Scheme of work
Cambridge International AS and A Level
Economics (US)
9275
For examination from 2014
Scheme of work – Cambridge International AS and A Level Economics (US) 9275
Contents
Overview .......................................................................................................................................................................................................................................................... 3
Unit 1: Introductory ideas and the price system ......................................................................................................................................................................................... 6
Unit 2: The price system in detail ............................................................................................................................................................................................................... 12
Unit 3: Macroeconomic measurement, theory and inflation .................................................................................................................................................................... 16
Unit 4: International trade ............................................................................................................................................................................................................................ 20
Unit 5: International trade problems and policies ..................................................................................................................................................................................... 25
Unit 6: Basic economic ideas ...................................................................................................................................................................................................................... 30
Unit 7: The price system and theory of the firm ........................................................................................................................................................................................ 32
Unit 8: Government intervention in the price system ............................................................................................................................................................................... 41
Unit 9: Theory and measurement in the macroeconomy ......................................................................................................................................................................... 45
Unit 10: Macroeconomic problems and policies ....................................................................................................................................................................................... 50
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Cambridge International AS and A Level Economics (US) 9275 – from 2014
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Scheme of work – Cambridge International AS and A Level Economics (US) 9275
Overview
This scheme of work provides ideas about how to construct and deliver a course. The syllabus has been broken down into teaching units with suggested teaching
activities and learning resources to use in the classroom.
Note: Syllabus 9275 (US) runs parallel to the Cambridge International AS and A Level Economics syllabus 9708, with the same content and assessment structure.
Recommended prior knowledge
It is possible to take the course without prior study. In this case learners need to be able to:
 think logically and critically
 express their thinking accurately
 handle data with confidence
 be aware of current events
 be familiar with the use of ICT.
The study of Cambridge IGCSE® or O Level Economics syllabus provides a thorough preparation for this course.
Outline
Whole class, group work, and individual activities are recommended throughout this scheme of work. The activities in the scheme of work are only suggestions and
there are many other useful activities to be found in the materials referred to in the learning resource list. There is the potential for differentiation by resource, length,
grouping, expected level of outcome, and degree of support by teacher, throughout the scheme of work. Timings for activities and feedback are left to the judgment of
the teacher, according to the level of the learners and size of the class. Length of time allocated to a task is another possible area for differentiation. Extension and
formative assessment activities are included where appropriate.
The units within this scheme of work are:
Unit 1: Introductory ideas and the price system
Unit 2: The price system in detail
Unit 3: Macroeconomic measurement, theory and inflation
Unit 4: International trade
Unit 5: International trade problems and policies
Unit 6: Basic economic ideas
Unit 7: The price system and the theory of the firm
Unit 8: Government intervention in the price system
Unit 9: Theory and measurement in the macroeconomy
Unit 10: Macroeconomic problems and policies
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Cambridge International AS and A Level Economics (US) 9275 – from 2014
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Learning objectives
Suggested teaching activities
Learning resources
The objectives indicate the
abilities and skills candidates
need to develop in relation to
each section of the syllabus.
The activities in each unit may be incorporated into standard
exposition of the subject content. The activities are intended to
encourage learner involvement.
Reference to textbooks:
Anderton refers to Economics (3rd edition) by A Anderton,
Bamford refers to Cambridge International AS Level and A Level
Economics Coursebook with CD-ROM by C Bamford and S Grant,
Gillespie refers to AS and A Level Economics Through Diagrams:
Oxford Revision Guides by A Gillespie.
Stanlake refers to Stanlake`s Introductory Economics (7th edition)
by S J Grant.
Teacher support
Teacher Support is a secure online resource bank and community forum for Cambridge teachers. Go to http://teachers.cie.org.uk for access to specimen and past
question papers, mark schemes and other resources for syllabus 9708 and for syllabus 9275 when they become available. We also offer online and face-to-face
training; details of forthcoming training opportunities are posted online.
An editable version of this scheme of work is available on Teacher Support. The scheme of work is in Word doc format and will open in most word processors in most
operating systems. If your word processor or operating system cannot open it, you can download Open Office for free at www.openoffice.org
Resources
The up-to-date resource list for this syllabus can be found at www.cie.org.uk.
Textbooks:
Bamford, C and Grant, S
Cambridge International AS and A Level Economics (2nd edition) Teacher’s Resource CD-ROM Cambridge University Press, UK 2010
ISBN: 9780521126656
Grant, S
Cambridge International AS and A Level Economics Revision Guide Cambridge University Press, India 2013 ISBN: 9781107661783
The two textbooks listed above are endorsed by Cambridge International Examinations for use with the Cambridge International AS and A Level Economics syllabus.
Anderton, A
Gillespie, A
Grant, S
Economics (3rd edition) Causeway Press, 2004 ISBN: 9781902796109
AS and A Level Economics Through Diagrams: Oxford Revision Guides Oxford University Press, 2009 ISBN: 9780199180899
Stanlake`s Introductory Economics (7th edition) Longman, 2000 ISBN: 9780582405486
Websites:
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Cambridge International AS and A Level Economics (9275) – from 2014
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This scheme of work includes website links providing direct access to internet resources. Cambridge International Examinations is not responsible for the accuracy or
content of information contained in these sites. The inclusion of a link to an external website should not be understood to be an endorsement of that website or the
site's owners (or their products/services).
The particular websites in the learning resource column were selected when the scheme of work was produced. Other aspects of the sites were not checked and only
the particular resources are recommended.
www.bized.co.uk
www.imf.org
www.jusbiz.org
www.oheschools.org
www.s-cool.co.uk
www.tutor2u.net
www.worldbank.org
www.wto.org
http://wps.pearsoned.co.uk/ema_uk_he_sloman_economics_6/
www.economicsonline.co.uk
Newspapers and magazines:
Business Week www.businessweek.com
The Economist www.economist.com
The Financial Times www.ft.com/home/uk
The Guardian www.guardian.co.uk
The Independent www.independent.co.uk
The Telegraph www.telegraph.co.uk
The Times www.timesonline.co.uk
Television:
BBC www.bbc.co.uk
CNNwww.cnn.com
www.bbc.co.uk/blogs/thereporters/robertpeston
www.bbc.co.uk/blogs/thereporters/stephanieflanders
Learners should also be encouraged to use appropriate newspapers, magazines and television programmes in their own country and region.
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Scheme of work – Cambridge International AS and A Level Economics (US) 9275
Unit 1: Introductory ideas and the price system
Recommended prior knowledge
This unit starts the course by introducing basic ideas and tools of analysis. Learners’ 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.
Teaching time
Based on a total time allocation of 360 guided learning hours for this Cambridge International AS and A Level course, it is recommended that this unit should take about
35 hours.
Learning objectives
Suggested teaching activities
Learning resources
Candidates should:
understand the context of
economics
Learners survey the week’s news items to establish economic content. This
can be done in small groups or as a whole class activity.
Bamford Introduction
Stanlake Chp 1
A useful tool for learners is the idea of an 'economist toolkit'. This is
essentially a few key ideas that can be used to help answer different
questions. www.economicshelp.org/macroeconomics/toolkit.html
Learners should be encouraged to use
appropriate newspapers, magazines and
television programmes in their own country and
region.
Whole class review past examination papers to establish the nature of
approach and content. Teacher provides past papers for learners to
discuss in small groups.
For past examination papers, mark schemes
and examiner reports go to Teacher Support at
http://teachers.cie.org.uk
Learners are asked to think about and suggest why/how the idea of a social
science, such as economics might be different from a natural science such
as chemistry.
