Draft Unit 3: Exchange rates: The effect of the rising value of the £

** Brits shop in US as dollar dips **
British shoppers are flocking to the US to take advantage of the best exchange rate against the dollar since 1981.
< http://www.bbc.co.uk/mediaselector/check/player/nol/newsid_7070000/newsid_7073900?redirect=7073939.stm&news=1&bbwm=1&nbram=1&nbwm=1&bbram=1&asb=1 >


** New York tourist boost **
The weak US dollar is attracting high-spending foreign tourists and prompting a boost to the city's economy.
< http://www.bbc.co.uk/mediaselector/check/player/nol/newsid_7070000/newsid_7074600?redirect=7074631.stm&news=1&bbram=1&nbwm=1&nbram=1&bbwm=1&asb=1 >

Unit 3: Supply side policy; the school leaving age

The government has announced plans to increase the school leaving age in England to 18

http://news.bbc.co.uk/1/hi/education/7080699.stm

a) Explain what is meant by supply side policies
b) What does the government hope to achieve by raising the schoolleaving age?

Unit 1: The rise in the price of pizza

These 2 articles from the BBC and the Guardian explain the recent rise in the price of pizzas. Domino's says the price of pizzas looks set to rise after "unprecedented" increases in the cost of cheese and flour ingredients

http://news.bbc.co.uk/1/hi/business/7072970.stm

http://business.guardian.co.uk/story/0,,2203878,00.html

Unit 1: Elasticity of supply

From Geoff Riley's blog comes this illustrating the inelastic nature of supply for 2 products

http://www.tutor2u.net/newsmanager/templates/?a=2685&z=1

a) In each case explain why supply is inelastic

Draft Unit 2: Market dominance and the Competition Commission: Supermarkets and their suppliers

http://news.bbc.co.uk/1/hi/business/7070488.stm


** More supermarkets called for **
The Competition Commission has called for the planning system to be changed so there can be more supermarkets.
< http://www.bbc.co.uk/mediaselector/check/player/nol/newsid_7070000/newsid_7070500?redirect=7070555.stm&news=1&nbwm=1&bbram=1&bbwm=1&nbram=1&asb=1 >


** Fears of superstore takeover **
Some supermarkets may be forced to sell off land to prevent them monopolising the market.
< http://www.bbc.co.uk/mediaselector/check/player/nol/newsid_7070000/newsid_7071300?redirect=7071306.stm&news=1&bbram=1&nbwm=1&nbram=1&bbwm=1&asb=1 >

Unit 3: Rising exchange rates

http://news.bbc.co.uk/1/hi/business/7069087.stm

Unit 2: Pay as you throw

This BBC article oulines the government plans to introduce trials of taxation on rubbish

http://news.bbc.co.uk/1/hi/uk_politics/7067971.stm

a) How is rubbish disposal an example of market failure?
b) Using a diagram, expain how will this plan reduce the market failure

The London mayor Ken Livingstone is scathing in his critisism of the plan

http://news.bbc.co.uk/1/hi/education/7080699.stm

c) Why does he not think the plan will work

Unit 2: Negative externalities associated with roadworks

Shopkeepers in a village in Wales are complaining that roadworks are cutting their trade by up to half according to this BBC report:
< http://www.bbc.co.uk/mediaselector/check/player/nol/newsid_7060000/newsid_7064000?redirect=7064074.stm&news=1&nbwm=1&bbwm=1&nbram=1&bbram=1 >

a) Explain what is meant by a negative externality
b) Why are the drop in shopkeepers takings are a clear example of negative externalities?
c) How might these negative externalities have been reduced according to the report?

Unit 2: Market failure and vaccination

The Department of Health has announced more girls are to be vaccinated against cervical cancer virus HPV according to this BBC clip and article.
< http://www.bbc.co.uk/mediaselector/check/player/nol/newsid_7060000/newsid_7063100?redirect=7063190.stm&news=1&nbwm=1&bbram=1&bbwm=1&nbram=1&asb=1 >

http://news.bbc.co.uk/1/hi/health/7062479.stm

a) Which type of market failure does this current low level of vaccination represent?
b) Using a diagram explain how the market for vaccination currently fail fails
c) Explain the measures the government is taking to overcome the market failure
d) To what extent do you believe these government actions will overcome the market failure

Unit 2: Taxation as a way to reduce market failure: Rubbish collection

The BBC reports the government is having second thought about it's idea to tax those whofail to recycle rubbish

http://news.bbc.co.uk/1/hi/uk_politics/7060607.stm

a) What market failure is this taxation meant to reduce?
b) Using a diagram, explain how the tax would reduce the market failure
c) If the tax was introduced, discuss the extent to which you believe it would be successful

Unit 2: Inequality as a market failure

The idea that the market fails due to the unequal distribution of income and wealth is a contentious issue. This BBC article shows why maybe it should be taken more seriosly

http://news.bbc.co.uk/1/hi/health/7059693.stm

Unit 2: Market failure: Obesity

The following BBC article about weighing schoolchildren and the clip on free school meals in Scotland show the government response to the free market failing due to childhood obesity

http://news.bbc.co.uk/1/hi/uk/7055735.stm
< http://www.bbc.co.uk/mediaselector/check/player/nol/newsid_7050000/newsid_7055700?redirect=7055785.stm&news=1&nbwm=1&bbwm=1&bbram=1&nbram=1&asb=1 >

a) Why, in economic terms (ie in terms of costs and benefits) does the government worry if children become osese?
b) What form of intervention do these 2 schemes represent?
c) Discuss the extent to which either scheme is likely to be successful in reducing the market failure

