Micro Essay Writing Flashcards
what is the general structure on writing a 10 marker?
of the entire essay
- a definition paragraph ( need at least 2 )
- look a extract at choose whether you are for/against or postive / negative
- whichever there are more points on choose this side of the argument for main side
- signpost first paragraph with “firstly”
- if required reword the question phrasing
how would you describe the positive consumption digram in an essay?
external benefits mean that MSB is above MPB, so consumers will underconsume ( QeQ1) good A. This creates a potential welfare gain, so society could benefit from increased consumption of good A
how would you use the quantify framework for evaluating an externality?
However, it is difficult to quantify external benefits/ costs like reserach and devleopment. The extracts are missing information on how much innovation universities actually lead to, how much these innovations actually help firms or how many benefit. So we cannot accuratly quantify the external benefits or economic effects.
how would you use the time framework for evaluating externalities?
However, degrees can takes years to complete, so in the short run firms will not enjoy any external benefits. Since “ alot of people start but never finish” , the long run benefits may never be seen if students do not compleet theor course.
mentioning what happens in the short run and the long run
how would you use the opposite frameowrk when evalutating externailities?
However, higher education can lead to an issue of “alcoholism”. This will worsen the health of students, decreasing their future productivit. Less productive workers will reduce firms profits and poorer health will pass a greater strain onto the NHS worsening the goverment’s budget decficit.
like writing a paragraph from the other side
explain this diagram
the tax will increase the MPC to MPC+Tax, this will reduce production to Qs which is the soially efficent equilibrium, interanilising the external cost and, reducing the welfare loss, benefitting society
what is an easy evaluation for tax?
unintended consequences: black market
how can NASBIT be used in exam questions context?
what does it mean when it asks for
* “microeconomic effects”
* “economic effects”
effect on
* consumers
* producers
* government
what are the consumers main concerns/ points?
- income—> better living standards
- prices–> consumer surplus
- living standards
- health—> productivity—> higher incomes
- Quality of goods
what are the producer main points/ concerns?
- profits
- cost & revenue–> producer burden
- investment
what are the goverment main points/concerns?
- tax revenue
- goverment spending
- society
what is the framework for evaluating externalities?
- O pposite externality (also positive externaility)
- Q uantify (difficult to calculate - not enough information as to how many people are affected, value judgments- putting a value on noise pollutions
- T ime (long run/ short run- temporary/permenant)
what does the mates framework stand for and what is it used for?
used for evaluating micro points
* Missing information
* Applies to all people?
* Time
* Elasticity
* Size and scalability
how would you use the missing information point in an evalutation?
However, there is missing information as it doesn’t mention how much prices were originally. If prices were orginially low, then a 6% increase would be insignificant to firms, not reducing supply significantly…
how would you use Applies to all people? in the MATES framework?
However, some UK firms produce oil and so will have an increased producer surplus from the higher prices, leading to increases in revenues and profits …..
how would you use Time in the MATES framework?
is this temproary/ short run or permenant
However, oil prices fluctate a lot, the price increase could just be temprory and only affect firms in the short run. In the long run if demand deacreses , oil prices will decraese agaian and so firms profits may not be affected in the long run
How would you use Elasticity in the MATES framework?
PED, PES, XED
adjust the supply demand diagram to make chnage the elasticity of the curve that hasn’t shifted.
eg: if supply was shown to shift.
However, demand for some goods may be inelastic, therefore the chnage in supply only decraeses the quantity by a small quantity, firms may still be able to maintain their profits
what are some go to points and evaluations for tradable pollution permits?
What are some Go to points and evaluations for minimum price?
What are some Go to Points and evaluations for maximum price
What are some Go to Points and evaluations for indirect tax?
What are some Go to points and evaluations for Subsidies ?
What are some Go to Points and evaluations for state provision?
OQT framework
What are some Go To points for comparing pollution permits vs Carbon Tax?
tactic for “should the goverment intervene ect…..”
- classify into positive economic effects and negative economic effects
- describe usual effect on government/consumer/producer
- THEN LINK BACK and say “Therefore the government should/ should not intervene”
