AS Economics Unit 1

ECONOMICS UNIT 1 REVISION NOTES

The nature of economics

Demand and consumer behaviour

  • The demand curve
  • Factors affecting the demand curve (Shifts of the demand curve)
  • Price elasticity of demand (PED)
  • Factors affecting PED (Slope of the demand curve)
  • Income elasticity of demand (YED)
  • Cross elasticity of demand (XED)
  • Consumer behaviour

Supply

  • The supply curve
  • Factors affecting the supply curve (Shifts of the supply curve)
  • Price elasticity of supply
  • Factors affecting PES (Slope of the supply curve)

Price determination

  • Determination of market equilibrium
  • Consumer surplus
  • Producer surplus
  • Functions of the price mechanism
  • Indirect taxes
  • Indirect subsidies

Wage determination in labour markets

  • The demand for labour
  • The supply of labour
  • Determination of wage rates

Market failure

  • Types of market failure
  • Externalities
  • Public goods
  • Imperfect market information
  • Labour immobility

Government intervention in markets

  • Methods of government intervention
  • Government Failure

 

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