Unit 1: Market share ; the games console market

This BBC article outlines the current state of the games concole market

http://news.bbc.co.uk/1/hi/business/7055937.stm

a) Using the information provided in the article, discuss to what extent the games console market reflects any market structure model

Unit 2: Alcohol consumption; Market failure and legislation

Doctors are calling for the compulsory labelling of alcoholic drinks to help stop binge drinking according to this BBC clip and article
< http://www.bbc.co.uk/mediaselector/check/player/nol/newsid_7050000/newsid_7054600?redirect=7054680.stm&news=1&bbwm=1&nbram=1&nbwm=1&bbram=1 >

http://news.bbc.co.uk/1/hi/scotland/7053037.stm

a) What type of market failure is binge drinking?
b) How does the market fail?
c) What action is proposed in the articles to reduce the market failure?
d) What other actions could the government take?
e) Discuss the extent to which the proposed policy would reduce the market failure

Unit 1: The price of diesel: Rising costs mean rising prices

This BBC article clearly shows the link between rising costs of production and rising prices for consumers

http://news.bbc.co.uk/1/hi/business/7052504.stm

a) Using a S&D diagram, explain why the price of diesel has risen to above £1 a litre. Think what the demand curve will look like before you draw the diagram.

Unit 2: Information failure; salt in fast food

This BBC clip and associated article looks at a new report which shows frighteningly high levels of salt in fast food, especially Pizza Hut pizza. The report shows some fast food may contain more than a whole day's recommended salt intake.
< http://www.bbc.co.uk/mediaselector/check/player/nol/newsid_7050000/newsid_7052100?redirect=7052102.stm&news=1&nbwm=1&bbwm=1&bbram=1&nbram=1&asb=1 >

http://news.bbc.co.uk/1/hi/health/7050585.stm

a) Explain what example of market failure this represents
b) What are the private benefits of pizza consumption?
c) What are the private costs of pizza consumption?
d) Using a diagram, explain how the market fails
e) Explain 2 different methods the government could use and explain how they would reduce the market failure
f) Comment on how likely these interventions by the government are to overcome the market failure

Unit 1: Increasing costs and the effect on prices

Two French food companies are raising the cost of their dairy products because of high milk prices according to this BBC clip
< http://www.bbc.co.uk/mediaselector/check/player/nol/newsid_7040000/newsid_7041000?redirect=7041029.stm&news=1&bbwm=1&nbram=1&nbwm=1&bbram=1&asb=1 >

a) Using a S&D diagram, explain how an increase in the price of milk leads to an increase in the price of dairy products in the shops

Unit 1: The effect on demand of England's success at the rugby world cup

A good Guardian article explaining how a variety of products have seen demand increase as England have progressed in the world cup

http://business.guardian.co.uk/story/0,,2193215,00.html

a) What economic reasons can you use to explain the increase in demand for any particular product?

Unit 1: The demand for Coca Cola

Coke have announced mixed results for the last 3 months trading reflecting changing demand for their product

http://business.guardian.co.uk/story/0,,2193169,00.html

a) Identify the regions that have seen an increase in demand for Coke and use economic theory to explain why demand has increased
b) Identify the regions that have seen a decrease in demand for Coke and use economic theory to explain why demand has decreased
c) Draw a diagram to show the overall effect on demand

Unit 1: The price of oil and gold

This Guardian article states that the price of both oil and gold have risen recently

http://business.guardian.co.uk/story/0,,2189353,00.html

a) Using a diagram in each case, explain why the price has risen

Unit 2: External costs of dam building

The Chinese government announce mass population movement due to the effect of the 3 gorges dam

http://www.guardian.co.uk/china/story/0,,2190332,00.html

a) Why is this a great example of an external cost of building dams?

Unit 2: The external costs of obesity

This BBC article portrays a frightening future for the health of the UK population

http://news.bbc.co.uk/1/hi/uk/7043639.stm

a) Explain what is meant by an external cost
b) Explain the external costs associated with obesity
c) What is the market failure associated with obesity?
d) What actions have the government already taken to combat this market failure?
e) What actions are the government proposing to further combat this market failure?
f) Evaluate the likely success of the government's actions

Unit 1: Radiohead's album: A case of no consumer surplus?

This BBC article explains how radiohead are charging for their latest album as a download

http://news.bbc.co.uk/1/hi/entertainment/7037194.stm

a) Explain the concept of consumer surplus
b) Explain the method Radiohead are using to price their album
c) Comment on whether this means there is no consumer surlus in this market

Unit 1: The price of petrol: Increase in taxation

This BBC clip explains that the price of fuel is going up

http://news.bbc.co.uk/player/nol/newsid_7020000/newsid_7021300/7021381.stm?bw=bb&mp=rm&asb=1&news=1

a) Using a S&D diagram, explain why the price of fuel will rise
b) Using a S&D diagram, explain why the price of goods in the shops will rise
c) To what extent can car travel and public transport be regarded as substitutes?

Unit 2: Demerit goods and government action: Raising the age you can buy cigarettes

On the 1st Oct 2007, it became illegal to sell tobacco products to under 18's. This BBC clip and article both explain why the government has taken this action
< http://www.bbc.co.uk/mediaselector/check/player/nol/newsid_7020000/newsid_7021300?redirect=7021376.stm&news=1&nbram=1&bbram=1&bbwm=1&nbwm=1&asb=1 >

http://news.bbc.co.uk/1/hi/uk/7021320.stm

a) Why are cigarettes a demerit good?
b) What type of actions does the government take to overcome the market failure associated with cigarette smoking
c) To what extent do you believe this latest initiative will overcome the market failure?

