Possible Essays Line-Up for 9708/42 of Cambridge A-Level Economics (CIE) (CAIE)

POSSIBLE questions (please take note, POSSIBLE): (will have more updates tonight)

1. Relationship between diminishing marginal returns/ SRAC and economies of scale/ LRAC

2. Whether firms should grow large or remain small

3. Distinguish between market structures e.g. perfect competition vs. monopoly or perfect competition vs. oligopoly etc in terms of pricing, output, barriers, products, productive efficiency, allocative efficiency and others

4. Income effect vs. substitution effect for normal/ inferior/ Giffen goods 

5. Economic efficiency (productive, allocative and social efficiency) and what are market imperfections (absence of public goods, merit goods, demerit goods, externalities etc) and whether government interventions will necessarily improve resource allocations (25 marks) (One of the most predictable questions with a 'one-size-fits-all' approach. They will always ask the same thing over and over again but phrased differently)

6. How wage rate is being determined in a perfectly competitive labour market (need to consider assumptions like homogenous good, homogenous worker, production is in the short run, no imperfections like government and trade unions etc. Then you will need to set up a schedule to show TPL, MPL, APL, MRPL, wage, MCL and ACL. Explain why a firm will hire up the point where MRPL = MCL.Please support your explanations with diagrams too)

7. Whether market forces/ economic theory of wages alone is sufficient to explain wage conditions in the real world (Usually a 25 marks question. First part of essay in most cases is almost similar to (6) above. Then you will have to say that it is not sufficient because wage rates may settle above equilibrium due to unions and government intervention or below equilibrium due to monopsonist employer)

8. Whether wage differential is due to factor 'X' alone (Usually a 25 marks question. Can consider a wide range of factors like PED, PES, monopsonist employer, trade unions, minimum wage, compensating differential, experience, skills and etc)

9. Measures to reduce income inequality and their limitations (provide universal education and healthcare, promote growth, more benefits, more progressive taxation etc)

10. Whether GDP alone is a reliable indicator of standards of living between countries/ rich and poor nations (yes to some extent, no because it ignores population, purchasing power, composition of output, shadow economies, leisure hours and externalities. Propose measures like HDI, NEW and MPI and mention about their limitations too)

11. Causes of unemployment (cyclical, structural, real wage, frictional, voluntary and seasonal unemployment

12. Whether 'X' and 'Y' are the only two characteristics of a poor developing country

13. Injections and multiplier (need to use own numerical example. Consider value of mpc, mps, mpt, mpm and injections. The most ideal number for mpc would be 0.5. Don't forget to use diagrams too)

14. Factors which may influence the level of investment

15. Fiscal/ monetary/ supply-side policies to achieve macroeconomic aims such as higher growth, lower unemployment, lower inflation and improvement in balance of payments (one of my favourites. For evaluations, do consider all the potential conflicts)

16. Conflicts between macroeconomic objectives (I will always use growth against inflation, balance of payments and income inequality. You may then evaluate by saying that it is not a problem if the growth is due to an increase in LRAS, increase in exports and etc)

My concern as a teacher:
a) To a very large extent, many questions are repetitive. However, every time when they repeat themselves, they can be worded/ phrased very differently. As a result you may think that this is an entirely different question when in fact it is not. This is the part where you all have to be very tactful. Let me show you some:

SAMPLE 1

October/ November 2011 (V1)

Question 2

The removal of imperfections in the market leads to an increase in efficiency in the allocation of resources. Discuss whether you agree with this view (25m)

SAMPLE 2:

May/ June 2015 (V2)

Question 7

‘The free market is not the way to achieve sustainable, efficient use of economic resources. Even the famous economist Adam Smith recognised that there was a need for some government involvement’

Discuss whether government involvement in the economy might overcome the weaknesses of the free market system (25m)

SAMPLE 3:

May/ June 2017 (V3)

Question 2

Firms should be allowed to produce in the manner they wish and consumers allowed to buy what they believe they want

Discuss whether this is the best means of ensuring an efficient use of an economy’s resources (25m)

b) You may end up choosing the wrong questions. Due to information failure, you may end up choosing those hard ones thinking that they are more doable AND shunning away from those easier ones thinking that they are hard

c) Watch out for key words/ terms. They can be quite different:

