Sunday, June 29, 2008

Unit 3: The impact of US fiscal policy on economic growth

An interesting article from the BBC showing the effect of the recent tax rebates in the USA on economic growth

a) What was the fiscal boost the American government gave the economy?
b) Using an AD/AS diagram and the AD formula, explain how this has lead to the increased economic growth
c) Explain why the rise in economic growth has not been as high as some economists predicted

Unit1: Elasticity of supply: Scotch whisky

This Times article suggests the supply of whisky is running out in the face of rising demand

a) Why is supply likely to be inelastic according to the article?
b) Using a S&D diagram, show the effect on consumers of a rise in the world demand for scotch whisky

Thursday, June 26, 2008

Unit 2: The benefits of international trade: China

This BBC video outlines the benefits to the UK of international trade

a) What are the benefits to the UK of international trade with China?
b) Why might China's inflation rate be rising?
c) What effects could that inflation have on the UK

Unit 1: More fines for collusion in the air freight industry

The BBC reports more fines for collusion in the air freight industry

a) How would you describe the air freight industry in terms of market structure?
b) What was the economic motivation for the firms to collude?
c) To what extent do you think such fines will deter future collusion?

Unit 2: Positive externalities from developing Inverness harbour

The BBC reports that the redevelopment of Inverness Harbour is almost complete

a) What private costs are associated with the development?
b) What private benefits would there be associated with the development?
c) What external benefits result from the development?
d) Would there be any external costs resulting from the project? If so, what would they be?

Wednesday, June 25, 2008

Unit 2: Carbon taxes to reduce negative externalities

From the BBC comes this opinion piece on why we need carbon taxes to reduce global warming and the associated externalities

a) Why is it argud we need carbon taxes?
b) To what extent do you believe the proposed $1 per tonne tax would be successful?

Tuesday, June 24, 2008

Unit 2: Inequality and poverty: Tax credits to overcome poverty

From CH4 comes this excellent video about poverty in the UK

Unit 1: Price elasticity of demand for air travel

The BBC reports that BA is introducing different fuel surcharges for different classes of passengers

a) Explain how the concept of PED may have influenced the decision to introduce different fuel surcharges for different classes of passengers

Sunday, June 22, 2008

Unit 3: Protectionism in the US steel pipe industry

The BBC reports the USA will impose tariffs on Chinese imports of steel pipes

a) Why is the USA imposing the tariffs?
b) What effect will this have on US consumers of steel pipes?
c) What will determine whether the tariff will be sucessful or not?

Unit 3: Theffects of inflation on disposable income and savings

A good article from Geoff Riley on the effects of inflation on individuals

Tuesday, June 17, 2008

Unit 3: Problems with measuring inflation

This BBC article highlights problems associated with compiling a single figure for the UK inflation rate

a) Outline the problems identified in the article
b) Given the problems, why compile an inflation index?

Unit 2: Information failure: Alcohol consumption

The BBC has the latest government initiative to reduce youngsters excessive alcohol consumption

a) To what extent do you believe such public information films reduce market failure?
b) Suggest 2 reasons why the government is keen to reduce the market failure

Unit 3: UK inflation outside target range at 3.3%

This BBC article and video reports CPI inflation now outside the target range article video

These CH4 video clips go in to more detail

a) What is the target for CPI inflation?
b) What sort of inflation is the UK suffering?
c) Why do people appear to think inflation is much higher than the official rate?
d) Explain to them why their perceptions may be wrong and the offial rate may be correct
e) CH4 video: Why does the economist say higher interest rates are the only way of reducing inflation?
f) What conflicting macroeconomic objectives does the government face

Sunday, June 15, 2008

Unit 2: Further government action to reduce the market failure associated with excessive alcohol consumption by youngsters

The BBC reports likely proposals by the Scottish government to reduce excessive alcohol consumption by youngsters

and here are the actual proposals

a) How does the free market fail in this instance?
b) Outline the arguments for and against this extension of legislation to reduce the market failure
c) Discuss the likeyhood of such a policy reducing the market failure

Unit 2: Carbon trading: How it works and associated problems

A brilliant radio programme from the BBC World Service One Planet series

a) How would an ideal carbon trading system work?
b) What problems have been encountered with the systems tried so far?