Unit 1: The effect of the weather on demand: Cinema sales

This BBC article suggests the abysmal summer weather has boosted demand for cinema seats

http://business.guardian.co.uk/story/0,,2178043,00.html

a) Draw a diagram to show the effect on demand of the poor weather on the cinema seat market
b) Use demand theory to explain other reasons why the demand for cinema seats may have increased (one factor is mentioned in the article).

Unit 2: CBA and producing power on the Severn

This BBC article says the Government is going to re-examine the possibility of producing 5% of the UK's energy needs from the Severn tidal surge

http://news.bbc.co.uk/1/hi/sci/tech/7013068.stm

The actual report is summarised by the Guardian

http://www.guardian.co.uk/environment/2007/oct/02/renewableenergy

a) Explain how a CBA could be used to decide which, if either, of the 2 proposals should be put in place
b) Comment on how dependable the result of the CBA would be to decision makers
c) What else would decision makers take in to accout as well as the results of the CBA?

Unit 2: Costs and benefits associated with 3 gorges dam dam

This BBC article outlines clearly the costs and benefits to China of building the massive 3 gorges dam

http://news.bbc.co.uk/1/hi/world/asia-pacific/7013953.stm

a) Outline the private costs of building the dam
b) Outline the private benefits of building the dam
c) Outline the external costs of building the dam
d) Outline the external benefits of building the dam
e) Assuming a CBA had been conducted on the proposed dam before the start of the project, what other factors might the government have taken into consideration

Unit 2: Negative externalities: More on lightbulbs

The BBC reports that the UK is to follow Australia (see blog for 21st Feb 2007) in phasing out traditional lightbulbs

http://news.bbc.co.uk/1/hi/uk/7016020.stm

a) What is the main difference between the Uk and Australian proposals?
b) Comment on which approach is most likely to succeed in reducing the negative externalities quickest.

Unit 2: Market dominance in the milk market

This BBC clip explains the allegations that there has been price fixing in the milk market

http://news.bbc.co.uk/player/nol/newsid_7000000/newsid_7004100/7004112.stm?bw=bb&mp=rm&asb=1&news=1

a) Who are alleged to have colluded in this price fixing?
b) In what way is this an example of market failure?
c) How does the government intervene to protect the consumer?
d) What penalties do the firms face if the allegations are proved?

Unit 1: Demand for diamonds

China is the world's second fastest growing diamond market according to this BBC videoclip

< http://www.bbc.co.uk/mediaselector/check/player/nol/newsid_7000000/newsid_7004100?redirect=7004190.stm&news=1&bbram=1&nbwm=1&nbram=1&bbwm=1&asb=1 >

a) Use demand theory to explain this increase
b) Draw a diagram to show the effect on the demand for diamonds

Unit 1: Opprtunity cost and production possibility curves: Cornish waves

This Guardian article oulines the choices faced by the community off the Cornish coast

http://www.guardian.co.uk/uk_news/story/0,,2171301,00.html

a) What are the 2 things the article says the sea can produce for Cornwall?
b) Draw a PPC to show the possible outputs of the two
c) Show the current position on the PPC
d) Show the position if the wave farm is built

Unit 2: Climate change as market failure and potential policies to overcome the market failure

This Guardian article outlines the Tories plans to counter climate change

http://www.guardian.co.uk/guardianpolitics/story/0,,2168986,00.html

a) What 3 general actions can the government take to overcome market failure?
b) List the policies under the 3 headings
c) Take any one section and evaluate the likelyhood of the policies succeeding

Unit 1: The price of barley and whisky

The price of barley has fisen steeply according to this BBC article

http://news.bbc.co.uk/1/hi/scotland/highlands_and_islands/6987208.stm

a) Using a diagram, explain why the cost of barley has risen
b) Using a diagram, explain the likely effect of this price rise on the price of whisky

Unit I: The market for champagne

Vineyards in the Champagne region of France are struggling to keep up with global demand for their product according to this article from the BBC.
< http://www.bbc.co.uk/mediaselector/check/player/nol/newsid_6990000/newsid_6992000?redirect=6992068.stm&news=1&nbram=1&bbwm=1&bbram=1&nbwm=1&asb=1 >

a) Use economic theory to explain why demand for champagne has risen so much
b) Use economic theory to explain why the supply of champagne will not be able to rise much further
c) If the situation continues, use a S&D diagram to explain what is likely to happen to the price of champagne
d) What solution to this problem is suggested?
e) Use a S&D diagram to explain how this would alter the champagne market and comment on the likely effect on its price

Unit 1: Increasing the supply of arable land and the effect on the price of wheat

This BBC article outlines the EU proposals to do away with set aside land, at least for one year

http://news.bbc.co.uk/1/hi/business/6993635.stm

a) What will be the effect on the supply of agricultural land?
b) What will be the effect on the supply wheat?
c) Draw a S&D diagram and explain the effect of this policy on the world price of wheat
d) What possible drawbacks are there to this policy?