(i) Market share vs. Share market - One is sales turnover/ size of customer base whereas the other one refers to a place where stocks/ shares are exchanged

(ii) Market imperfections vs. imperfect market - One is mainly dealing with all market failures e.g. absence of public goods, merit goods, demerit goods, including monopoly itself. The other one is mainly market structure e.g. monopolistic, oligpoly and monopoly 

(iii) Wage inequality vs. income inequality - One is where the question is probably asking about reasons for wage differentials while the second is about discussion on how to reduce income gap between the very rich and poor

d) Please, monitor on how you use your time. Learn to write concisely. Do not write excessively. Use fewer but more effective words e.g. economic terms. Also, do not evaluate unnecessarily when the question does not require you to do so. It is a big waste of time which can have impact like opportunity cost e.g. being unable to finish next question means lower overall marks and grades 

e) Please do a quick planning for your essay before start writing. Avoid becoming a 'lost wanderer'. From my observations, those who normally don't plan for their essays are those who will always take longer to think of their next course of action

f) Finally, practice smart and not hard. Practice doesn't make perfect unless you perfect the way you practice

All the best for this Thursday's exam

(Gentle reminder - The list of questions above are just my guess/ opinion/ prediction and they ARE NOT DEFINITE)

Basic Examination Techniques for Section B of 9708/42 Cambridge A-Level Economics (CIE)

This post is a continuation from the previous one.

1. Ideal marks for an 'A' would be:

a) 14/20 from Section A

b) 17/25 for each essay under Section B

All would add up to 48/70, the 'standard' raw marks for an A (obviously better if you can score higher)

2. A good essay would generally have the following characteristics:

a) Written in simple and yet easy to understand English

b) Has short sentences of ideally 20 - 25 words per line. Do not use commas excessively. Also, do not squeeze/ stuff in too many ideas per line. Otherwise, that would reduce the explanatory power of the sentence. The communication between you and the examiner will become less clear. Always allow the chains of analysis to be conducted part-by-part and line-by-line

c) Use plenty of connectives e.g. moreover, therefore, although, somehow, however, having said so, next etc 

d) Always use diagram(s) where ever applicable. Do remember that examiners love diagrams. They help to make your ideas sound loud

e) Amplify the use of economic vocabularies e.g. paradox of thrift, liquidity trap, crowding out effect, wealth effect, comparative advantage, austerity measures and many more. Once in a while, do insert names like Keynes, Milton Friedman, Alfred Marshall etc. It makes the examiner 'wants' to award you with more marks

f) Throw in real life examples e.g. global financial crisis 08/09, housing bubble burst in the UK, hyperinflation in Venezuela, peace talks with rebels in Colombia leading a rise in PPC, many Sub-Saharan African nations are landlocked making it difficult to engage in maritime trade etc

3. To some extent (whether we like it or not), essays in Section B are marked not only based on economic contents but also on how they being presented/ delivered. Yes, you guessed it correctly! There will be some elements of impression-based marking. This explains why marks for every level have a range

4. Efficient time allocation would be:

a) 25 minutes for a 12 marks/ 13 marks essay

b) not more than 50 minutes for a 25 marks essay

5. Diagram(s) may be introduced before the starting of an analysis or after it. If possible, try to make sure that the diagram is on the same page as the analysis

6. You may require OWN numerical examples for areas like:

a) relationship between TPL and MPL

b) how a rational consumer allocates his/ her income between two goods 

c) injection, multiplier and national income

Nothing speaks louder than numbers themselves! Without them, explanations would become less clear. Sometimes, almost certainly you have lesser to write/ nothing to write without a numerical example to be based upon

7. Always plan your essays before writing them out. Why is it so important? Without planning, few possibilities may occur:

a) You may over-develop certain parts of the essay just to realise that there is not much time left for other areas. Therefore, other areas become under-develop e.g. remaining analysis, evaluations left out and conclusion ignored

b) You may not realise that the essay is difficult/ unsuitable for you. You can only tell effectively if you had planned right from the start. It may be too late to switch to another question

c) You will have poorer time management. Had you organised earlier, you would have been able to tell how many paragraphs are there and roughly how much time should be allocated to each of them