Groups of learners survey press headlines to identify and contrast positive
Anderton Unit 45
Bamford Introduction
Gillespie p 1
Stanlake Chp 1
be aware of the skills involved
consider the ‘economist’s toolkit’
Candidates should:
distinguish between a positive and
normative statement
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Learning objectives
Suggested teaching activities
Learning resources
and normative statements.
www.tutor2u.net/
Positive and Normative Economics:
Candidates should:
understand the concept of the
margin and relate decisions to
marginal changes
Introduce and contrast marginal and average idea by use of numerical data
e.g. weekly film attendances, golf round scores or goals scored each game
by footballers.
Anderton Unit 47
Bamford Chp 9
Gillespie pp 27, 29 and 30
Stanlake Chp 13
www.s-cool.co.uk/a-level/economics
Costs and their curves
www.tutor2u.net/
Marginal Costs

Candidates should:
be familiar with the economist’s
classification of resources
Learners analyse inputs in contrasting production activities e.g.
manufacturing and farming activity.

apply the classification to economic
activities
Anderton Unit 2
Bamford Chp 1
Gillespie p 1
Stanlake Chp 5
www.bized.co.uk
Economics Topic 1, Introductory microeconomics
www.tutor2u.net/
Factors of Production
Candidates should:
understand the nature of economic
wants and resources and the
resulting economic problems
Learners draw up a list of their economic ‘needs’ and then produce a list of
their ‘economic wants’. Learners then asked to share their ideas with a
partner, then adapt and share with rest of class.
Anderton Unit 1
Bamford Chp 1
Gillespie pp 1 and 2
Stanlake Chp 1
understand the concept of
opportunity cost
Learners are required to produce a ‘mind map’
http://en.wikipedia.org/wiki/Mind_map which illustrates the connections
between the key economic terms explained and what we mean by the term
‘economics
www.bized.co.uk
Economics Topic 1, Introductory microeconomics
apply opportunity cost to different
Learners
www.oheschools.org
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Cambridge International AS and A Level Economics (9275) – from 2014
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Learning objectives
choices
Suggested teaching activities



analyse scarcity for individual, company and nation.
define opportunity cost.
apply opportunity cost to family e.g. holiday and government e.g.
public spending decisions.
Learning resources
Unit 1 The problems of health care
www.s-cool.co.uk/a-level/economics
Scarcity and Opportunity Cost
www.tutor2u.net/
Opportunity Cost
Scarcity
Candidates should:
understand the nature of the
production possibility curve
Teacher introduces plotting graphs of production possibility curves.
employ production possibility
curves (PPCs) to illustrate the basic
economic problem and opportunity
cost
Extension
Opportunity for advanced learners to explain different shapes of curves by
relating to changing/constant opportunity cost and explain why opportunity
costs might change.
interpret the production possibility
curve diagram
Analyse effects of range of changes moving between and within curves
Examine alternative shapes of curves and significance of movements.
Formative assessment based on class worksheet on production
possibility curves.
Candidates should:
recognise the drawbacks of barter
understand the functions and
characteristics of money and its
importance for economic progress
Role play exchange without money.
Learners analyse suitability of selected items to serve as money
highlighting weaknesses.
Anderton Unit 1
Bamford Chp 1
Gillespie pp 2 and 3
Stanlake Chp 2
www.bized.co.uk
Economics Topic 1, Introductory microeconomics
www.oheschools.org
Unit 1 The problems of health care
www.tutor2u.net/
Production Possibility Frontier
Shifts in the Production Possibility Frontier
Anderton Unit 82
Bamford Chp 1
Gillespie p 67
Stanlake Chp 7
www.bized.co.uk
Economics Topic 8, Money
www.tutor2u.net/
Money and its functions
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Learning objectives
Suggested teaching activities
Learning resources
Candidates should:
understand the nature, benefits and
limits of division of labour
Pin factory, Ford model T and automated production case studies – learner
research on division of labour within a selected organisation with report
back.
Anderton Unit 2
Bamford Chp 1
Stanlake Chp 6
contrast the operation of division of
labour in different settings
Class discussion of modern working conditions and motivation.
www.bized.co.uk
Economics Topic 1, Introductory microEconomics
www.bized.co.uk/virtual/dc/copper/index.htm
Topic 3, Firms and virtual developing country
copper field trip
Candidates should:
distinguish between absolute and
comparative advantage
Learners consider how this applies to individual’s employment.
Learners work numerical example and translate to production possibility
curve approach.
apply the principle to demonstrate
the benefits of division of labour
Anderton Unit 14
Bamford Chp 4
www.bized.co.uk
Economics Topic 11, International economics
and virtual developing country trade field trip
www.tutor2u.net/
Theory of Comparative Advantage
Comparative Advantage – Worked Examples
Candidates should:
understand the nature of individual
and market demand curves
analyse the factors which influence
demand curves
distinguish between a shift in and
movement along a curve
Learner observation of demand/price relationship, for example, the number
of cups of coffee they would purchase individually per week at different
prices. Then, assuming all members of the class constitute the market
demand for coffee, learners can construct a market demand curve and
survey factors underlying demand for specified products e.g. oil, holidays,
CDs, DVDs etc.
Anderton Unit 4
Bamford Chp 2
Gillespie pp 4, 5 and 6
Stanlake Chp 8
www.bized.co.uk
Economics Topic 2, Markets
Graph demand schedules and their movements.
www.oheschools.org
Unit 2 The free market approach
www.s-cool.co.uk/a-level/economics
The Demand Curve
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Learning objectives
Suggested teaching activities
Learning resources
www.tutor2u.net/
Theory of Demand
Candidates should:
understand the nature of individual
and market supply curves
analyse the factors which influence
supply curves
Whole class analyse changing supply conditions for different products
graph supply schedules and their movements. Teacher provides learners
with a market supply schedule and asks them to add this to their graph of
their market demand schedule
Anderton Unit 5
Bamford Chp 2
Gillespie pp 10, 11 and 13
Stanlake Chp 10
Learners use completed graphs to identify and discuss idea of market
equilibrium.
www.bized.co.uk
Economics Topic 2, Markets
show the effect of the introduction
of an indirect tax or subsidy
www.oheschools.org
Unit 2 The free market approach
distinguish between a shift in and
movement along a curve
www.s-cool.co.uk/a-level/economics
The Supply Curve
www.tutor2u.net/
Theory of Supply
Candidates should:
appreciate the need for ‘ceteris
paribus’ in supply and demand
analysis
Class considers range of objectives without assumption.
Anderton Units 4 and 5
Bamford Chp 2
Candidates should:
understand the setting of an
equilibrium price
Small groups discuss the operation of familiar market e.g. produce or
shares and study price behaviour in a commodity market. Learners plot
changes to equilibrium.
Anderton Unit 6
Bamford Chp 2
Gillespie pp 12 and 13
Stanlake Chps 11 and 12
use diagrams to represent
changing conditions
Learners analysis of given changes on equilibrium and interrelationships
between products with report back determining the price of a house
simulation (virtual learning arcade) the interrelationship between markets
simulation (virtual learning arcade) – www.bized.co.uk/virtual/index.htm .
identify the elements left
unchanged in the application of the
assumption
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Cambridge International AS and A Level Economics (9275) – from 2014
www.bized.co.uk/virtual/index.htm
Virtual Worlds: virtual learning arcade; virtual
developing country rural life field trip
10
Learning objectives
Suggested teaching activities
Learning resources
analyse the effects of changes in
variables
Extension
Advanced learners might be given the opportunity to examine more
demanding explanations of price equilibrium which incorporate a dynamic
analysis using cobweb theory.
www.oheschools.org
Unit 2 The Free Market Approach
apply the analysis to different
products and markets
recognise the relationships
between different products and
services e.g. joint demand and joint
supply
Candidates should:
understand the concept of
consumer and producer surplus
illustrate consumer and producer
surplus
recognise consumer and producer
surplus in diagrams
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Formative assessment using multiple-choice questions relating to supply
and demand analysis – ask learners to peer assess each other’s work and
discuss their answers in pairs.