Unit 3: Unemployment and the AS curve

This BBC article states that UK unemployment continues to fall

http://news.bbc.co.uk/1/hi/business/6990785.stm

a) Why do wages rise as the level of unemployment falls?
b) Draw an AS curve and use it to explain the effect of the fall in unemployment

Unit 1: The price of wheat

A great article from the BBC explaining why the price of wheat has reached an all time high

http://news.bbc.co.uk/1/hi/business/6990821.stm

a) Explain what has happened to the demand for wheat using economic reasons
b) Explain what has happened to the supply of wheat using economic reasons
c) Draw a S&D diagram to show the effect of these changes and explain the effects of these changes on the price of wheat

Unit 2: Alcohol consumption; taxation and promotion bans

The British Medical Association says that increasing tax on alcohol would help tackle binge drinking, acccording to this BBC clip
< http://www.bbc.co.uk/mediaselector/check/player/nol/newsid_6980000/newsid_6985700?redirect=6985769.stm&news=1&nbwm=1&bbram=1&nbram=1&bbwm=1&asb=1 >

a) What are the negative externalities associated with excessive alcohol consumtion?
b) What are the private costs associated with excessive alcohol consumtion?
c) What 2 suggestions do the BMA propose to cut alcohol consumption?
d) Evaluate the likelyhood that these policies would be successful if implemented

Unit 2: Costs and benefits associated with dam building: Turkey

This excellent BBC clip outlines the costs and benefits of building a new dam on the Tigres river in South-Eastern Turkey. Protests have taken place over the plans to build a huge dam that will flood an ancient city.
< http://www.bbc.co.uk/mediaselector/check/player/nol/newsid_6980000/newsid_6983200?redirect=6983243.stm&news=1&nbram=1&nbwm=1&bbwm=1&bbram=1&asb=1 >

a) Outline the private costs associated with the project
a) Outline the private benefits associated with the project
a) Outline the external costs associated with the project
a) Outline the external benefits associated with the project

Unit 1: Supply and Demand; the price of bread

The price of bread is due to rise due to the rise in the price of wheat according to this BBC article

http://news.bbc.co.uk/1/hi/business/6977360.stm

a) Using a S&D diagram, explain how this rise in the price of wheat will lead to a rise in the price of bread

Unit 1: Opportunity cost and production possibility curves: Maize

The Guardian has this great article explaining the effect on food supply (and so food prices) of the incresed use of maize grown in the USA for biofuels to power cars as a substitute for oil

http://www.guardian.co.uk/environment/2007/aug/29/food.g2

Unit 3: Tariffs: lightbulbs

This BBC article gives an example of a tariff inaction

http://news.bbc.co.uk/1/hi/business/6968809.stm

a) Why is the tariff imposed?
b) Draw a S&D diagram to show the effect of the tariff in the market
c) Discuss the positive and negative effects of the tarif on EU consumers, EU producers and overseas producers

Unit 2: Internalising externalities: Alcohol

This BBC article suggests that late night bars should pay for the policing in city centres

http://news.bbc.co.uk/1/hi/scotland/6968438.stm

a) What are the negative externalities associated with late night city centre drinking?
b) How would the proposal internalise the externality?
c) Draw a S&D diagram to show the effect on the market of internalising the externality and explain how it would reduce the market failure

Unit 1:The price of beef

British shoppers could pay more for meat because of the rising feed costs paid by farmers says this BBC clip.
< http://www.bbc.co.uk/mediaselector/check/player/nol/newsid_6960000/newsid_6966100?redirect=6966171.stm&news=1&bbwm=1&nbwm=1&nbram=1&bbram=1&asb=1 >

a) Does the rising cost of feed effect the demand for, or the supply of beef?
b) Draw a S&D diagram to show this change and the resulting increase in the price of beef

Unit 2: Overcoming information failure with demerit goods: Cigarettes

This BBC clip and related article shows the latest govt policy initiatives to deal with information failure in the cigarette market. Under new regulations all UK tobacco products will have to carry picture health warnings

< http://www.bbc.co.uk/mediaselector/check/player/nol/newsid_6960000/newsid_6968000?redirect=6968013.stm&news=1&amp;nbwm=1&bbram=1&nbram=1&bbwm=1&asb=1 >

http://news.bbc.co.uk/1/hi/health/6967160.stm

a) What aspect of a demerit good is this picture campaign trying to counter?
b) What other method does the clip say the government is introducing to reduce cigarette consumption?
c) To what extent do you think these and other measures will overcome the market failure associated with cigarette consumption

Unit 1: Supply and Demand; the price of wheat

This BBC article says the price of wheat has risen

http://news.bbc.co.uk/1/hi/business/6962211.stm

a) Identify the supply reasons for the price rise
b) Identify the demand reasons for the price rise
c) Draw a S&D diagram to show both of these changes and explain the effect on the price of wheat

Unit 3: Hyperinflation: Zimbabwe

The BBC reports that Zimbabwe's economy continues to deteriorate and its inflation rate reach a new high of 7600% p.a.

http://news.bbc.co.uk/1/hi/business/6959164.stm

a) What sort of problems does such a rate of inflation lead to in the economy?

Unit 2: Externalities associated with alcohol consumption

This BBC Wales article argues that overconsumption of alcohol is a growing problem

http://news.bbc.co.uk/1/hi/wales/6955616.stm

a) What are the negative externalities associated with excessive alcohol consumption?
b) Evaluate how successful the 4 point BMA proposals are likely to be in reducing the problem
c) Evaluate how successful the banning of drinking on the streets is likely to be in reducing the problem

Unit 1: Price Elasicity of Demand: Car parking charges in Cardiff

This BBC article reports a sharp rise in car parking charges in Cardiff

http://news.bbc.co.uk/1/hi/wales/south_east/6957302.stm

a) Why do you believe NCP has put up prices?
b) What is likely to happen to demand for spaces in the car parks?
c) Does NCP believe the the demand for these spaces to be elastic or inelastic?
d) Why do you believe this to be the case?
e) Based on your answer to c), draw a diagram to show the effect on NCP's total revenue of this price rise

Unit 2: Internalising externalities: Rubbish collection

This BBC article seems to suggest households would be willing to pay for the rubbish they put out to be collected

http://news.bbc.co.uk/1/hi/uk/6957814.stm

a) What are the externalities associated with the production of household rubbish?
b) How would this scheme internalise the externalities?
c) Draw a S&D diagram to show the effect of this pay as you throw policy and explain the effect on the market
d) Evaluate how successful you believe such a scheme would be if implemented

Unit 1: Substitute goods: Telephones

This BBC article shows how demand for 2 substitute products has changed over time

http://news.bbc.co.uk/1/hi/business/6959049.stm

a) How close are landlines and mobiles as substitute products?
b) Why if they are substitutes do most people have both?