8. Per analysis is about 4-6 lines. That depends too on what the analysis is all about. It is usually shorter say, how a cut in interest rates would result in demand-pull inflation than say, explaining the inverse relationship between MPL and MC

9.   It is a fact, for some reasons that to achieve Level 2 marks is much, much.....easier than achieving Level 3 or even Level 4 marks

10. Generally (but not always), macroeconomic essays are much more easier than microeconomics essays. These are some of the reasons I can offer:

a) They have much fewer diagrams (let's count them e.g. AD/ AS, Keynesian cross, Laffer curve, J-curve. Any more?)

b) They have way fewer calculations/ numerical analysis. I can only think of multiplier effect or credit creation (haven't seen this in essay though)

c) It is way simpler to build chain of analysis in macro than micro

d) Macroeconomic essays are predictable too

Basic Examination Techniques for Section A of 9708/42 Cambridge A-Level Economics (CIE)

Dos and don’ts in Section A

1.    Do not provide lengthy and unnecessary explanations for instructions like IDENTIFY, OUTLINE and STATE

2.    Do not start your sentence by reproducing/ rewriting part of the question. They don’t add value to your explanations

3.    Pay attention to instructions like:

a.    ‘The article says that ….’

b.    ‘Figure 1 shows ….’

c.    ‘How far does Figure 1 ….’

d.    ‘Discuss whether the last sentence ….’

e.    ‘Using the article ….’

All of them will require you to make specific reference to the information provided. You may not gain full marks if you ignore these instructions

4.    You must provide evaluations to instructions like:

a.    ‘Consider whether ….’

b.    ‘Analyse whether ….’

c.    ‘Does the article give enough evidence ….’

d.    ‘Discuss what difference ….’

e.    ‘Assess whether ….’

5.    Normally, 2 marks will be awarded for:

a.    1 explanation (identification and analysis)

b.    1 evaluation (identification and analysis)

c.    1 diagram

6.    You should not spend more than 50 minutes for this section

7.    You will lose 1 mark if you do not provide conclusion. However, it is also possible that you may not gain full marks even if you provided a conclusion. Your examiner will still have to determine the validity of your conclusion e.g. whether it is making sense, suitable or relevant to the question

8.    Techniques to evaluate include:

a.    Contradiction

b.    Short-run vs. long-run

c.    Magnitude

9.    Techniques for conclusion include:

a.    Prioritisation

b.    Depends/ indeterminate

c.    Alternative

10.  Please write your analysis coherently. Please make sure that the chain of analysis is not only logical but also complete and easy to be understood. Put yourself in the examiner’s shoe

11.  Read each question at least twice before you attempt. If there is a need, do underline those keywords  

12.  Doing well in the exam are not just about studies and preparations. Being able to follow basic instructions and monitor your time-usage are equally important too

EU immigrants and jobs in the UK

Just a random thought of this. It seems that the selling point of the proponents of Brexit is, EU immigrants are taking away jobs from the natives. I don't quite agree on this. This is because:
a) When they gain employment, they will increase consumption into the real economy. More good and services will have to be produced. This means more manpower will be needed

b) They also contribute significantly to tax revenue. This improves government finances and as a result, more jobs can be created in the public sector or at least, it stops the government from continuing to lay off workers

The labour market fallacy comes from the assumption that the number of jobs are static/ fixed. So, as immigrants filled up one, there will be one less opening for the natives. Well, this is not quite true. The labour market is flexible. It adapts and evolves. In short, it is dynamic. Many more jobs will be created as fast as they are taken up

Foreign workers are only a threat under the following circumstances:
 
a) Bulk of the income is sent back as remittances. However, they still need to spend substantially within the UK due to the high costs of living

b) They increase the supply of labour thereby reducing the equilibrium market wage. While migrants are prepared to accept low paid jobs, the natives aren't. However, this cannot be said as taking away jobs. If locals are willing to accept, they will still get employed

c) Foreign workers are more skilled than locals. However, this will not become a major issue if the unemployed are prepared to make themselves more marketable to potential employers by improving their existing skill levels/ education attainment. Job market today isn't the same as the past. So, there must come a point where all job-seekers must remain competitive and relevant