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Individuals, firms, markets and market failure
1. The economic problem and economic methodology
2. Individual economic decision making
3. Price determination in a competitive market
4. Production, costs and revenue
5. Perfect competition, imperfectly competitive markets and monopoly
6. The labour market
7. The distribution of income and wealth: poverty and inequality
8. The market mechanism, market failure and government intervention in markets
The national and international economy
9. The measurement of macroeconomic performance
10. How the macroeconomy works : the circular flow of income, AD/AS analysis, and related concepts
11. Economic performance
12. Financial markets and monetary policy
13. Fiscal policy and supply-side policies
14. The international economy
The operation of markets and market failure
1. Economic methodology and the economic problem
2. Price determination in a competitive market
3. Production, costs and revenue
4. Competitive and concentrated markets
5. The market mechanism, market failure and government intervention in markets
The national economy in a global context
6. The measurement of macroeconomic performance
7. How the macroeconomy works : the circular flow of income, AD/AS analysis, and related concepts
8. Economic performance
9. Macroeconomic policy
Theme 1: Introduction to markets and market failure
This theme focuses on microeconomic concepts. Students will develop an understanding of:
● nature of economics
● how markets work
● market failure
● government intervention
Theme 2: The UK economy – performance and policies
This theme focuses on macroeconomic concepts. Students will develop an understanding of:
● measures of economic performance
● aggregate demand
● aggregate supply
● national income
● economic growth
● macroeconomic objectives and policy
Theme 3: Business behaviour and the labour market
This theme develops the microeconomic concepts introduced in Theme 1 and focuses on business economics.
Students will develop an understanding of:
● business growth
● business objectives
● revenues, costs and profits
● market structures
● labour market
● government intervention
Theme 4: A global perspective
This theme develops the macroeconomic concepts introduced in Theme 2 and applies these concepts in a global context. Students will develop an understanding of:
● international economics
● poverty and inequality
● emerging and developing economies
● the financial sector
● role of the state in the macroeconomy.
Theme 1: Markets, consumers and firms
Students will develop an understanding of:
● scarcity, choice and potential conflicts
● enterprise, business and the economy
● introducing the market
● the role of credit in the economy
● market failure and government intervention
● revenue, costs, profits and cash
Theme 2: The wider economic environment
● business growth and competitive advantage
● firms, consumers and elasticities of demand
● productive efficiency
● life in a global economy
● the economic cycle
● introduction to macroeconomic policy.
Theme 3: The global economy
This theme develops the concepts introduced in Theme 2. Students will develop an understanding of:
● globalisation
● economic factors in business expansion
● impact of globalisation on global companies
● impact of globalisation on local and national economies
● global labour markets
● inequality and redistribution.
Students will develop an understanding of:
Theme 4: Making markets work
This theme develops the concepts introduced in Theme 1. Students will develop an understanding of:
● competition and market power
● market power and market failure
● market failure across the economy
● macroeconomic policies and impact on firms and individuals
● risk and the financial sector.
Microeconomics
Introduction to Microeconomics
1.1 The Economic Problem
1.2 The Allocation of Resources
1.3 Opportunity Cost
The Role of Markets
2.1 Specialisation and Trade
2.2 Demand
2.3 Supply
2.4 Consumer and Producer Surplus
2.5 The Interaction of Markets
2.6 Elasticity
2.7 Market Failure and Externalities
2.8 Government Intervention
Macroeconomics
Aggregate Demand and Aggregate Supply
1.1 Circular Flow of Income
1.2 Aggregate Demand
1.3 Aggregate Supply
1.4 The Interaction of Aggregate Demand and Supply
Economic Policy Objectives
2.1 Economic Growth
2.2 Development
2.3 Employment
2.4 Inflation
2.5 Balance of Payments
2.6 Trends in Macroeconomic Indicators
Implementing Policy
3.1 Fiscal Policy
3.2 Monetary Policy
3.3 Supply-Side Policy
3.4 Policy Conflicts
1. Introduction to Microeconomics
1.1 The economic problem
1.2 The allocation of resources
1.3 Opportunity cost
2. The role of markets
2.1 Specialisation and trade
2.2 Demand
2.3 Supply
2.4 Consumer and producer surplus
2.5 The interaction of markets
2.6 Elasticity
2.7 The concept of the margin
2.8 Market failure and externalities
2.9 Information failure
2.10 Public goods
2.11 Government intervention
3. Business Objectives
3.1 Business objectives
3.2 Costs and economies of scale
3.3 Revenue and profit
4. Market structures
4.1 Perfect competition
4.2 Monopoly
4.3 Monopolistic competition
4.4 Oligopoly
4.5 Contestable markets
5. The labour market
5.1 Demand for labour
5.2 Supply of labour
5.3 The interaction of labour markets
Macroeconomics
1. Aggregate demand and aggregate supply
1.1 Circular flow of income
1.2 Aggregate demand
1.3 Aggregate supply
1.4 The interaction of aggregate demand and supply
