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EnglandEconomics

Component 1: Microeconomics - Introduction to markets

5 dot points across 5 inquiry questions. Click any dot point for a focused answer with worked past exam questions where available.

How do demand and supply interact to set the equilibrium price and quantity in a competitive market?

1.2 Demand, supply and market equilibrium: the determinants of demand and supply, movements versus shifts, equilibrium and disequilibrium, and consumer and producer surplus.
An OCR H460 answer to how competitive markets work, covering the determinants of demand and supply, the difference between movements and shifts, market equilibrium and disequilibrium, and consumer and producer surplus.
11 min answer →

How do market, planned and mixed economies allocate resources, and what does efficient allocation mean?

1.2 Economic systems and efficiency: market, planned and mixed economies, the role of the price mechanism in resource allocation, and allocative, productive and dynamic efficiency.
An OCR H460 answer to economic systems and efficiency, covering free-market, command and mixed economies, the rationing, signalling and incentive functions of the price mechanism, and allocative, productive and dynamic efficiency.
10 min answer →

How do the four elasticities measure responsiveness, and why do they matter for revenue and policy?

1.2 Elasticities: price, income and cross elasticity of demand and price elasticity of supply, their calculation and determinants, and the link between PED and total revenue.
An OCR H460 answer to the four elasticities, covering price, income and cross elasticity of demand and price elasticity of supply, how each is calculated and interpreted, their determinants, and the link between price elasticity of demand and total revenue.
12 min answer →

How does a production possibility frontier model scarcity, choice, opportunity cost and growth?

1.1 Production possibility frontiers: the PPF as a model of scarcity and choice, points on, inside and beyond the curve, opportunity cost along the frontier, the shape of the curve, and shifts representing growth or decline.
An OCR H460 answer to production possibility frontiers, covering the PPF as a model of scarcity and choice, points on, inside and beyond the curve, opportunity cost along the frontier, why the curve is bowed out, and the difference between movements and shifts.
10 min answer →

Why does scarcity force every economy to choose, and what does each choice cost?

1.1 Scarcity, choice and opportunity cost: the basic economic problem, finite resources and infinite wants, the factors of production, and positive versus normative statements.
An OCR H460 answer to the basic economic problem, covering scarcity, finite resources and infinite wants, opportunity cost, the four factors of production and their rewards, and the difference between positive and normative statements.
9 min answer →