155 Understanding Economics AS Level Book

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Understanding Economics AS Level Book, Notes and past papers. TABLE OF CONTENTS PREFACE HOW TO USE THIS BOOK SECTION 1 BASIC ECONOMIC PROBLEM SCARCITY AND OPPORTUNITY COST MULTIPLE CHOICE QUESTIONS SECTION 2 PRODUCTION POSSIBILITY CURVE PPC AND SCARCITY PPC AND OPPORTUNITY COST PPC AND ECONOMIC EFFICIENCY SHIFTS IN PPC CONSUMER GOODS AND CAPITAL GOODS MULTIPLE CHOICE QUESTIONS SECTION 3 ECONOMIC SYSTEMS FREE MARKET ECONOMY COMMAND ECONOMY MIXED ECONOMY MULTIPLE CHOICE QUESTIONS SECTION 4 POSITIVE AND NORMATIVE STATEMENTS MULTIPLE CHOICE QUESTIONS SECTION 5 DEMAND LAW OF DEMAND DEMAND SCHEDULE DEMAND CURVE FACTORS CAUSING SHIFTS IN THE DEMAND CURVE (DEMAND DETERMINANTS) MULTIPLE CHOICE QUESTIONS SECTION 6 SUPPLY LAW OF SUPPLY SUPPLY SCHEDULE SUPPLY CURVE MULTIPLE CHOICE QUESTIONS SECTION 7 MARKET EQUILIBRIUM CHANGES IN THE EQUILIBRIUM PRICE MULTIPLE CHOICE QUESTIONS SECTION 8 ELASTICITY OF DEMAND PRICE ELASTICITY OF DEMAND (P) Total Revenue (TR) or Total Expenditures (TE) method 89 Graphical Method 92 POINT ELASTICITY OF DEMAND INCOME ELASTICITY OF DEMAND (M) Cross price elasticity of demand (C) 102 Limitations of demand elasticities 104 MULTIPLE CHOICE QUESTIONS SECTION 9 PRICE ELASTICITY OF SUPPLY DETERMINANTS OF PRICE ELASTICITY OF SUPPLY MULTIPLE CHOICE QUESTIONS SECTION 10 CONSUMER AND PRODUCER SURPLUS CONSUMER SURPLUS Changes in Consumer Surplus 140 PRODUCER SURPLUS Changes in Producer Surplus 142 PRICES AS RATIONING AND ALLOCATIVE MECHANISMS MULTIPLE CHOICE QUESTIONS SECTION 11 TAXES AND SUBSIDIES TAXES 156 1) Specific tax 156 2) Ad valorem tax (percentage tax) 156 SUBSIDIES Specific subsidy 161 Ad valorem subsidy (percentage subsidy) 161 MULTIPLE CHOICE QUESTIONS SECTION 12 MAXIMUM AND MINIMUM PRICES MAXIMUM PRICE Impacts of a maximum price 175 MINIMUM PRICE MULTIPLE CHOICE QUESTIONS SECTION 13 PUBLIC AND PRIVATE GOODS PUBLIC GOODS PRIVATE GOODS MERIT GOODS DEMERIT GOODS MULTIPLE CHOICE QUESTIONS SECTION 14 FACTORS OF PRODUCTION (Understanding Economics AS Level Book, Notes and past papers.) (1) LAND (2) CAPITAL (3) LABOUR (4) ENTREPRENEURSHIP DIVISION OF LABOUR MULTIPLE CHOICE QUESTIONS SECTION 15 UNEMPLOYMENT COSTS OF UNEMPLOYMENT REDUCING UNEMPLOYMENT MULTIPLE CHOICE QUESTIONS SECTION 16 MONEY EVOLUTION OF MONEY FUNCTIONS OF MONEY MULTIPLE CHOICE QUESTIONS SECTION 17 AGGREGATE DEMAND & AGGREGATE SUPPLY 229 AGGREGATE DEMAND (AD) AGGREGATE SUPPLY (AS) MULTIPLE CHOICE QUESTIONS SECTION 18 GENERAL PRICE LEVEL: PRICE INDICES LIMITATIONS OF PRICE INDEX NOMINAL AND REAL CHANGES MULTIPLE CHOICE QUESTIONS SECTION 19 INFLATION TYPES OF INFLATION CAUSES OF INFLATION CONSEQUENCES OF INFLATION MULTIPLE CHOICE QUESTIONS SECTION 20 PRINCIPLES OF ABSOLUTE & COMPARATIVE ADVANTAGE THEORY OF ABSOLUTE ADVANTAGE THEORY OF COMPARATIVE ADVANTAGE EXCEPTIONS TO THE THEORIES OF ABSOLUTE & COMPARATIVE ADVANTAGE LIMITATIONS TO THE THEORIES CHALLENGES OF INTERNATIONAL TRADE MULTIPLE CHOICE QUESTIONS SECTION 21 TERMS OF TRADE MULTIPLE CHOICE QUESTIONS SECTION 22 ARGUMENTS FOR FREE TRADE & MOTIVES FOR PROTECTION 296 ARGUMENTS FOR FREE TRADE TYPES (METHODS) OF PROTECTION AND THEIR EFFECTS MULTIPLE CHOICE QUESTIONS SECTION 23 ECONOMIC INTEGRATION FREE TRADE AREA CUSTOMS UNION COMMON MARKET FULL ECONOMIC UNION POLITICAL UNION MULTIPLE CHOICE QUESTIONS SECTION 24 BALANCE OF PAYMENTS (I) CURRENT ACCOUNT (II) FINANCIAL (CAPITAL) ACCOUNT BALANCE OF PAYMENTS PROBLEMS Why is a trade deficit bad? 321 Why is a trade surplus bad? 322 MULTIPLE CHOICE QUESTIONS SECTION 25 EXCHANGE RATES NOMINAL EXCHANGE RATE REAL EXCHANGE RATE PURCHASING POWER PARITY THEORY MANAGED FLOATING FLEXIBLE OR FLOATING EXCHANGE RATES CHANGES IN EXCHANGE RATES FIXED EXCHANGE RATES MANAGED FLOAT ADVANTAGES & DISADVANTAGES OF FIXED & FLOATING EXCHANGE RATES POLICIES TO CORRECT BALANCE OF PAYMENTS DISEQUILIBRIUM POLICIES TO CORRECT A TRADE SURPLUS IMPACTS OF CHANGES IN INTEREST RATE MULTIPLE CHOICE QUESTIONS SECTION 26 FISCAL POLICY MONETARY POLICY SUPPLY SIDE POLICIES AND NATURAL RATE OF UNEMPLOYMENT SYSTEMS OF TAXATION MULTIPLE CHOICE QUESTIONS ANSWERS 393 ( Understanding Economics AS Level Book , Notes and past papers.)