Saturday, June 14, 2008

Unit 2: Allocative efficiency: Pay as you go car insurance

The BBC reports that NU is abandoning its PAYG car insurance for young drivers

a) How does this decision reflect the economy becoming more allocatively efficient?

Friday, June 13, 2008

Unit 1: The price of corn

The BBC reports the price of corn is rising

a) Using a S&D diagram, explain why the price of corn is rising

Unit 3: Rising unemployment figures

The latest figures show unemployment in the UK on an upward trend

Unit 1: Demand for bottled water

The BBC reports rising demand for bottled water

a) Use demand theory to explain the increase in demand
b) Show on a diagram the effect of rising demand

Unit 2: Government action to overcome market failure: Sunbeds and under 18's

The BBC reports that uner 18's are to be banned from using commercial sunbeds

a) How is the free market in sunbeds failing?
b) What does the article suggest is the cause of the market failure?
c) Why is the government stepping in and introducing legislation?
d) What punishments will the government impose?
To what extent do you believe such a policy will reduce the market failure regarding under 18's consumption of sunbeds?

Unit 2: Costs and benefits associated with the Severn barrage

This BBC clip and associated article highlights the 2 sides of the argument regarding the proposed Severn barrage project video article

a) Explain a private cost asociated with the barrage
b) Explain a private benefit asociated with the barrage
c) Explain an external cost asociated with the barrage
d) Explain an external benefit asociated with the barrage
e) Environmentalists suggest wind generation as an alternative: Explain how cost benefit analysis could be used to decide which project(s) the government should fund

Economies of scale: Greenhouses in Kent

From the BBC, a wonderful video showing a great example of economies of scale in action

a) Explain what economies of scale are
b) Explain what sort of economies of scale will result from growing tomatoes on this scale

Tuesday, June 10, 2008

Unit 1: Pricing in car parks

The BBC reports an innovative approach to pricing in a LOndon car park

a) Using a S&D diagram, explain how these different prices would be determined

Saturday, June 07, 2008

Unit 3: The link between falling aggregate demand and rising unemployment

This BBC article reports that as the housing market slows the numbers unemployed will rise

a) Explain why unemployment is likely to rise as the economy slows
b) Will this be true for all industries?

Unit 2: Efficiency; restructuring in the insurance industry

Two articles from the BBC seem to indicate that competition in the insurance industry is causing firms to seek greater economic efficiency

a) What type of efficiency will these job losses lead to?
b) Why are the 2 firms following this course of action?

Unit 1: Cross elasicity of demand: 4x4's

This BBC clip explains the change in car buying by UK car buyers in response to rising fuel prices

This Ch4 clip shows the effect on Hummer sales

a) Explain how the concept of cross elasticity of demand can be used to explain the changing demand for (i) 4x4's such as the Hummer and (ii) smaller fuel efficient cars

Wednesday, June 04, 2008

Unit 1: The 2p sausage!

The BBC reports ASDA selling sausages for 2p each

a) What is the economics behind ASDA selling sausages for 16p a pack?
b) As ASDA are launching this line as the economy goes into an economic downturn, what sort of good does this suggest 2p sausages are?
c) Use economic analysis to explain what sort of sauasages in ASDA might see a decline in sales due to the economic downturn and the launch of the 16p pack

Unit 3: Protectionism: Korean beef import restrictions

From the BBC comes this interesting video on why Korea resticts USA beef imports

a) What sort of protectionist measure is Korea using?
b) Why are they imposing this measure?
c) Who in Korea and the USA benefits and suffers from this protectionism?

Unit 2: Using Cost Benefit Analysis in economics

From Geoff Riley at tutor2u comes this great article on how CBA can be used in economics

Monday, June 02, 2008

Unit 2 Government intervention revision article

From tutor2u comes this good revision guide on how govt's intervene when markets fail and some points to consider when evaluating the success of such policies

Sunday, June 01, 2008

Unit 1: The supply of milk

A good article from the Times which helps explain the upward sloping supply curve

a) Define supply
b) What does the article say is happening to the supply of milk as the price of milk for farmers falls?
c) Using the definition, explain how can this be the case as cows don't stop producing milk if the price the farmer gets falls!