Class discuss consumer behaviour and examine the demand curve
diagram.
In groups learners can discuss producer and consumer surplus and provide
alternative diagrams on worksheets – learners have to identify consumer
and producer surplus and explain their choice.
www.s-cool.co.uk/a-level/economics
The Equilibrium Price
Real World Applications
www.tutor2u.net/
Equilibrium Market Price
Anderton Unit 4
Bamford Chp 2
Gillespie p 23
Stanlake Chp 8
www.tutor2u.net/
Consumer Surplus
Extension
Advanced learners might be asked to explain what happens to consumer
and producer surplus when a price is fixed above/below the existing market
equilibrium price.
Cambridge International AS and A Level Economics (9275) – from 2014
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Scheme of work – Cambridge International AS and A Level Economics (US) 9275
Unit 2: The price system in detail
Recommended prior knowledge
The operation of demand and supply through the market mechanism.
Context
The unit concludes the microeconomic section of the course and introduces the notion of government intervention to improve the allocation of resources. This will be
used in dealing with both national and international macroeconomic problems.
Outline
After examining the concept of elasticity and demonstrating how price allocates resources, some failures of the price system are explained. Government analysis of and
policy on the failures lead on to a consideration of alternative economic systems and the problems of transition to a market economy.
Teaching time
Based on a total time allocation of 360 guided learning hours for this Cambridge International AS and A Level course, it is recommended that this unit should take about
55 hours.
Learning objectives
Suggested teaching activities
Learning resources
Candidates should:
define and calculate price, income
and cross elasticities of demand
Contrast demand behaviour for ‘necessities’ and ‘luxuries’

analyse the significance of demand curves with different slopes
and the limiting case curves

ask learners to form pairs to construct relevant graphs to
represent each of the limiting cases of price elasticity of demand
and price elasticity of supply

apply the elasticity formula to numerical data

examine and explain actual values for price and income and
cross elasticities
Anderton Units 8, 9, 10 and 11
Bamford Chp 2
Gillespie pp 7, 8 and 9
Stanlake Chp 9
explain the meaning and causes of
various elasticity values
establish the link between
elasticity, price and revenue
distinguish between normal and
inferior goods
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Analyse with diagrams the burden of taxation in different
elasticity positions

examine link between elasticity and advertising

elasticity simulations (virtual learning arcade)
www.bized.co.uk
Economics Topic 2, Markets; virtual learning
arcade
www.s-cool.co.uk/a-level/economics
Price Elasticity of Demand
Income Elasticity of Demand
Cross Price Elasticity of Demand
Cambridge International AS and A Level Economics (US) 9275 – from 2014
12
Learning objectives
Suggested teaching activities
appreciate the uses of demand
elasticity for government and
business
Candidates should:
define and calculate price elasticity
of supply
explain the meaning and causes of
various elasticity values
www.tutor2u.net/
Price Elasticity of Demand
Income Elasticity of Demand
Cross Price Elasticity of Demand
Apply the elasticity formula to numerical data:

interpret the significance of the slope of the supply curve

advanced learners could be introduced to extended work through
a demonstration of mathematical proof which explains why a
unitary elastic supply curve can be represented by a straight line
through the origin of the two axes.

analyse responsiveness of supply in different industries
apply elasticity of supply to different
production techniques
Candidates should:
explain the functions of price as a
signal in the use of resources
illustrate the impact of externalities
on market outcomes



analyse reactions of consumers and producers to given price
change and effect on allocation
construct flow chart of process
learners form groups and complete gapped worksheets on
elasticity – answers discussed in class
‘The Snickers Effect’ game at www.bized.ac.uk
can be used to revise many key issues relating to
elasticity discussed in this unit
Class analyse the elements of decisions e.g. private transport, night air
flights etc.
Groups of learners research local and national cases e.g. environmental
impacts
Graph external as well as private costs and benefits to highlight market
outcome.
Learners form groups and each group has to produce examples of
positive/negative externalities of production and consumption taken from
their own economy – followed by class discussion.
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Anderton Unit 9
Bamford Chp 2
Gillespie p 11
Stanlake Chp 10
www.s-cool.co.uk/a-level/economics
Price Elasticity of Supply
www.tutor2u.net/
Price Elasticity of Supply

Candidates should:
understand the effect of
consumption and production
decisions on third parties
provide examples of negative and
positive externalities
Learning resources
Cambridge International AS and A Level Economics (9275) – from 2014
Anderton Unit 15
Bamford Chp 2
Gillespie p 12
Stanlake Chp 11
www.oheschools.org
Unit 2 The free market approach
Anderton Unit 19
Bamford Chp 3
Gillespie pp 23, 24 and 25
Stanlake Chps 20 and 21
www.bized.co.uk
Economics Topic 5, Market failure; virtual
developing country aid field trip, wildlife field trip;
virtual learning arcade
www.jusbiz.org
The real price of cotton
13
Learning objectives
Suggested teaching activities
Learning resources
The real price of cotton activity at www.jusbiz.org/realcotton.html
www.oheschools.org
Unit 3 The case against the free market
www.s-cool.co.uk/a-level/economics
Externalities
www.tutor2u.net/
What are Externalities?
Positive Externalities
Candidates should:
distinguish between private,
external and social costs/benefits
and show how they are related
Learners analyse situations to make distinctions e.g. waste disposal,
modern agriculture methods.
Anderton Unit 19
Bamford Chp 3
Gillespie p 24
Stanlake Chp 20
Candidates should:
understand the features of costbenefit analysis (CBA)
Teacher presents then contrasts the basis of private and public decision
making and learners analyse a hypothetical case e.g. ban on smoking.
Anderton Unit 22
Bamford Chp 3
Gillespie p 61
Stanlake Chp 20
appreciate CBA as a method of
evaluating the impact of economic
actions and arriving at a policy
decision
Learners may study of actual case e.g. dam construction, transport
infrastructure spending.
Tackling traffic congestion simulation (see link to virtual learning arcade).
be aware of the basics of the CBA
method
www.bized.co.uk/virtual/vla/transport/index.htm
Virtual developing country aid field trip;
virtual learning arcade
www.tutor2u.net/
Cost Benefit Analysis
apply CBA to relevant cases
Candidates should:
understand the nature of public and
merit /demerit goods
identify examples of public and
merit/demerit goods
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Learners provide their definitions and examples of public, merit and demerit
goods and present and discuss in class or small groups.
Class debate practicality and desirability of private provision of public and
merit goods.
Anderton Unit 20
Bamford Chp 3
Gillespie pp 23 and 25
Stanlake Chp 21
www.s-cool.co.uk/a-level/economics
Public, Merit and Demerit Goods
Cambridge International AS and A Level Economics (9275) – from 2014
14
Learning objectives
Suggested teaching activities
Learning resources
www.tutor2u.net/
Public Goods
Merit Goods and Service
Candidates should:
describe the different methods of
government intervention in markets
link the methods to market failure
show how different methods
achieve their objective
recognise the problems and limits
of the methods
Teacher presents the use demand and supply analysis to show impact of
government action.