Unit 1: The demand for cigarettes

This Guardian article says the demand for cigarettes in the UK has dropped

http://business.guardian.co.uk/story/0,,2153163,00.html

a) Explain why is this the case using demand theory
b) Explain why, using economics ideas, why this fall in demand might be temporary

Unit 1: The price of chocolate

This Guardian article says the price of chocolate is set to rise

http://business.guardian.co.uk/story/0,,2153285,00.html

a) Why is the price set to rise?
b) Draw a S&D diagram to show how this price rise will occur and explain what your diagram shows

Unit 3: Inflation falls in the UK

July saw a surprise drop in UK inflation. THis BBC clip explains why the UK's rate of inflation fell below analysts' forecasts to 1.9% in July.
< http://www.bbc.co.uk/mediaselector/check/player/nol/newsid_6940000/newsid_6947000?redirect=6947089.stm&news=1&amp;bbram=1&bbwm=1&nbwm=1&nbram=1&asb=1 >

a) What are suggested as the reasons for the unexpected fall in inflation?
b) How do falls in the prices of these items lead to inflation (as measured by the CPI) decreasing?

Unit 1: Demand for Microsoft's Xbox

Microsoft intend to decrease the price of the Xbox in Europe following a similar decrease in the USA

http://news.bbc.co.uk/1/hi/business/6954718.stm

a) Why are Microsoft decreasing the price?
b) What view do you believe does Microsoft has regarding the Price elasticity of demand for the Xbox?
c) What is the economic link between the Xbox, the PS3 and the Wii?

Unit 2: Market dominance and the Competition Commission: Supermarkets and their suppliers

The CC announces it will investigate possible abuse by Tesco and Asda of their dominant market position in their dealings with their suppliers says this BBC clip and article

< http://www.bbc.co.uk/mediaselector/check/player/nol/newsid_6950000/newsid_6954400?redirect=6954485.stm&news=1&amp;nbram=1&nbwm=1&bbram=1&bbwm=1&asb=1 >

http://news.bbc.co.uk/1/hi/business/6953474.stm

a) What is the alleged abuse of market dominance that will be investigated?

Unit 2: Negative externalities: The ski resort with no snow

As global warming accelerates, low level ski resorts are feeling the consequences says this BBC clip

< http://www.bbc.co.uk/mediaselector/check/player/nol/newsid_6920000/newsid_6922700?redirect=6922777.stm&news=1&bbram=1&bbwm=1&nbram=1&nbwm=1&asb=1 >

a) Why is global warming a negative externality for this ski resort?

Unit 1: Demand for Polish products

The rise in the Polish population in the Uk has seen a rise inh demand for Polish products in the UK

This BBC clip shows how UK retailers have reacted to this change in demand
< http://www.bbc.co.uk/mediaselector/check/player/nol/newsid_6920000/newsid_6929800?redirect=6929868.stm&news=1&bbram=1&bbwm=1&nbram=1&nbwm=1&asb=1 >

Unit 2: Brocolli, a merit good!

This BBC article suggests that brocolli might be termed a merit good

http://news.bbc.co.uk/1/hi/health/6927359.stm

a) Why is brocolli a merit good?
b) What could the government do to increase consumption of brocolli?

Unit 2: Demerit goods: Patio heaters

This BBC article outlines the growth in the sales of outdoor patio heaters

http://news.bbc.co.uk/1/hi/uk/6914276.stm

a) Why could the heaters be considered as demerit goods?
b) What actions could governments take to attack both aspects of patio heaters being demerit goods?

Unit 2: Negative externalities associated with office printers

Working in an office may have external costs according to this BBC article

http://news.bbc.co.uk/1/hi/world/asia-pacific/6923915.stm

a) What are the external costs?
b) Why are they external costs?
c) What possible actions could governments take to reduce these negative externalities?

Unit 3: Economic growth, interest rates and inflation in China

This BBC article and video clip explain the conflicting macroeconomic objectives China appears to be facing

http://news.bbc.co.uk/1/hi/business/6915190.stm
< http://www.bbc.co.uk/mediaselector/check/player/nol/newsid_6900000/newsid_6907100?redirect=6907123.stm&news=1&nbram=1&bbram=1&bbwm=1&nbwm=1 >

a) What effect will the rising value of the Yuan have on China's exports and imports?
b) What effect should the rise in China's interst rates have on the value of the Yuan?

The economy is said to be overheating and as a result inflation is rising
c) Using an AD / AS diagram, explain the possible cause of this rise in inflation
d) What action should the cental bank take to reduce the rate of inflation?
e) Use an AD / AS diagram to show how this policy should reduce inflation

Unit 1: Demand for products at B&Q

This BBC article outlines reasons for sales at B&Q

http://news.bbc.co.uk/1/hi/business/6916876.stm

a) Explain the positive and negative effects the weather has had on B&Q sales
b) To what extent will increasing interest rates decrease demand for B&Q products?

