Review of VCE Economics
Summary of proposed changes to the study
design
General changes
The review process for VCE Economics focused on:
 clarifying the key knowledge and key skills to remove ambiguity
 introducing students to economics through a behavioural economics approach
 determining the timespan from which students should develop a detailed understanding of the
performance of the Australian economy. Detailed knowledge drawn from the past two (2) years
is sufficient to inform the understanding of contemporary issues and challenges facing the
Australian economy.
 specifying the construction and interpretation of demand and supply diagrams in the key skills.
Specific changes
Unit 1: The behaviour of consumers and businesses
Unit 1 focuses on the motivations and actions of consumers and business, with students
considering current research about the ways individuals respond to incentives and how technology
may affect their behaviour.
i.
ii.
Area of Study 1: Economics and me
Area of Study 2: Decision-making in markets
Unit 2: Economic trade-offs
Unit 2 investigates the trade-offs inherent in the modern economy. Through analysis of specific
policy measures students consider whether there is an optimal point where equity and efficiency
can be achieved and whether the challenge of balancing the needs of the current generation with
those of future generations can be achieved.
i.
ii.
Area of Study 1: Economic growth, long-term economic prosperity and sustainability
Area of Study 2: Economic efficiency and equity
Unit 3: Australia’s economic prosperity
Unit 3 focuses on developing students’ understanding of the macroeconomy and the factors that
influence the level of aggregate demand and aggregate supply. Economic models and theories
are used to explain how changes in these variables may influence the achievement of the
Government’s domestic economic goals and living standards.
© VCAA July 2015
Review of VCE Economics
i.
ii.
iii.
Area of Study 1: An introduction to microeconomics: the market system, resource allocation
and government intervention
Area of Study 2: Domestic macroeconomic goals
Area of Study 3: Australia and the world economy
Unit 4: Managing the economy
Unit 4 involves a study of the policy instruments the federal government can utilise to influence
macroeconomic goals to positively affect living standards.
i.
ii.
Area of Study 1: Aggregate demand policies and domestic economic stability
Area of Study 2: Aggregate supply policies
Assessment
Outcome statements in all areas of study across Units 1 to 4 have been altered to reflect the focus
of the unit.
Units 1 and 2 Outcome statements
Current Study Outcome
Consultation Draft Outcome
Unit 1
Unit 1
Area of study 1
Explain the role of markets in the
Australian economy, how markets operate to meet
the needs and wants of its citizens, and apply
economic decision making to current economic
problems.
Area of study 1
Describe the economic problem, discuss the role of
consumers and businesses in the economy and analyse
the factors that influence decision making.
Area of study 2
Describe the nature of economic growth and
sustainable development and one other
contemporary economic issue, explain how these
issues are affected by the actions of economic
decision-makers, and evaluate the impact of these
issues on living standards.
Area of study 2
Explain the role of relative prices and other non-price
determinants in the allocation of scarce resources in a
market-based economy.
Current Study Outcome
Consultation Draft Outcome
Unit 2
Unit 2
Area of study 1
Describe the factors that influence Australia’s
population and labour markets, and analyse how
changes in these areas may impact upon living
standards.
Area of study 1
Analyse the potential trade-off between the pursuit of
strong and sustainable economic growth and sustainable
development.
Area of study 2
Describe the nature of two contemporary global
economic issues, explain how each issue is
affected by the actions of economic decisionmakers, and evaluate the impact of the issue on
living standards.
Area of study 2
Analyse the potential trade-off that exists between the
achievement of equity in the distribution of income and
the efficiency of resource allocation.
© VCAA August 2015
Page 2
Review of VCE Economics
Unit 3 Outcome Statements
Current Study Outcome
Consultation Draft Outcome
Outcome 1
Explain how markets operate to
allocate scarce resources, and
discuss the extent to which markets
operate freely in Australia.
Outcome 1
Explain how markets operate to
allocate scarce resources, and
discuss the effect of government
intervention on market outcomes.
Outcome 2
Explain the nature and importance
of key economic goals in Australia,
describe the factors that may have
influenced the achievement of
these goals over the past four
years, and analyse the impact each
of these goals may have on living
standards.
Outcome 2
Identify and analyse the key
contemporary factors that influence
the achievement of domestic
macroeconomic goals.
Outcome 3
Discuss the effect of international
transactions on the prosperity of a
nation.
Total marks
Marks
allocated
Assessment tasks
40
30
The student’s performance on
each outcome should be
assessed using one or more of
the following formats:
• A folio of applied economic
exercises
• Structured questions
• An essay
• A report
30
100
*School-assessed Coursework for Unit 3 contributes 25 per cent.
Unit 4 Outcome Statements
Marks
allocated
Current Study Outcome
Consultation Draft Outcome
Outcome 1
Explain the nature and operation of
government macroeconomic
demand management policies,
explain the relationship between
budgetary and monetary policy, and
analyse how the policies may be
used to achieve key economic
goals and improve living standards
in Australia.
Outcome 1
Explain the nature and operation of
government macroeconomic
demand management policies,
analyse how the policies have been
implemented to achieve economic
goals and discuss the strengths
and weaknesses of the respective
policies in affecting living
standards.
60
Outcome 2
Explain the nature and operation of
government aggregate supply
policies, analyse how they may be
used to achieve key economic
goals and improve living standards
in Australia, and analyse the
current government policy mix.
Outcome 2
Discuss the nature and purpose of
aggregate supply policies, analyse
how the policies have been
implemented to achieve economic
goals and discuss the strengths
and weaknesses of the respective
policies in affecting living
standards.
40
Total marks
*School-assessed Coursework for Unit 4 contributes 25 per cent.
© VCAA August 2015
Page 3
100
Assessment tasks
The student’s performance on
each outcome should be
assessed using one or more of
the following formats:
• An essay
• Structured questions
• Problem-solving exercises
• A report
• A folio of applied economic
questions
• A folio of media
commentaries