AS/A Level Economics 9708

Unit 1: Introductory ideas and the price system

Recommended Prior Knowledge
This Unit starts the course by introducing basic ideas and tools of analysis. Students’ personal experiences as consumer, worker and observer can be drawn into the
exposition of the content.

Context
The material includes demand and supply which will be developed in the following Unit and also used to explain the setting of exchange rates and the effects of some
types of government intervention. Comparative advantage is introduced and will form the basis of international trade in a later Unit.

Outline
The Unit considers the basic ideas of economics and its methods with introductory models of demand and supply and comparative advantage explored.

AO Learning outcomes Suggested Teaching activities Learning resources

The outcomes indicate the abilities and The following activities may be incorporated into standard exposition of Book references:
skills candidates need to develop in the subject content Anderton refers to Anderton Economics
relation to each section of the syllabus The activities are intended to encourage student involvement (third edition) (Causeway Press)

Bamford refers to Bamford AS Level

and A Level Economics (first edition)
(CUP)

Gillespie refers to Gillespie AS & A

Level Economics Through Diagrams
(new edition) (OUP)

Stanlake refers to Stanlake`s

Introductory Economics by S J Grant
(seventh edition) (Longman)

Website references:
http://www.bized.ac.uk
http://www.imf.org
http://www.jusbiz.org

www.xtremepapers.net
AO Learning outcomes Suggested Teaching activities Learning resources
http://www.oheschools.org
http://www.s-cool.co.uk
http://www.tutor2u.net
http://www.worldbank.org
http://www.wto.org

Candidates should
• understand the context of
economics
• be aware of the skills involved
• consider the ‘economist’s toolkit’
Survey the weeks news items to establish economic content. Bamford Introduction
Stanlake Chap 1
Newspapers and magazines:

Business Week
http://www.businessweek.com

The Economist
http://www.economist.com

The Financial Times

http://www.news.ft.com

The Guardian
http://www.guardian.co.uk

The Independent
http://www.independent.co.uk

The Telegraph
http://www.telegraph.co.uk

The Times http://www.timesonline.co.uk

Television:
BBC http://www.bbc.co.uk
CNN http://www.cnn.com

Students should also be encouraged to

use appropriate newspapers,

www.xtremepapers.net
AO Learning outcomes Suggested Teaching activities Learning resources
magazines and television programmes
in their own country and region

Review past exam papers to establish nature of approach and content http://www.cie.org.uk
http://www.cambridgestudents.org.uk
http://www.learncie.org.uk

1e Candidates should distinguish Survey press headlines to identify and contrast positive and normative Anderton Unit 45
between a positive and normative statements
statement Bamford Introduction

Gillespie Page 1

Stanlake Chap 1

Tutor2u Positive and Normative

Economics

1d Candidates should understand the Contrast marginal and average idea by use of numerical data e.g. Anderton Unit 47
concept of the margin and relate weekly film attendances, golf round scores or goals scored each game
decisions to marginal changes by footballers Bamford Chap 9

Gillespie Pages 27, 29 and 30

Stanlake Chap 13

S-cool Costs and their curves

Tutor2u Marginal Costs

1g Candidates should be familiar with the Analyse inputs in contrasting production activities e.g. manufacturing Anderton Unit 2
economist’s classification of resources and farming activity
apply the classification to economic Bamford Chap 1
activities Cotton choices activity
Gillespie Page 1

www.xtremepapers.net
AO Learning outcomes Suggested Teaching activities Learning resources
Stanlake Chap 5

Bized Learning materials Economics

Topic 1, Introductory micro-economics,

Jusbiz The real price of cotton

Tutor2u Factors of Production

1a Candidates should Role play e.g. shipwreck, survival (Economics and Business Education Anderton Unit 1
• understand the nature of wants Association resource}
and resources and the resulting Bamford Chap 1
economic problems Analyse scarcity for individual, company and nation
• recognise the operation of Gillespie Pages 1 and 2
opportunity cost Apply opportunity cost to family e.g. holiday and government e.g. public
• apply opportunity cost to different spending decisions Stanlake Chap 1
choices
Bized Learning materials Economics
Topic 1, Introductory micro-economics

