Principle of Econs Homework
qychang
ExamRevisionPackage.pptxExam Revision Package
Exam Format
Question 1: Topics 3 & 4 (20 marks) Demand and Supply
Question 2: Topics 5 & 6 (15 marks) GDP and Economic Growth
Question 3: Topic 7 (15 marks) Business Cycle, Unemployment and Inflation
Question 4: Topic 8 (15 marks) Fiscal Policy
Question 5: Topics 9 & 10 (15 marks) Market Structure
Total 80 marks
For the exam, no MCQ. All questions require you to either draw (graphs), or answer in no more than three sentences, and perform calculations
Calculators are allowed for the exam
Answer all questions on MS Word. For drawing of graphs, you can draw on a piece of paper, take a picture then upload your answer (drawing) onto MS Word
Closed Book exam
Q1: Demand and Supply (20 marks)
Definition and explanation of key terms (5 marks) e.g. define the law of demand/supply or shortage/surplus/equilibrium.
Plot a demand and supply curve based on data provided and to identify equilibrium price and quantity (5 marks) (Topic 4 Class Activity 2)
Illustrating (drawing) and explaining how certain events might affect the equilibrium price and quantity of a good (10 marks) (Topic 4 Class Activity 3 and pre-lesson demand and supply practice questions)
Q2: GDP and Economic Growth (15 marks)
Definition of key terms (1-2 marks) GDP, Real GDP, Nominal GDP
Explain the expenditure/income approach to calculating GDP (4-5 marks). Expenditure approach = AD. Income approach = Y
AD = C + I + G + (X – M)
Y = rent + wages + interest + profit
Calculation of production indicators (8-10 marks)
Real and Nominal GDP (No need GDP Deflator)
GDP Growth Rate
GDP per Capita
Q3: Business Cycle, Unemployment and Inflation (15 marks)
Definition of different stages of the business cycle, unemployment, different types of unemployment (5-7 marks)
Frictional Unemployment
Structural Unemployment
Cyclical Unemployment
Calculation of Labour Market indicators and Inflation Rate (8-10 marks)
Unemployment Rate
Employment-to-Population Rate
Labour Force Participation Rate
Q4: Fiscal Policy (15 marks)
Effects of increase/decrease in Government Expenditure/Taxes on GDP. E.g. How does an increase in Government Expenditure affect the GDP and why?
Very important to remember AD = C + I + G + (X – M)
Application of Discretionary/Automatic Fiscal Policies on Unstable Economies (Recessionary/Inflationary)
Calculation of budget balance and identifying budget status
Budget Balance = Tax Receipts (T) – Government Outlay (G)
Budget Status: Surplus (T>G), Deficit (T<G), Balanced Budget (T=G)
Limitations of Discretionary Fiscal Policy / Methods of funding a budget deficit
Q5: Market Structures (15 marks)
Characteristics on the different market structures AND, I will ask you to compare them between market structures. (8 to 10 marks)
Strategies of different market structures (3 to 4 marks)
Identify which market structure an industry/product belongs to (2 to 3 marks)