Learners view outcomes from different perspectives e.g. business,
government, consumer to identify side effects of policy.
Formative assessment based on ‘diagram game’ (described below)
learners form groups – one group draws diagram on whiteboard
representing positive/negative externality in consumption – next group has
to label this diagram – next group has to decide whether labeling is correct
and if not change it – final group decides whether changes are correct.
Anderton Unit 21
Bamford Chp 3
Gillespie p 26
Stanlake Chps 24 and 25
www.bized.co.uk
Economics Topics 2, Markets and 5, Market
failure; virtual developing country rural life field trip
www.s-cool.co.uk/a-level/economics
What is Market Failure?
What can be done about these Externalities?
www.tutor2u.net/
Introduction to Market Failure
Direct Regulation of Externalities
Correcting Positive Externalities
Candidates should:
have an understanding of the
problems of transition when central
planning in an economy is reduced
Learners should research a former centrally planned economy which is
going through a process of transition towards more of a free market, such
as Russia, Poland or the Czech Republic, and find out the various
problems which have been experienced and how they have been tackled.
Bamford, Chp 10, pp 192–200
The self-assessment task in Bamford (p 197) has some very interesting
questions on this topic.
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Cambridge International AS and A Level Economics (9275) – from 2014
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Scheme of work – Cambridge International AS and A Level Economics (US) 9275
Unit 3: Macroeconomic measurement, theory and inflation
Recommended prior knowledge
Understanding the distinction between micro and macro.
Context
The unit introduces the measurement of macroeconomic variables and sets up the first elements of international economic aspects.
Outline
The ways employment/unemployment and productivity are measured are examined and the structure of the balance of payments is set out. The construction of a price
index to measure inflation is explained before the causes and consequences of inflation itself are considered. The study of aggregate demand and aggregate supply is
introduced.
Teaching time
Based on a total time allocation of 360 guided learning hours for this Cambridge International AS and A Level course, it is recommended that this unit should take about
40 hours.
Learning objectives
Suggested teaching activities
Learning resources
Candidates should:
understand the idea of the labour
force
Learners form groups and analyse recent trends in employment and
unemployment in respective countries. Each group gives a presentation
outlining trends and answers questions from rest of class.
Anderton Units 29 and 72
Bamford Chp 5
Gillespie pp 76–79
Stanlake Chp 56
www.bized.co.uk
economics Topic 9, Unemployment and inflation
www.s-cool.co.uk/a-level/economics
Unemployment – some definitions
www.tutor2u.net/
Labour Market Participation Rates
Measuring Unemployment
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Cambridge International AS and A Level Economics (US) 9275 – from 2014
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Learning objectives
Suggested teaching activities
Learning resources
Long Term Unemployment
Candidates should:
be familiar with the format of
employment statistics and their
recent patterns and trends
Learners compare trends between economies
Candidates should:
know how unemployment is
measured and how it has behaved
Learners contrast different methods of measuring unemployment.
Formative assessment based on data response question on
unemployment statistics and trends.
www.tutor2u.net
AS macroeconomics
measuring employment and unemployment
www.economicsonline.co.uk
National economy
Macroeconomics
Measuring performance
Candidates should:
understand the meaning and
measurement of productivity
Learners make international comparisons of productivity and comparisons
over time.
Teacher produces a class worksheet on productivity and how it can be
increased.
Candidates should:
distinguish between exports and
imports, goods and services
Learners provided with simplified balance of payments accounts and
required to classify different trade and capital transactions.
Candidates should:
distinguish between trade and
capital flows
Groups of learners assemble balance of payments table from random items
and answer peer questions relating to their table.
Accelerate high growth business training review
and bonus – what you need to know:
http://accelerateprogramreview.com/acceleratehigh-growth-business-training-review-5-steps-toincrease-business-productivity-profit/
www.tutor2u.net
A2 macroeconomics
Balance of payments
www.bized.co.uk
International economics
balance of payments
Candidates should:
understand the structure of the
balance of payments account
V0.1 3Y09
Examine recent balance of payments accounts.
Cambridge International AS and A Level Economics (9275) – from 2014
17
Learning objectives
Suggested teaching activities
Learning resources
Formative assessment based on class worksheet on balance of payments
calculations.
Balance of payments (BOP):
www.investinganswers.com/financialdictionary/economics/balance-payments-bop2116
Candidates should:
analyse a balance of payments
account
Learners choose two economies and compare their balance of payments
accounts with their own country –- provide possible explanations for
differences.
represent exports and imports in
supply and demand diagrams
Learners are required to show graphically how exports and imports might
impact on supply of and demand for goods.
Candidates should:
understand the idea of a general
price level
Examine trends in inflation.
Inflation data:
http://inflationdata.com/Inflation/images/charts/In
flation_Trends/Inflation_Trends_chart.htm
Candidates should:
construct a weighted price index
and use it to measure price
changes
Construct student price index.
www.tutor2u.net
AS macroeconomics inflation using index
numbers
AS presentations on inflation
Candidates should:
be aware of the problems in
constructing, maintaining and
interpreting a price index
Calculate changes over time – teacher produces a class worksheet
Candidates should:
interpret the meaning of changes in
price data
Class looks at the contrast of changes in weights over time.
Learners required to identify possible changes in weights based on
changes in their own country’s economy over the last 100 years.
Candidates should:
define inflation
Class studies the case study of hyper-inflation e.g. Germany 1923 and
Zimbabwe 2008–2009, and contrast past instances of cost push, demand
pull and monetary inflation.
GCSE Weimar crisis of 1923:
www.bbc.co.uk/schools/gcsebitesize/history/mw
h/germany/crisis1923rev_print.shtml
Candidates should:
understand the shape and
determinants of aggregate demand
Learners need to have a good grasp of the diagrams; these are covered
well in Bamford (pp 219–222) and Gillespie (pp 81–83).
www.s-cool.co.uk/a-level/economics
Aggregate demand
Aggregate supply
V0.1 3Y09
Cambridge International AS and A Level Economics (9275) – from 2014
18
Learning objectives
Suggested teaching activities
Learning resources
(AD) and aggregate supply (AS)
The self-assessment tasks in Bamford (pp 221 and 222) and the data
question in Anderton (p 226) are very helpful.
www.tutor2u.net/
Aggregate Demand and Aggregate Supply
understand the significance of the
interaction of AD and AS in terms of
the determination of levels of
output, prices and employment
Formative assessment based on a compilation of multiple-choice
questions taken from past examination papers – answers discussed in
class. Access past papers at http://teachers.cie.org.uk
www.bized.co.uk
The AD and AS Model
Candidates should:
understand the terms describing
aspects of inflation
Class compares the effects of inflation from different viewpoints e.g.
borrowers, lenders, taxpayers and the government.
www.economicsonline.co.uk
Macroeconomic problems
inflation
Candidates should:
analyse the causes and
consequences of inflation
Whole class or learner groups examine links between inflation and
international competitiveness
Link between international competitiveness and
inflation:
www.economicshelp.org/blog/565/inflation/inflati
on-competitivenes/
Candidates should:
understand the shape and
determinants of aggregate demand
(AD) and aggregate supply (AS)
Learners need to have a good grasp of the diagrams; these are covered
well in Bamford (pp 219–222) and Gillespie (pp 81–83).
www.s-cool.co.uk/a-level/economics
Aggregate demand
Aggregate supply
understand the significance of the
interaction of AD and AS in terms of
the determination of levels of
output, prices and employment
Bamford, Chp 11, pp 219–222
Anderton, Units 33–35, pp 212–233
Stanlake, Chp 22, pp 268–278
Gillespie, pp 81–83
The self-assessment tasks in Bamford (pp 221–222) and the data question
in Anderton (p 226) are very helpful.