Unit 1: Price elasticity of demand: Sony PS3

The effect of the price cut for the PS3 in the usa can now be seen

http://news.bbc.co.uk/1/hi/technology/6913090.stm

a) The original price was $600 and it was cut by $100. Using this information and the information in the story, calculate the PED for the last 2 weeks following the price cut.
b) Explai what happened to Sony's revenue from PS3 sales in these 2 weeks
c) Evaluate the success of Sony's stratagy given the other information in the article and your knowledge of the concept of PED

Unit 2: Consumption with private benefits but with external costs: Motorhomes

From Geoff Riley's blog comes this BBC video clip
< http://www.bbc.co.uk/mediaselector/check/player/nol/newsid_6900000/newsid_6900300?redirect=6900301.stm&news=1&bbram=1&bbwm=1&nbram=1&nbwm=1&asb=1 >

a) What do you think has lead to the increasing demand for motorhomes in the UK in the last 10 years?
b) What are the private benefits and private costs of having a motorhome?
c) If you buy a motorhome, what can you say about your valuation of the private costs and benefits associated woth ownership?
d) What external costs are there asociated with motorhomes?
e) Analyse how the government could internalise the external costs for motorhome owners and evaluate how successful they would be in reducing the number of motorhomes on the road.

Unit 1: Price elasticity of demand: Car parking

The BBC reports rising car parking prices at some hospitals

http://news.bbc.co.uk/1/hi/england/nottinghamshire/6910692.stm

a) What do the hospitals believe demand for car parking to be?
b) What PED factors explain this?
c) What do you expect to happen to the revenue received from car parking by the hospital?
d) Draw a diagram to show this revenue change

Unit 2: Government intervention to overcome market failure: Raising the age for smoking

A BBC article explaining what the government intends to do to inform people about the forthcoming increase in the minimum age for legal smoking

http://news.bbc.co.uk/1/hi/health/6908966.stm

a) What type of free market failure is present in teenage smoking?
b) What measures are the government taking to try to reduce the market failure?
c) Why are they taking these measures?
d) To what extent do you believe they will be successful in reducing the market failure

Unit 2: Government intervention to overcome market failure : Air safety

The BBC reports an Iranian airline banned from flying in to the UK

http://news.bbc.co.uk/1/hi/business/6910585.stm

a) In what way is the free market failing?
b) Why has the government intervened in the free market?

Unit 1: Increasing demand for Domino's Pizza

A great, short BBC article packed with economics

http://news.bbc.co.uk/1/hi/business/6911516.stm

a) Explain all the factors mentioned in the article that have led to an increase in demand for Domino's pizza, making sure you tie in the factors clearly to the theory of demand

Unit 2: Alcohol consumption; Market failure and taxation

The Chief Medical Officer believes alcohol should be taxed more heavily

http://news.bbc.co.uk/1/hi/health/6909683.stm

a) In what way does the free market fail?
b) To what extent do you believe increasing tax on alcohol would overcome this market failure?

Unit 1: The price of bread

This BBC video clip and associated article says the price of bread is due to rise in the autumn
< http://www.bbc.co.uk/mediaselector/check/player/nol/newsid_6900000/newsid_6908500?redirect=6908523.stm&news=1&nbram=1&nbwm=1&bbwm=1&bbram=1 >

http://news.bbc.co.uk/1/hi/uk/6909469.stm

a) Use both supply and demand reasons to explain why the price of bread will rise
b) Draw a S&D diagram to show the S and D changes and the resulting price rise

Unit 2: The rising inequality of income and wealth in the UK

The gap between rich and poor is at its highest level for 40 years, according to research by the Joseph Rowntree Foundation. This BBC clip explains the problem
< http://www.bbc.co.uk/mediaselector/check/player/nol/newsid_6900000/newsid_6902700?redirect=6902737.stm&news=1&bbram=1&nbwm=1&bbwm=1&nbram=1 >

The main conclusions of the report are

1. Deep poverty has declined: Over the last 15 years, more households have become poor, but fewer are very poor.

2. Relative poverty has increased: The overall number of ‘breadline poor’ households increased – households where people live below the standard poverty line (defined as household income below 60 per cent of median income adjusted for household size). This number has consistently been above 17 per cent, peaking at 27 per cent in 2001.

3. Wealth breeds wealth: Already-wealthy areas have tended to become disproportionately wealthier. There is evidence of increasing polarisation, where rich and poor now live further apart. In areas of some cities over half of all households are now breadline poor. Personal wealth held by the richest 1% of the population grew as a proportion of national share, rising from 17% in 1991 to 24% in 2002.

4. The housing boom has impacted on wealth: 23 per cent of households are now wealthy in terms of housing assets.

5. Pockets of deep poverty in urban areas: Urban clustering of poverty has increased, while wealthy households have concentrated in the outskirts and surrounds of major cities, especially those classified as ‘exclusive wealthy’, which have been steadily concentrating around London.

