A-Level Economics Notes Exam boards 1. AQA 2. Edexcel 3. International Edexcel Year 12 Microeconomics 1. The economic problem 2. Production possibility frontiers 3. Demand 4. Supply 5. Price elasticity of demand 6. Income elasticity of demand 7. Cross elasticity of demand 8. Price elasticity of supply 9. Free market vs command economy
Y13 Microeconomics Notes Monopolistic Competition | Notes What are the characteristics of monopolistic competition? 1. low barriers to entry and exit 2. slight product differentiation Monopolistic competition diagram in the short-run Efficiencies in the short-run * not productively efficient because MC≠AC at q1 * not allocatively efficient because AR≠MC at q1 What happens in monopolistic competition in
Y13 Microeconomics Notes Efficiency | Notes What is productive efficiency? 1. productive efficiency is achieved at the quantity where MC=AC 2. this is when firms minimise their average costs 3. this means firms are producing the maximum possible output at the minimum possible cost 4. in the long-run, it means firms are fully able to
Y13 Microeconomics Notes Perfect Competition | Notes What are the characteristics of perfect competition? 1. no barriers to entry or exit 2. perfect information 3. identical products 4. firms are price-takers Perfect competition diagram in the short-run Efficiencies in the short-run * not productively efficient because MC≠AC at q1 * allocatively efficient because AR=MC at q1 What
Y12 Macroeconomics Notes Aggregate Supply | Notes What is aggregate supply? The total planned level of output in the economy at each price level. What factors affect short-run aggregate supply? Costs of production e.g. productivity, wages, raw material prices, exchange rates What is long-run aggregate supply? The productive potential of the economy. What factors affect long-run
Y13 Macroeconomics Notes Exchange Rates | Notes What is an exchange rate? The price of a currency in terms of another What is a fixed exchange rate? The value of the currency is controlled by the central bank. The central bank uses reserves of their own currency and a foreign currency. For example, China want to maintain
Y12 Macroeconomics Notes Aggregate Demand | Notes What is aggregate demand? Aggregate demand is the total planned spending on goods and services in the economy at each price level. What are the factors of aggregate demand? AD = C + I + G + (X-M) * consumer spending * real incomes * consumer confidence * interest rates * business spending on capital goods * business confidence (accelerator
Y12 Macroeconomics Notes Unemployment | Notes What is unemployment? The number of people who are willing and able to work, but cannot find a job. How is unemployment measured? 1. Labour Force Survey 1. a quarterly survey asking 60,000 households about their employment status 2. Claimant Count 1. a count of those who are claiming
Y12 Macroeconomics Notes Economic Growth | Notes What is the difference between real and nominal? Real - adjusted for inflation Nominal - not adjusted for inflation What does per capita mean? per person (divide by the population) What is real GDP? The total value of goods and services produced in the UK economy What is (actual) economic
Y12 Macroeconomics Notes Inflation | Notes How is inflation measured? Inflation is measured using the CPI (Consumer Price Index) It tracks the prices of a weighted basket of goods and services in the UK. What is inflation? A rise in the average price level. What is deflation? A fall in the average price level. What is