Unit 3: Inflation: Some common Q&A's

This BBC article is good at explaining the difference between the RPI and the CPI, and other common questions regarding inflation

http://news.bbc.co.uk/1/hi/business/6356475.stm

Unit 3: Measuring inflation; what goes in the CPI's basket of goods

The annual changes to what is included in the basket of goods on which the CPI is calculated have been announced and can be found in these 2 articles

http://news.bbc.co.uk/1/hi/business/6466083.stm

http://news.bbc.co.uk/1/hi/business/6466083.stm

a) Why do these changes in the basket of goods occur annually?
b) Why, despite these annual changes, is the basket of goods (and the weights used) already out of date?

Unit 3: Supply side policies: Welfare reform

The government wishes to get more people off long term benefits and back in to work according to this BBC article and video clip

http://news.bbc.co.uk/1/hi/uk_politics/6418305.stm
< http://www.bbc.co.uk/mediaselector/check/player/nol/newsid_6410000/newsid_6416600?redirect=6416647.stm&news=1&nbwm=1&nbram=1&bbwm=1&bbram=1 >

a) List all the supply side measures proposed
b) How likely are such measures to reduce the numbers on long term benefits?

Unit 2: Government information to overcome the problem of de-merit goods

This BBC clip explains the latest government public information campaign on passive smoking
< http://www.bbc.co.uk/mediaselector/check/player/nol/newsid_6410000/newsid_6414400?redirect=6414479.stm&news=1&bbwm=1&bbram=1&nbwm=1&nbram=1 >

a) What aspect of market failure is the government trying to combat?
b) Draw a diagram to show the effect if this campaign is successful
c) To what extent do you believe the campaign will be successful?