Content

3.1 The operation of markets and market failure This section of the specification is primarily about microeconomics. Students will be required to acquire knowledge and understanding of a selection of microeconomic models and to apply these to current problems and issues. Microeconomic models such as demand and supply, the operation of the price mechanism and causes of market failure are central to this part of the specification. Students should be provided with opportunities to use these models to explore current economic behaviour. When applying and evaluating all the microeconomic models in the specification, such as supply and demand theory and production possibility curves, students should be critically aware of the assumptions upon which these models are based and their limitations when they are used to make sense of real world phenomena. Students should be able to apply their knowledge and skills to a wide variety of situations and to different markets and examples of market failure, including environmental market failures. They should appreciate that economic decisions relating to individual markets may be affected by developments in the macroeconomy.

3.2 The national economy in a global context This section of the specification is primarily about macroeconomics. However, students should understand that microeconomic principles underpin the behaviour of the macroeconomy. Understanding some aspects of macroeconomic behaviour requires that students have a firm grasp of related microeconomic principles, for example, understanding of price elasticity of demand is essential when analysing the extent to which a fall in the exchange rate will lead to an increase in exports. Students will be required to acquire knowledge and understanding of AD/AS analysis and should be provided with opportunities to use this analysis to explore recent and current economic behaviour. They should understand, and be able to analyse and evaluate, macroeconomic policy. When applying and evaluating all the macroeconomic models in the specification, such as the circular flow of income and the multiplier process, students should be critically aware of the assumptions upon which these models are based and their limitations when investigating macroeconomic and global issues. Students should have a good knowledge of developments in the UK economy and government policies over the past fifteen years. They should also be aware that the performance of the United Kingdom economy is influenced by its membership of the European Union (EU) and by external events in the international economy.

Contenet

4.1 Individuals, firms, markets and market failure This section of the specification is primarily about microeconomics. Students will be required to acquire knowledge and understanding of a selection of microeconomic models and to apply these to current problems and issues. Microeconomic models such as demand and supply, perfect competition, monopoly, the operation of the price mechanism and the causes of market failure are central to this part of the specification. Students will need to demonstrate a realistic understanding of the decisions made by firms and how their behaviour can be affected by the structure and characteristics of the industry in which they operate. Other key models relate to the operation of labour markets, wage determination and causes of inequalities in the distribution of income and wealth. Students will be expected to understand that traditional economic theory generally assumes that economic agents act rationally but they should also be introduced to models that recognise that consumer and firms’ behaviour is often governed by more complex influences. During their course of study, students should be provided with opportunities to use economic models to explore current economic behaviour. They should be able to apply their knowledge and skills to a wide variety of situations and to different markets and examples of market failure, including environmental and labour market failures. They should appreciate and be able to assess the impact that developments in the European Union and in the global economy have upon microeconomic behaviour and performance

4.2 The national and international economy This section of the specification is primarily about macroeconomics. However, students should understand that microeconomic principles underpin the behaviour of the macroeconomy. Understanding some aspects of macroeconomic behaviour requires that students have a firm grasp of related microeconomic principles, for example, understanding of price elasticity of demand is essential when analysing the impact of changes in the exchange rate on an economy. Students should have a good knowledge of developments in the UK economy and government policies over the past fifteen years. They should also be aware of developments in the world economy, including the European Union, and how these have affected the UK. They are not required to have specific knowledge of economic developments in any individual country, other than the UK, but if this is needed, relevant data will be presented to students. Students should recognise that there are a number of models demonstrating how the macroeconomy works and should appreciate that different economic models provide insights into different aspects of the behaviour of the macroeconomy. When using these models students should be critically aware of the assumptions upon which they are based and their limitations when they are used to make sense of real world phenomena. Furthermore, they should be prepared to propose, analyse and evaluate possible solutions to macroeconomic problems. They will be required to assess the impact and effectiveness of current government policies to deal with these problems, as well as considering alternative policies and approaches.

Students sit examinations in their A Level courses at the end of Year 13. All students will take internal end of year examinations at the end of year 12 to determine suitability to continue with the subject in Year 13. Students who do not meet the required pass grade in the Year 12 end of year examinations will not be permitted to progress into Year 13.

100% exam- three papers

Paper 1: Markets and Market failure (micro) lasts 2 hours, has 80 marks in total and is worth 33.3% of the A Level qualification.

Paper 2: National and International Economy (macro) lasts 2 hours, has 80 marks in total and is worth 33.3% of the A Level qualification.

Paper 3: Economic Principle and Issues (synoptic) lasts 2 hours, has 80 marks in total and is worth 33.3% of the A Level qualification.

Note: For the A Level certificate to be awarded, students have to successfully complete all three exams.