Unit 1: The rising price of farm crops

This BBC clip explains why farm crop prices are rising
< http://www.bbc.co.uk/mediaselector/check/player/nol/newsid_6290000/newsid_6290500?redirect=6290510.stm&news=1&bbwm=1&nbram=1&bbram=1&nbwm=1 >

a) Explain the 2 demand side effects on price described
b) Explain the 1 supply side effect on price described
c) Draw a D&S diagram to show these effects on farm prices

Unit 2: Public goods: Flood defences

This BBC article says that after the recent floods, much more needs to be spent on flood defences

http://news.bbc.co.uk/1/hi/uk/6283660.stm

a) What are the 2 conditions needed for a public good?
b) Do either or both of these conditions apply to flood defences?
c) How could the problem of free riders be applied to flood defences if they were provided privately?
d) Evaluate the extent to which flood defences are a public good

Unit 1: Demand and the weather: Magners cider

Retailers and producers often complain that demand for their products is effected by the weather. Last week, Magners said the same thing

http://business.guardian.co.uk/story/0,,2125583,00.html

Unit 1: Changes in the market structure of the broadband market

These 2 articles from theBBC and Guardian describe a recent takeover in the broadband market
http://news.bbc.co.uk/1/hi/business/6897687.stm

http://business.guardian.co.uk/story/0,,2126269,00.html

a) From the Guardian article, list the major firms in the industry with the number of customers each has
b) From the information, describe what has happened to the market in terms of competition over the last few years?
c) Explain and justify which market structure model now best fits the broadband market

Unit 2: Negative externalities associated with meat eating

This BBC clip makes you think of the true cost of meat eating
< http://www.bbc.co.uk/mediaselector/check/player/nol/newsid_6280000/newsid_6289500?redirect=6289542.stm&news=1&amp;nbram=1&nbwm=1&bbwm=1&bbram=1 >

a) What is the private cost of eating meat?
b) What, according to the clip, are the external costs associated with meat eating?
c) How does the meat market therefore fail?
d) Draw a diagram to show this market failure
e) Evaluate the different actions the government could take to reduce this market failure

Unit 2: A cost benefit analysis associated with the UK gas supply

As the UK becomes more dependant upon imported LPG a pipline is needed to connect it to the national gas grid
< http://www.bbc.co.uk/mediaselector/check/player/nol/newsid_6280000/newsid_6284600?redirect=6284684.stm&news=1&nbwm=1&bbwm=1&bbram=1&nbram=1 >

a) Identify the private costs and benefits of the pipeline and who they will effect
b) Identify the external costs and benefits of the project and who they will effect
c) What problems would you encounter doing a CBA on this project?

Unit 1: Supply and the price of farm products

This article explains the effect of all the recent flooding on farmers

http://news.bbc.co.uk/1/hi/business/6283810.stm

a) Explain what is likely to happen to the price of many crops as a result of the floods
b) Draw a diagram to show this effect

Unit 1: Quantity demanded and price: Banking

This BBC article clearly shows the link between price and quantity demanded

http://news.bbc.co.uk/1/hi/business/6284342.stm

a) Explain the relationship between price and quantity demanded
b) Link it to this example
c) Draw a diagram to show the change explained in the article

Unit 1: Economies of scale Baby food

This BBC article talks about a proposed merger. The result would be a decrease in the average cost of output for the combined group; ie they will experience economies of scale

http://news.bbc.co.uk/1/hi/business/6286830.stm

a) Give examples of the economies of scale that may arise

b) Can you think of any diseconomies that may arise?

c) Draw a diagram to shot the LRATC of production before and after the merger

Unit 1: The demand for music

This BBC clip shows the changing pattern of how the UK buys its music
< http://www.bbc.co.uk/mediaselector/check/player/nol/newsid_6280000/newsid_6284500?redirect=6284584.stm&news=1&amp;bbram=1&bbwm=1&nbwm=1&nbram=1 >

a) What economic term would you use to describe CDs and music downloads?
b) Using demand theory, explain the decrease in CD sales
c) Draw 2 diagrams to show the effect on the CD and singles download market
d) It is suggested that the record companies could generate more money from their artists via live gigs and merchandising. In economic terms, what is this relationship?

Unit 2: Food as a demerit good

This clip suggests consumers have imperfect knowledge when the choose what to eat and so sandwiches may be an example of a demerit good

< http://www.bbc.co.uk/mediaselector/check/player/nol/newsid_6270000/newsid_6272100?redirect=6272196.stm&news=1&amp;amp;amp;nbram=1&bbwm=1&nbwm=1&bbram=1 >

a) How doea the sandwhich market fail?
b) How could this market failure be overcome

Unit 3: Supply side policy: Information on skills

This BBC article shows the government promoting its supply side policies

http://news.bbc.co.uk/1/hi/education/6278652.stm

Unit 1: Price,quantity demanded and Price elasticity of demand: Playstation 3

This BBC article clearly shows the link between price and quantity demanded for the PS3 in the USA

http://news.bbc.co.uk/1/hi/business/6283170.stm

a) Why are Sony cuting the price?
b) What do they think will happen as a result of the price cut?
c) Draw a diagram to show the effect of the price cut
d) Why might demand for the Playstatioin 3 not rise as Sony expect?

A few days later, Sony announced it would not cut the price of the PS3 in Europe

http://news.bbc.co.uk/1/hi/technology/6896261.stm

e) What reasons do Sony give for not decreasing the price in Europe
f) What do the different prices suggest to you about the price elasticity of demand for the PS3 in Europe and the USA?

Unit 3: The effect of a rise in interest rates

This BBC clip explains the effects of a rise in interest rates
< http://www.bbc.co.uk/mediaselector/check/player/nol/newsid_6270000/newsid_6272100?redirect=6272166.stm&news=1&bbwm=1&nbwm=1&nbram=1&bbram=1 >

a) Draw an AD/AS diagram to show the position of the economy as the MPC of the BoE see it
b) Show on the diagram and explain what the BoE believe will happen as a result of the rise in interest rates
c) The interst rate rise produces both winners and losers. Give examples of people in both catagories
d) Interest rate rises particularly hit those with large mortgages. How would the increase in monthly payments from £391 to £477 effect the economy if reflected across the economy?
e) One problem often cited with using interest rates to control the economy is there is a time lag before the full effect is seen in the economy. What evidence is there to support this view in the clip?