Formative assessment based on a compilation of multiple-choice
questions taken from past examination papers – answers discussed in
class. Access past papers at http://teachers.cie.org.uk
www.tutor2u.net/
Aggregate Demand and Aggregate Supply
www.bized.co.uk
The AD and AS Model
Bamford, Chp 11, pp 219–222
Anderton, Units 33–35, pp 212–233
Stanlake, Chp 22, pp 268–278
Gillespie, pp 81–83
V0.1 3Y09
Cambridge International AS and A Level Economics (9275) – from 2014
19
Scheme of work – Cambridge International AS and A Level Economics (US) 9275
Unit 4: International trade
Recommended prior knowledge
Comparative advantage, elasticity and the structure of the balance of payments.
Context
The unit sets the background for a consideration of the problems that arise from international trade and the policies governments may introduce to correct these
difficulties.
Outline
After establishing the basis of free trade, the forms and motives for protection are considered. The different types of economic integration are examined and the terms
of trade explained.
Teaching time
Based on a total time allocation of 360 guided learning hours for this Cambridge International AS and A Level course, it is recommended that this unit should take about
25 hours.
Learning objectives
Suggested teaching activities
Learning resources
Candidates should:
understand the application of
comparative advantage to
international trade
Class recap on the principle of opportunity cost and apply to
specialisation and international trade – this may be done as a quiz or
multiple-choice question exercise.
Anderton Unit 14
Bamford Chp 4
Gillespie pp 94 and 95
Stanlake Chp 47
Teacher explains the theories of absolute and comparative advantage
and provide supporting numerical examples.
Learners complete a worksheet with questions on comparative
advantage, specialisation and exchange, and then discuss responses.
In groups, learners identify any goods/services that they think might
allow their country to gain a comparative advantage – choices discussed
as a whole class activity.
www.bized.co.uk
Economics Topic 11, International economics;
virtual developing country trade field trip
www.s-cool.co.uk/a-level/economics
The Case for Free Trade – Absolute Advantage
The Case for Free Trade – Comparative Advantage
www.tutor2u.net/
The Theory of Comparative Advantage
V0.1 3Y09
Cambridge International AS and A Level Economics (US) 9275 – from 2014
20
Learning objectives
Suggested teaching activities
Learning resources
Comparative Advantage – Worked Examples
WTO International trade data and news
recognise the limits of the theory
In pairs learners examine the patterns of trade between countries to test
theory – learners research pattern of global trade based on
commodity/service group, for example primary, secondary and tertiary
and then compare this with the pattern demonstrated by their country –
class discuss the differences.
Extension
Advanced learners might be introduced to simplified version of
Heckscher-Ohlin model based on factor endowment.
Candidates should:
apply opportunity cost to
international trade
www.tutor2u.net
A Level macroeconomics
patterns of international trade
Heckscher-Ohlin model:
http://en.wikipedia.org/wiki/Heckscher–Ohlin_model
www.economicsonline.co.uk
A Level macroeconomics
patterns of international trade
Diagrams provided on whiteboard and learners are required to use these
to explain the relationship between comparative advantage, opportunity
cost and the benefits of international trade.
Comparative advantage and international trade:
www.tutor2u.net/economics/content/topics/trade/co
mparative_advantage.htm
Analyse geographical origin of purchases and give examples from own
country of perceived benefits of trade.
Anderton Unit 40
Bamford Chp 4
Gillespie pp 94–96
Stanlake Chps 47–48
interpret production possibility
curves in an international context
Candidates should:
recognise the benefits of free trade
www.bized.co.uk
Economics Topic 11, International economics;
virtual developing country trade field trip
www.s-cool.co.uk/a-level/economics
Why do countries trade?
The Case for Free Trade
Potential gains from trade:
www.tutor2u.net/economics/content/topics/trade/gai
ns_from_trade.htm
V0.1 3Y09
Cambridge International AS and A Level Economics (9275) – from 2014
21
Learning objectives
Suggested teaching activities
Candidates should:
define trade protection
Learners asked to discuss in groups and explain why governments
might decide to intervene in international trade – groups present to the
class and teacher lists reasons.
Learning resources
understand the motives for trade
protection
Candidates should:
know the different forms protection
can take
Compare nature of trade barriers in different economies.
Learners research cases of protection e.g. US tariffs and discuss
costs/benefits of measures – could form groups and each group locates
a measure adopted by their country and analyses success/failure.
Anderton Unit 40
Bamford Chp 4
Gillespie pp 95 and 96
Stanlake Chp 48
www.s-cool.co.uk/a-level/economics
The Case Against Free Trade
Protectionism – Barriers to International Trade:
http://papers.xtremepapers.com/Edexcel/Advanced
%20Level/Economics/Resources/A2_Protectionism.
pdf
Import Controls – The Economic Arguments:
www.tutor2u.net/economics/content/topics/trade/tra
de_barriers.htm
www.worldbank.org
World Bank Tariff and non tariff trade barrier data
Candidates should:
analyse the effects of trade
protection
Diagram of tariff to show price and output effects.
Candidates should:
define economic integration
Establish own or familiar economies’ status.
V0.1 3Y09
Extension
Advanced learners could be given opportunity to use this diagram to
show how the imposition of a tariff might result in a ‘deadweight welfare
loss’.
Anderton Unit 98
Bamford Chp 4
Gillespie pp 102–104
Stanlake Chp 64
Cambridge International AS and A Level Economics (9275) – from 2014
22
Learning objectives
Suggested teaching activities
Learning resources
www.bized.co.uk
Developing country trade field trip
Single Market:
www.tutor2u.net/economics/content/topics/europe/s
ingle_market.htm
Various regional economic groupings, e.g.:
www.aseansec.org
www.caricom.org
http.//europa.eu
Candidates should:
distinguish the different forms of
integration
Teacher directs learners to www.economicsonline.co.uk
Search for global economy and economic integration.
www.economicsonline.co.uk
Global economy
Trading blocs
Video economic integration
Learners are then required to provide their own definition of integration,
for class discussion, then form groups and construct a diagram
illustrating the different stages of integrations.
Candidates should:
be aware of recent trends in
integration
Survey changes in world regional groupings.
Candidates should:
understand trade creation and
diversion
Learners form groups – each group gives a five minute presentation on
trade creation and then a five minute presentation on trade diversion –
class vote for best presentations.
Candidates should:
define the terms of trade
Numerical example – learners then asked to identify factors which they
think will cause changes in the terms of trade – learners need to explain
their choices.
Anderton Unit 14
Bamford Chp 4
Gillespie p 95
Stanlake Chp 49
www.bized.co.uk
Developing country trade field trip
V0.1 3Y09
Cambridge International AS and A Level Economics (9275) – from 2014
23
Learning objectives
Suggested teaching activities
Learning resources
Terms of Trade:
www.tutor2u.net/economics/content/topics/trade/ter
ms_of_trade.htm
World Bank Annual report:
http://web.worldbank.org/WBSITE/EXTERNAL/EXT
ABOUTUS/0,,contentMDK:20574164~menuPK:833
6884~pagePK:51123644~piPK:329829~theSitePK:
29708,00.html
Candidates should:
calculate changes in the terms of
trade
Learners examine the meaning of favourable/unfavourable in this
context.
Candidates should:
be familiar with the vocabulary of
changes in the terms of trade
Learners link changes in the terms of trade to elasticity and the balance
of payments.
