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Economics in Action (AS Unit 2)

7 dot points across 7 inquiry questions. Click any dot point for a focused answer with worked past exam questions where available.

What are the components of aggregate demand and aggregate supply, and what causes each to shift?

The components and determinants of aggregate demand, and short-run and long-run aggregate supply and their shifts.
A focused answer to the WJEC A-Level Economics topic of aggregate demand and aggregate supply, covering the components of AD, the determinants and shifts of AD and of short-run and long-run AS, with UK examples.
12 min answer →

How do aggregate demand and aggregate supply interact to set output and the price level, and how do the Keynesian and Neo-Classical views differ?

The interaction of aggregate demand and aggregate supply, macroeconomic equilibrium, and the Keynesian and Neo-Classical views of long-run aggregate supply.
A focused answer to the WJEC A-Level Economics topic of AD/AS interaction, covering macroeconomic equilibrium, the effects of demand and supply shifts, and the contrast between the Keynesian and Neo-Classical views of long-run aggregate supply, with UK examples.
12 min answer →

How does income circulate around an economy, and what determines the level of national income?

The circular flow of income, injections and withdrawals, and the determination of national income equilibrium.
A focused answer to the WJEC A-Level Economics topic of the circular flow of income, covering injections and withdrawals, the determination of national income equilibrium and the multiplier, with UK examples and a worked calculation.
12 min answer →

How are exchange rates determined, and what are the effects of a change in the exchange rate?

Exchange rate determination, the effects of changes in the exchange rate, the use of exchange rate policy and the Marshall-Lerner condition.
A focused answer to the WJEC A-Level Economics topic of exchange rates, covering how floating exchange rates are determined, the effects of appreciation and depreciation, exchange rate policy and the Marshall-Lerner condition and J-curve, with UK examples.
12 min answer →

Why do countries trade, and what are the costs and benefits of free trade and protectionism?

Free trade, comparative advantage, the costs and benefits of protectionism, globalisation, sustainable development and international competitiveness.
A focused answer to the WJEC A-Level Economics topic of international trade, covering comparative advantage and the gains from free trade, the methods, costs and benefits of protectionism, globalisation, sustainable development and international competitiveness, with UK examples.
13 min answer →

What are a government's main macroeconomic objectives, and why do they sometimes conflict?

Government macroeconomic objectives: economic growth, low inflation, low unemployment and a satisfactory balance of payments, and the conflicts between them.
A focused answer to the WJEC A-Level Economics topic of government macroeconomic objectives, covering economic growth, low and stable inflation, low unemployment and a satisfactory balance of payments, how each is measured, and the conflicts and trade-offs between them, with UK examples.
12 min answer →

What policy instruments can a government use to achieve its macroeconomic objectives?

Macroeconomic policy instruments: fiscal policy, monetary policy and supply-side policy, and their effects and limitations.
A focused answer to the WJEC A-Level Economics topic of macroeconomic policy instruments, covering fiscal policy, monetary policy and supply-side policy, how each works through AD or AS, and their strengths and limitations, with UK examples.
13 min answer →