is 10% and it says "approximately" so you be right. How did you do it?
    Well, the way I did it was to work out real GDP per capita in 2005 which was obviously 100/100=1. Then work out real GDP per capita in 2014, real GDP was (200/150)*100 which gave you 400/3. Then divide 400/3 by the population of 120 to get 400/360 which was 1.1111... (recurring). So now its just a percentage change of (1.11111...-1)/1 then *100 to get a percentage and this came out to 11.1111...%. But I would have thought the answer would be exactly 10% if that was one of the options.
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    Anybody have the mark scheme for the spec paper 3 that isn't online?
    I have the paper but not the mark scheme.
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    Well i got 18/30 in the MCQ, and just like that POOF, A* gone
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    (Original post by FTSE420)
    You could have discussed that post 2008, banks have strict liquidity and capital ratios so low interest rates aren't so useful because the banks aren't able and not so willing to lend in high quantities.
    Banks in the UK are restricted by a liquidity ratio, none yet exist.

    However, there is the 8% Basel III capital ratio.
 
 
 
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