Candidates should:
analyse the causes and effects of
changes in the terns of trade
Groups investigate the changes in terms of trade for different economies
e.g. developing versus developed.
Candidates should:
be aware of recent trends and their
consequences
Numerical example taken from learners own country – learners analyse
consequences of these changing trends for own country.
Formative assessment based on a multiple-choice question quiz at the
end of the section – answers discussed in class.
V0.1 3Y09
Cambridge International AS and A Level Economics (9275) – from 2014
24
Scheme of work – Cambridge International AS and A Level Economics (US) 9275
Unit 5: International trade problems and policies
Recommended prior knowledge
The balance of payments, government intervention in trade and the price mechanism.
Context
The unit completes the consideration of international trade by considering the problems which arise and how governments attempt to solve them.
Outline
The unit identifies the different types of exchange rate and explains how the exchange rate is set. The factors which cause changes in the exchange rate and the effects
of changes are examined. The meaning, causes and results of a balance payments disequilibrium, are considered before analysing the methods governments may use
to correct the disequilibrium and stabilise exchange rates.
Teaching time
Based on a total time allocation of 360 guided learning hours for this Cambridge International AS and A Level course, it is recommended that this unit should take about
25 hours.
Learning objectives
Suggested teaching activities
Learning resources
Candidates should:
understand the different measures
of the exchange rate
Compare the different measures of the exchange rate to show their
particular nature – learners research the differences between ‘trade
weighted index’ ‘real exchange rate’ and effective exchange rate’ findings
are then presented in class and relative importance of each measure
discussed in class.
Anderton Units 39, 93, 94 and 95
Bamford Chp 6
Gillespie pp 88, 89 and 90
Stanlake Chp 51
www.bized.co.uk
Economics Topic 11, International economics;
virtual developing country trade field trip; virtual
learning arcade
www.s-cool.co.uk/a-level/economics
What is an Exchange Rate?
How is the Exchange Rate determined?
Exchange Rate Systems
V0.1 3Y09
Cambridge International AS and A Level Economics (US) 9275 – from 2014
25
Learning objectives
Suggested teaching activities
Learning resources
www.tutor2u.net/
Introduction to Currency Valuation
Global Foreign Exchange Markets
Fixed and Floating Exchange Rates
Candidates should:
explain how exchange rates are set
under floating, fixed and managed
systems and be aware of the
prevalence of different systems
Teacher explains that an exchange rate can be determined by market
forces and an equilibrium price can be determined just like any commodity
– key difference being the price is measured in terms of another currency.
Candidates should:
show the setting of exchange rates
in supply and demand diagrams
Teacher explains and presents the concept of a ‘floating exchange rate’ –
learners then asked to list any factors which might affect the demand for
supply of currency.
Learners are given price and supply and demand for currency data and
required to plot graphs and identify equilibrium price (exchange rate).
http://wps.pearsoned.co.uk/ema_uk_he_sloman
_economics_6/
Chp 24 slides plus explanation
evaluate the alternative systems
Candidates should:
analyse the factors which affect the
exchange rate
Apply influences via demand and supply analysis to show changes in
equilibrium.
Class worksheet which requires learners to predict how changes in
economic circumstances, particularly the balance of payments, might affect
a country’s exchange rate.
Extension
Questions can build in different degrees of difficulty to challenge more
advanced learners.
Candidates should:
show how fluctuations in the
exchange rate impact upon the
economy
Research recent trends in local exchange rate and analyse the links to the
real economy, prices and employment.
Candidates should:
show how a government may
influence the rate of exchange
Use demand and supply analysis to show impact of foreign exchange
market intervention explain the idea of ‘fixed exchange rates’.
V0.1 3Y09
Cambridge International AS and A Level Economics (9275) – from 2014
Anderton Unit 39
Bamford Chp 6
Gillespie p 90
26
Learning objectives
Suggested teaching activities
Learning resources
Stanlake Chp 51
Learners discuss factors that might lead to a government’s decision to fix
exchange rates.
www.s-cool.co.uk/a-level/economics
The Marshall-Lerner Condition
Economic Effects of a Depreciating Currency:
http://tutor2u.net/economics/content/topics/exch
angerates/depreciation.htm
Economic Effects of a Strong Currency:
www.tutor2u.net/economics/content/topics/exch
angerates/econ_effects.htm
Candidates should:
be familiar with the Marshall-Lerner
condition
Teacher provide numerical example of Marshall-Lerner condition.
Candidates should:
evaluate the effectiveness of
exchange rate policy
Learners judge the policy against checklist of desirable qualities and
assess suitability with respect to own economy.
Learners asked to decide whether the Marshall-Lerner condition might
suggest that a formal devaluation of the currency in their own country would
help to solve a balance of payments deficit.
Marshall-Lerner condition:
http://en.wikipedia.org/wiki/Marshall–
Lerner_Condition
Ask learners to research the potential impact of a change (in both
directions) of their country’s exchange rate on its key macroeconomic
indicators.
Learners research and present their findings to the whole class.
Extension
Introduce the J curve effect and provide opportunity for advanced learners
to explain this potential effect.
Data response question based on exchange policy – answers discussed in
class.
Candidates should:
understand the meaning of
V0.1 3Y09
Teacher presents and explains the concepts of equilibrium and
disequilibrium.
Cambridge International AS and A Level Economics (9275) – from 2014
Anderton Units 30 and 96
Bamford Chp 6
27
Learning objectives
Suggested teaching activities
Learning resources
equilibrium and disequilibrium in the
balance of payments
Learners study their own country’s balance of payments figure over time
and identify why balance of payments are likely to be in disequilibrium.
Gillespie pp 92 and 93
Stanlake Chp 61
www.bized.co.uk
Developing country trade field trip
www.imf.org
World Economic Outlook and balance of
payments data
www.s-cool.co.uk/a-level/economics
Problems of Balance of Payments Disequilibria
Candidates should:
understand how a disequilibrium
may arise, analyse the effects of a
disequilibrium on the economy and
its position globally
Learners form groups, examine the USA balance of payments – identify the
extent of the disequilibrium and analyse the effect of this on the USA
economy and the global economy – learners given time to carry out
research and each group will give a presentation using power point slides –
each group presentation assessed by teacher and rest of the class.
Compare economic characteristics and performance of surplus and deficit
countries discussion on the problems of running a deficit.
Learners look at a case study of a deficit country followed by class
questions.
Candidates should:
understand the different policy
approaches
Teacher produces a grid to contrast nature, targets, advantages and
disadvantages of the different policies and learners form groups and each
group completes grid – class discussion.
Anderton Unit 96
Bamford Chp 7
Gillespie pp 90 and 93
Stanlake Chp 61
www.bized.co.uk
Economics Topic 11, International economics;
virtual developing country trade field trip
www.imf.org
World Economic Outlook
V0.1 3Y09
Cambridge International AS and A Level Economics (9275) – from 2014
28
Learning objectives
Suggested teaching activities
Learning resources
www.s-cool.co.uk/a-level/economics
How does a government reduce a balance of
payments deficit?
Government policy towards the Balance of
Payments:
www.tutor2u.net/economics/revision-notes/asmacro-balance-of-payments.html
Candidates should:
show how demand management,
supply side and exchange rate
policies operate to correct a
balance of payments disequilibrium
Learners form groups and judge the policies against checklist of desirable
qualities.
Candidates should:
evaluate the effectiveness of the
different policies used to improve
the balance of payments
Learners produce grid to contrast nature, targets, advantages and
disadvantages of the different policies and decide which they think might be
the most effective.