1.5 The multiplier and the accelerator
2. Economic policy objectives
2.1 Economic growth
2.2 Development
2.3 Employment
2.4 Inflation
2.5 Balance of payments
2.6 Trends in macroeconomic indicators
2.7 Income distribution and welfare
2.8 The Phillips Curve
3. Implementing policy
3.1 Fiscal policy
3.2 Monetary policy
3.3 Supply side policy
3.4 Policy conflicts
4. The global context
4.1 International trade
4.2 Exchange rates
4.3 Globalisation
4.4 Trade policies and negotiations
5. The financial sector
5.1 Money and interest rates
5.2 The financial sector
5.3 Financial regulation
Unit 1: Markets in Action
1.3.1 Introductory Concepts
The nature of economics
Positive and normative economics
Scarcity
Production possibility frontiers
Specialisation and the role of money and financial markets
Free market, mixed, and command economies
1.3.2 Consumer Behaviour and Demand
Rational decision making
The demand curve
Price, income, and cross-elasticities of demand
1.3.3 Supply
The supply curve
Price elasticity of supply
1.3.4 Price Determination
Determination of market equilibrium
Consumer and producer surplus
Functions of the price mechanism
Indirect taxes and subsidies
1.3.5 Market Failure
Sources of market failure
Positive and negative externalities
Non-provision of public goods
Imperfect market information
Moral hazard
Speculation and market bubbles
1.3.6 Government Intervention in Markets
Purpose and methods of government intervention
Government failure
Unit 2: Macroeconomic Performance and Policy
2.3.1 Measures of Economic Performance
Economic growth
Inflation
Employment and unemployment
Balance of payments
2.3.2 Aggregate Demand (AD)
The characteristics of AD
Consumption (C)
Investment (I)
Government expenditure (G)
Net trade balance (X−M)
2.3.3 Aggregate Supply (AS)
The characteristics of AS
Short-run AS (SRAS)
Long-run AS (LRAS)
2.3.4 National Income
National income
Injections and withdrawals
Equilibrium level of real output
The multiplier
2.3.5 Economic Growth
Causes of growth
Benefits of growth
Costs of growth
Output gaps
2.3.6 Macroeconomic Objectives and Policies
Macroeconomic objectives
Possible conflicts between macroeconomic objectives
Macroeconomic supply-side policies
Macroeconomic demand-side policies
Unit 3: Business Behaviour
3.3.1 Types and Sizes of Businesses
Types of businesses
Size of businesses
Business objectives
3.3.2 Revenue, Costs, and Profits
Revenue
Costs
Economies and diseconomies of scale
Profits and losses
3.3.3 Market Structures and Contestability
Efficiency
Concentration ratio
Perfect competition
Monopolistic competition
Oligopoly
Monopoly
Monopsony
Contestability
3.3.4 Labour Markets
The demand for labour
The supply of labour
The determination of wage rates
Market failure in the labour market
3.3.5 Government Intervention
Government intervention in product markets
Government intervention in labour markets
Unit 4: Developments in the Global Economy
4.3.1 Causes and Effects of Globalisation
Characteristics of globalisation
Causes of globalisation
Effects of globalisation
4.3.2 Trade and the Global Economy
Specialisation and comparative advantage
Patterns and volume of world trade
Terms of trade
Trade liberalisation and trading blocs
Restrictions on free trade
4.3.3 Balance of Payments, Exchange Rates, and International Competitiveness
Balance of payments
Exchange rates
International competitiveness
4.3.4 Poverty and Inequality
Poverty
Inequality
4.3.5 The Role of the State in the Macroeconomy
Public expenditure
Taxation
Public sector borrowing and public sector debt
Macroeconomic policies
4.3.6 Growth and Development in Developing, Emerging, and Developed Economies
Measures of economic development
Constraints on growth and development
Measures to promote growth and development
Unit 1: Introduction to Economics
1.1 What is economics?
1.2 How do economists approach the world?
Unit 2: Microeconomics
2.1 Demand
2.2 Supply
2.3 Competitive market equilibrium
2.4 Critique of maximizing behaviour of consumers and producers (HL only)
2.5 Elasticities of demand
2.6 Elasticity of supply
2.7 Role of government in microeconomics
2.8 Market failure – externalities and common pool or common access resources
2.9 Market failure – public goods
2.10 Market failure (HL only)
2.11 Market failure – market power (HL only)
2.12 The market’s ability to achieve equity (HL only)
Unit 3: Macroeconomics
3.1 Measuring economic activity and illustrating its variations
3.2 Variations in economic activity—aggregate demand and aggregate supply
3.3 Macroeconomic objectives
3.4 Economics of inequality and poverty
3.5 Demand management (demand-side policies): monetary policy
3.6 Demand management: fiscal policy
Unit 4: The Global Economy
4.1 Benefits of international trade
4.2 Types of trade protection
4.3 Arguments for and against trade control/protection
4.4 World Trade Organization (WTO) and trade liberalization
4.5 Trading blocs and bilateral/multilateral trade agreements
4.6 Terms of trade (HL only)
4.7 Exchange rates
4.8 Balance of payments
4.9 Globalization
4.10 Economic development
4.11 Barriers to economic development
4.12 Strategies to promote economic development
4.13 Foreign aid and multilateral development assistance
4.14 Foreign direct investment (FDI), multinational corporations (MNCs) and development
4.15 The role of international debt
4.16 The role of the International Monetary Fund (IMF) and the World Bank
4.17 Development strategies: evaluation and comparison