Unit 1: Maximum prices and disequilibrium: Zimbabwe

This BBC article clearly shows what happens if the government steps in and sets a maximum price below the free market equilibrium

http://www.guardian.co.uk/frontpage/story/0,,2119003,00.html

a) Draw a diagram to show what is happening with the introduction of maximum prices
b) Using the diagram and the article, explain what is happening in Zimbabwe

Unit 1: The demand for wellies!

Summer in the UK sees demand for wellies rise according to this BBC article

http://news.bbc.co.uk/1/hi/scotland/south_of_scotland/6277224.stm

a) Use demand theory to identify the 2 factors in the article and use them to explain why demand for wellies has increased
b) Draw a diagram to show the effect of this increase in demand on the market for wellies

Unit 3: Why interest rates have risen

This BBC article and clip explains why interest rates have risen to 5.75%

http://news.bbc.co.uk/1/hi/business/6272776.stm

< http://www.bbc.co.uk/mediaselector/check/player/nol/newsid_6270000/newsid_6272100?redirect=6272166.stm&news=1&nbwm=1&bbram=1&bbwm=1&nbram=1 >

a) What sort of policy is raising interst rates?
b) How is the increase meant to decrease aggregate demand?
c) Draw a digram to show and explain how this increase in interest rates is meant todecrease inflation
d) How do time lags confuse the decision the MPC has to take on setting interest rates?

Unit 1: Supply and Demand: The rise in farm prices

This BBC video clip and article suggests farm prices will rise in the future due to various reasons

http://news.bbc.co.uk/1/hi/business/6270892.stm

< http://www.bbc.co.uk/mediaselector/check/player/nol/newsid_6290000/newsid_6290500?redirect=6290510.stm&news=1&bbwm=1&nbram=1&bbram=1&nbwm=1 >

a) Identify the demand factors likely to fuel the rise in prices
b) Identify the supply factors likely to fuel the rise in prices
c) Draw a S&D diagram to show these effects on farm prices

Unit 2: Market dominance and government action: Telefonica

The European Commission has fined Spain's Telefonica $207m [£102.5m) for stifling competition in the broadband internet market says this BBC article/clip

http://news.bbc.co.uk/1/hi/business/6269514.stm

a) How has Telefonica demonstrated market dominance and why is this an example of market failure?
b) How likely is the fine to overcome the market failure?
c) What alternative approach could the EU have taken to overcome the market failure?

Unit 1: The price of oil

The price of oil goes past $73, a 10 month high says this BBC article

http://news.bbc.co.uk/1/hi/business/6271724.stm

a) What is the main reason given for the price of oil rising?
b) What does the phrase "Ongoing anti-government violence in Nigeria has also put an upward pressure on global oil prices" mean in terms of the market
c) Draw a S&D diagram to show these 2 effects on the price of oil

Unit 3: The exchange rate of the £

The £ hits a 26 year high

http://business.guardian.co.uk/story/0,,2116977,00.html

a) Why has the value of the £ risen?
b) Draw a diagram to show how this rise has occured
c) What effect should this rise in the £ have on the current account of the BOP?

Unit 1: Producer surplus and the Apple iphone

The launch of the iphone by Apple is a good example of producer surplus

http://www.tutor2u.net/newsmanager/templates/?a=2473&z=1

a) Draw a diagram to show the producer surplus described in the article.
b) Explain why this is an example of producer surplus

Unit 3: The costs of economic growth in China

Thit item from Geoff Riley highlights the negative externalities associated with the rapid economic growth in China

http://www.tutor2u.net/newsmanager/templates/?a=2471&z=1

Unit 2: Using legislation to overcome market failure

This BBC article explains how manufacturers are now responsible for disposing of the electical items they produce

http://news.bbc.co.uk/1/hi/sci/tech/6250080.stm

a) Why has this legislation been introduced; ie in which way does the market fail?
b) How successful do you think this will be in reducing the market failure?

Unit 3: 10 years of UK macro data

This series of charts from the BBC shows some aspects of the UK economy during 10 years of Gordon Brown at the treasury

http://news.bbc.co.uk/1/shared/spl/hi/pop_ups/07/business_brown0s_britain/html/1.stm

Unit 1: Contrasting demand for alcohol: Guinness and Whisky

Two stories from the BBC. A clip about falling demand for Guinness in Ireland and the UK and an article about the rising world demand for whisky
< http://www.bbc.co.uk/mediaselector/check/player/nol/newsid_6240000/newsid_6248300?redirect=6248398.stm&news=1&bbwm=1&nbwm=1&bbram=1&nbram=1 >

http://news.bbc.co.uk/1/hi/business/6248304.stm

a) Using the factors that influence demand, explain why demand for Guinness may be falling in Ireland and the UK
b) Using the factors that influence demand, explain why world demand for whisky may be rising c) Use a diagram to show what happens to the demand for Guinness around St Patricks day

Unit 2: Government action to stop market dominance

The EU has blocked Ryanair from taking over Air Lingus

http://news.bbc.co.uk/1/hi/business/6244894.stm

The reaction of Michael O'Leary from Ryanair to this judgement can be seen at

< http://www.bbc.co.uk/mediaselector/check/player/nol/newsid_6240000/newsid_6243900?redirect=6243902.stm&news=1&nbram=1&bbram=1&bbwm=1&nbwm=1 >

A summary of the position comes from Geoff Riley's blog

http://www.tutor2u.net/newsmanager/templates/?a=2459&z=1

a) On what grounds has the merger been blocked?
b) What possible advantages to consumers might have arisen from the combined airline according to Michael O'Leary?
c) Explain whether you agree or disagree with the EU decision decision