Candidates should:
comment on the possible conflicts
between policy objectives on
inflation, balance of payments and
the exchange rate
Learners to debate the proposition that ‘There is never a conflict between
low inflation, a strong balance of payments and a high exchange rate’.
V0.1 3Y09
Cambridge International AS and A Level Economics (9275) – from 2014
Bamford (Second edition) p 269
29
Scheme of work – Cambridge International AS and A Level Economics (US) 9275
Unit 6: Basic economic ideas
Recommended prior knowledge
This unit builds on the basic economic ideas and in particular the concept of economic efficiency.
Outline
The unit considers the idea of economic efficiency in terms of both productive and allocative efficiency.
Teaching time
Based on a total time allocation of 360 guided learning hours for this Cambridge International AS and A Level course, it is recommended that this unit should take about
10 hours.
Learning objectives
Suggested teaching activities
Learning resources
Candidates should:
understand the concept of efficient
or optimum resource allocation
Bamford (p 129) has a useful self-assessment task on the problems arising
from the increasing demand for timber.
Economic efficiency:
www.tutor2u.net/economics/content/topics/co
mpetition/efficiency.htm
Learners should then try and find other examples, in the newspapers and on
the internet, of scarce resources not being used in an optimum way; it would
be especially useful if learners could find local examples in their own
countries. They could then give a presentation to the group on their findings
and this should generate a useful discussion of why efficient resource
allocation is so important, given the scarcity of resources, leading to an
informed analysis and evaluation of the concept.
Candidates should:
understand the meaning of
productive efficiency
V0.1 3Y09
Bamford, Chp 8, pp 128–129
Anderton, Unit 16, p 100
Stanlake, Chp 19, pp 180–181
Learners should be able to use a production possibility curve to show the
difference between a position on the curve and one inside it; Bamford (p
130), Anderton (p 101) and Stanlake (p 180) all have clear examples of this.
Questions 1 (p 100) and 3 (a) (p 102) in Anderton should help learners gain a
clearer understanding of the concept.
The Production Possibility Curve and
Economic Efficiency:
http://tutor2u.net/economics/content/topics/intr
oduction/production_possibility_frontiers.htm
This should then enable learners to understand and discuss the conditions
which are necessary for it to exist.
Bamford, Chp 8, pp 130–131
Anderton, Unit 16, pp 100–101
Stanlake, Chp 19, pp 180–181
Gillespie, p 34
Cambridge International AS and A Level Economics (US) 9275 – from 2014
30
Learning objectives
Suggested teaching activities
Learning resources
Candidates should:
understand the meaning of
allocative efficiency and be able to
compare and contrast it with
productive efficiency
The conditions for a Pareto optimum outcome should be explained.
Bamford, Chp 8, p 132
Anderton, Unit 16, pp 101–102
Stanlake, Chp 19, pp 180–181
Gillespie, p 34
Learners should be able to draw a diagram of perfect competition to show
P=MC, as in Bamford (p 130) and decide whether this would constitute a
Pareto optimum outcome.
Extension
Advanced learners might be introduced to the theory of Second Best and
reminded of second best example relating to a negative externality created
by a monopoly firm and how government intervention might address this
problem.
Questions 2 (p 101) and 3 (b) (p 102) of Anderton should prove helpful.
Formative assessment
The self-assessment tasks in Bamford (p 132) will be useful as a way of
concluding the unit and assessing if the concepts have been fully
understood.
A time constrained essay 9708 Paper 42 June 2012 question 7 written in
class. Essays then marked in class and then discussed.
V0.1 3Y09
Cambridge International AS and A Level Economics (9275) – from 2014
For access to 9708 past question papers go to
Teacher Support at http://teachers.cie.uk
31
Scheme of work – Cambridge International AS and A Level Economics (US) 9275
Unit 7: The price system and theory of the firm
Recommended prior knowledge
Previous work on the price system and parts on efficiency follow on from the previous unit (Unit 6).
Context
This unit applies some of the ideas of economic efficiency, and takes further the ideas on the price system. It is also crucial to the understanding of why governments
might need to intervene in the price system.
Outline
The material starts with price, marginal utility theory and budget lines and then goes on to look at short-run and long-run production functions, the distinction between a
firm and an industry, the objectives of firms, the different market structures and an assessment of the conduct and performance of firms. It also looks at reasons for the
survival of small firms and for the growth of firms. Finally, it looks at the demand for and the supply of labour and the determination of wages, including the role of trade
unions and the government.
Teaching time
Based on a total time allocation of 360 guided learning hours for this Cambridge International AS and A Level course, it is recommended that Unit 7 should take about
60 hours.
Learning objectives
Suggested teaching activities
Learning resources
Candidates should:
understand the Law of Diminishing
Marginal Utility and its relationship
to the derivation of an individual
demand schedule and curve
Learners think of examples where marginal satisfaction may decline as more
units of a good are consumed, such as a hamburger, an ice cream or a bar
of chocolate.
www.tutor2u.net/
Consumer Choice and Utility
Candidates should:
have an understanding of the equimarginal principle
Learners need to understand the MU/P formula; the second self-assessment
task in Bamford (p 135) is very useful.
V0.1 3Y09
The first self-assessment task in Bamford (p 135) and the table and figures in
Stanlake (p 65) are helpful in showing learners the distinction between total
and marginal utility. This should lead on to a discussion of why economists
need to try and measure the level of happiness or satisfaction that a person
receives from the consumption of a good.
Cambridge International AS and A Level Economics (US) 9275 – from 2014
Bamford, Chp 9, pp 134–135
Anderton, Unit 69, p 452
Stanlake, Chp 8, pp 65–67
Gillespie, p 6
Bamford, Chp 9, p 135
Stanlake, Chp 8, p 67
Gillespie, p 6
32
Learning objectives
Suggested teaching activities
Candidates should:
have an awareness of the
limitations of marginal utility theory
Learners need to consider how difficult it is to try and measure the level of
happiness or satisfaction that a person receives from the consumption of a
good; they should think of some possible examples.
Candidates should:
have an understanding of budget
lines and of the income and
substitution effects of a price
change
Learners need to be able to construct a budget line to show the possible
combinations that can be purchased with a given sum of money; it should be
remembered, however, that indifference curves have been removed from the
syllabus.
Learning resources
Bamford, Chp 9, pp 135–136
Anderton, Unit 10, p 67
Stanlake, Chp 8, pp 64–65
Gillespie, p 5
The table and figures and the two self-assessment tasks in Bamford (p 136)
are helpful in enabling learners to understand the income and substitution
effects of a price change.
The income and substitution effect is given a good treatment in Anderton (p
67) and table 10.2 and question 2 on the same page are useful; the
treatment of this topic is also very good in Gillespie (p 5).
Extension
Advanced learners might be introduced to the Revealed Preference
approach to examining income and substitution effects.
Candidates should:
have an understanding of the shortrun production function, including
fixed and variable factors of
production, total product, average
product and marginal product
Learners need to be able to draw diagrams from data given which show
changes in marginal and average product.
www.tutor2u.net/
Short-run Production
The data question in Anderton on holiday cottages (p 318) would help to
reinforce understanding of the concepts of fixed and variable. costs
Bamford, Chp 9, pp138–139
Anderton, Unit 46, pp 304–306
Anderton, Unit 48, pp 315–318
Candidates should:
understand the Law of diminishing
returns or Law of variable
proportions
The data questions in Anderton (p 308) on diminishing returns in the fishing
industry are useful and should help learners to understand the concept.
www.tutor2u.net/
Law of Diminishing Returns
Stanlake, Chp 37, pp 342–346
Gillespie, p 28
The information on diminishing returns in agriculture in Anderton (pp 317–
318) is also helpful and should stimulate discussion and develop analytical
skills.