Oheschools Unit 1 The problems of

health care

S-cool Scarcity and Opportunity Cost

Tutor2u Opportunity Cost

Tutor2u Scarcity

1c Candidates should Introduce plotting graphs of ppcs Anderton Unit 1

• understand the nature of the
production possibility curve Examine alternative shapes of curves and significance of movements Bamford Chap 1
• employ production possibility
curves to illustrate the basic Analyse effects of range of changes moving between and within curves Gillespie Pages 2 and 3
economic problem and
opportunity cost Stanlake Chap 2
• interpret the production possibility
curve diagram Bized Learning materials Economics

www.xtremepapers.net
AO Learning outcomes
1i Candidates should
• understand the functions and
characteristics of money and its
importance for economic
progress
• recognise the drawbacks of
barter
1h Candidates should understand the
nature, benefits and limits of division of
labour
contrast the operation of division of
labour in different settings
4a Candidates should distinguish
between absolute and comparative
advantage
apply the principle to demonstrate the
benefits of division of labour
Suggested Teaching activities Learning resources
Topic 1, Introductory micro-economics
Oheschools Unit 1 The problems of
health care
Tutor2u Production Possibility Frontier
Tutor2u Shifts in the Production
Possibility Frontier
Role play exchange without money Anderton Unit 82
Analyse suitability of selected items to serve as money highlighting Bamford Chap 1
weaknesses
Gillespie Page 67
Stanlake Chap 7
Bized Learning materials Economics
Topic 8, Money
Tutor2u Money and its Functions
pin factory, Ford model T and automated production case studies Anderton Unit 2
student research on division of labour within a selected organisation with Bamford Chap 1
report back Stanlake Chap 6
discussion of modern working conditions and motivation Bized Learning materials Economics
Topic 1, Introductory micro-economics;
Topic 3, Firms and virtual developing
country copper field trip
Apply to individual’s employment Anderton Unit 14
Bamford Chap 4
work numerical example Bized Learning materials Economics
translate to production possibility curve approach Topic 11, International economics and
virtual developing country trade field trip
Tutor2u Theory of Comparative
Advantage
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AO Learning outcomes
2a/b Candidates should understand the
nature of individual and market
c demand curves
analyse the factors which influence
d demand curves
distinguish between a shift in and
movement along a curve
2f Candidates should understand the
nature of individual and market supply
g curves
analyse the factors which influence
supply curves
show the effect of the introduction of
an indirect tax or subsidy
distinguish between a shift in and
movement along a curve
1f Candidates should appreciate the
need for ‘ceteris paribus’ in supply and
demand analysis
identify the elements left unchanged in
the application of the assumption
2i Candidates should understand the
setting of an equilibrium price
use diagrams to represent changing
conditions
analyse the effects of changes in
variables
apply the analysis to different products
Suggested Teaching activities Learning resources
Tutor2u Comparative Advantage –
Worked Examples
collate student observation of demand/price relationship Anderton Unit 4
survey factors underlying demand for specified products e.g. oil, Bamford Chap 2
holidays, CDs, DVDs etc Gillespie Pages 4, 5 and 6
graph demand schedules and their movements Stanlake Chap 8
Bized Learning materials Economics
Topic 2, Markets
Oheschools Unit 2 The free market
approach
S-cool The Demand Curve
Tutor2u Theory of Demand
examine producer maximisation motivation Anderton Unit 5
analyse changing supply conditions for different products Bamford Chap 2
graph supply schedules and their movements Gillespie Pages 10, 11 and 13
Stanlake Chap 10
Bized Learning materials Economics
Topic 2, Markets
Oheschools Unit 2 The free market
approach
S-cool The Supply Curve
Tutor2u Theory of Supply
consider range of outcomes without assumption Anderton Units 4 and 5
Bamford Chap 2
discuss operation of familiar market e.g. produce or shares Anderton Unit 6
study price behaviour in a commodity market Bamford Chap 2
plot changes to equilibrium Gillespie Pages 12 and 13
student analysis of given changes on equilibrium and interrelationships Stanlake Chaps 11 and 12
between products with report back Bized Learning materials Economics
determining the price of a house simulation (virtual learning arcade) Topic 2, Markets; virtual learning
the interrelationship between markets simulation (virtual learning arcade; virtual developing country rural
www.xtremepapers.net
AO Learning outcomes
and markets
recognise the relationships between
different products and services e.g.
joint demand and joint supply
2j Candidates should understand the
concept of consumer surplus
illustrate consumer surplus
recognise consumer surplus in
diagrams
Suggested Teaching activities
arcade)
discuss consumer behaviour
examine the demand curve diagram
www.xtremepapers.net
Learning resources
life field trip Oheschools Unit 2 The
free market approach
S-cool The Equilibrium Price
S-cool Real World Applications
Tutor2u Equilibrium Market Price
Anderton Unit 4
Bamford Chap 2
Gillespie Page 23
Stanlake Chap 8
Tutor2u Consumer Surplus