V0.1 3Y09
Cambridge International AS and A Level Economics (9275) – from 2014
www.s-cool.co.uk/a-level/economics
The Law of Diminishing Marginal Returns
33
Learning objectives
Suggested teaching activities
Learning resources
Class worksheet: learners complete blank table relating to output, average
product and marginal product – then given additional information regarding
variable and fixed costs – average total costs calculated and graph plotted
illustrating effect of diminishing marginal returns on cost curves.
Candidates should:
understand the long-run production
function and the concept of returns
to scale
Learners need to understand, and be able to distinguish between, the
concepts of increasing, constant and decreasing returns to scale; question 5
in Anderton (p306) is useful in helping them to understand these terms.
Anderton also has a useful example of increasing returns at petrol stations (p
307).
Bamford, Chp 9, p139 (excluding isocosts and
isoquants)
Anderton, Unit 46, pp 306–308
Stanlake, Chp 37, pp 346–347
Gillespie, p 32
The data response questions in Stanlake (p 349) are also helpful.
Candidates should:
understand how an economist’s
definition of costs would be different
from that of an accountant
Question 1 in Anderton (p 309) and question 5 (a) and (b) (p 312) are good
on the distinction between the two types of costs. It is
important to stress that normal profits assume that opportunity costs are part
of total costs – this is the key distinction between economist’s definition of
costs and accountant’s definition.
www.bized.co.uk
Production
Measuring the Costs of Production:
www.tutor2u.net/economics/content/topics/bus
economics/cost_measures.htm
A numerical example illustrating the above could be provided.
www.s-cool.co.uk/a-level/economics
Costs and their Curves
Anderton, Unit 47, pp 309–312
Candidates should:
be able to distinguish between
marginal cost and average cost
and, in the short-run cost function,
between fixed costs and variable
costs
V0.1 3Y09
Learners should be able to draw these cost curves; there are useful
examples in Bamford (pp 152–153) and Stanlake (pp 123–126).
Cambridge International AS and A Level Economics (9275) – from 2014
Bamford, Chp 9, pp 151–152
Stanlake, Chp 13, pp 122–126
34
Learning objectives
Suggested teaching activities
Learning resources
Candidates should:
be able to explain the shape of the
SRAC curve
Gillespie is particularly good on the concepts of marginal, average and total
costs (pp 27–30).
Gillespie, pp 27–30
Candidates should:
understand the long-run cost
function and be able to explain the
shape of the LRAC curve
Learners need to be able to draw the appropriate diagrams; there are
examples in Anderton (p 319), Stanlake (pp 127–129) and Gillespie (pp 31–
32).
www.tutor2u.net/
Long Run Costs of Production
www.bized.co.uk
Economies of Scale
www.s-cool.co.uk/a-level/economics
Economies of Scale
www.tutor2u.net/
Diseconomies of Scale
Bamford, Chp 9, pp 152–154
Anderton, Unit 49, pp 319–324
Stanlake, Chp 13, pp 126–129
Gillespie, pp 31–32
Candidates should:
understand both internal and
external economies of scale
recognise the relationship between
economies of scale and decreasing
costs
Candidates should:
understand the relationship
between elasticity and marginal,
average and total revenue for a
downward-sloping demand curve
V0.1 3Y09
Learners should try and find examples in newspapers of firms which are
aiming to benefit from economies of scale, perhaps as a result of a merger,
such as in the banking or airline industries; they should then report back to
the group, identifying the types of economy of scale discovered.
There are some useful questions on the supermarket Walmart taking over
Asda in Anderton (p 324).
Learners need to understand that PED will vary along the length of a demand
curve; there are diagrams showing this in Bamford (p160) and Gillespie (p 8).
www.tutor2u.net/
Business Revenue and Turnover
Teacher provides learners with price quantity tables plus a blank total
revenue table – learners complete total revenue table – learners divide graph
into two halves and plot price against question (d) in top half and total
revenue against question (d) in bottom half – learners then required to
calculate point elasticity at given prices in top diagram.
www.s-cool.co.uk/a-level/economics
Revenues and their Curves
Cambridge International AS and A Level Economics (9275) – from 2014
Bamford, Chp 9, pp159–160
Anderton, Unit 47, p 311
35
Learning objectives
Candidates should:
be able to distinguish between the
concepts of a firm and an industry
Suggested teaching activities
Learning resources
Extension
Advanced learners given opportunity to use graphs to explain relationships
between price elasticity of demand, changes in price and changes in total
revenue.
Stanlake, Chp 9 pp 78–79
Gillespie, p 8
Learners need to consider the concept of the industrial concentration ratio;
they should then research different industries, comparing the concentration
ratios, and report back to the group.
Bamford, Chp 9, p 161
Anderton, Unit 51, pp 336–337
Stanlake, Chp 45, p 427
Gillespie, p 44
There are some examples in Anderton (pp 336–337).
Candidates should:
understand the traditional objective
of a firm, profit maximization
be able to distinguish between
normal and abnormal profit
Candidates should:
have an awareness of other
possible objectives of a firm
Each learner should choose a firm and research it to find out what its
declared objectives are; this could be done on the internet and through any
literature produced by the firm, such as the annual report and learners should
try and focus on local firms in their own country.
The learner could then give a presentation to the rest of the group using
power point slides.
The profit maximising condition is crucial and learners need to be able to
analyse this. There are some useful case studies on Rentokil (Stanlake, p
341) and Chefaid (Bamford, p 163).
www.s-cool.co.uk/a-level/economics
Profit
www.tutor2u.net/
Measuring Business Profits
Alternatives to Profit Maximisation Theories
Profit Maximisation and Sales Revenue
Bamford, Chp 9, pp 161–163
Anderton, Unit 50, pp 325–331
Stanlake, Chp 36, pp 336–341
Gillespie, p 46
Anderton is very good on the goals of firms (pp 325–331), including
behavioural theories, and there is some good material on the role of the
shareholder and on stakeholder power.
Candidates should:
understand the structure of markets
as explained by the number of
buyers and sellers, the nature of
the product and information and the
degree of freedom of entry
The competition road map in Bamford (p165) is a very helpful starting point.
The learners could then work in groups, each group concentrating on one
particular market structure; within the group, each learner should try and find
out information about one or two firms to discover the characteristics of the
market structure.
The groups would then report back to the whole class, leading to a
discussion of the different types of market structure.
V0.1 3Y09
Cambridge International AS and A Level Economics (9275) – from 2014
www.s-cool.co.uk/a-level/economics
Market Structure I
Market Structure II
www.tutor2u.net/
Gains from Competitive Markets and Industries
Long Run Equilibrium under Competition
Sources of Monopoly Power
Oligopolistic Markets
36
Learning objectives
Suggested teaching activities
Learning resources
Economics of Contestable Markets
Bamford, Chp 9, pp 164–179
Candidates should:
understand the features of the
different market structures: perfect
competition, monopoly,
monopolistic competition and
oligopoly
There are some interesting case studies in the various textbooks, such as
trains (Anderton, pp 355–356), football clubs (Anderton, p 356) and soft
drinks (Stanlake, pp 425–426).
Anderton, Unit 51, pp 332–337
Anderton, Units 53–56, pp 343–366
Anderton, Unit 58, pp 372–376
Stanlake, Chps 41–45, pp 384–439
Gillespie, pp 35–43
Candidates should:
Understand and apply the concept
of a contestable market
Learners brainstorm a list of 20 industries and then classify them into
contestable and non-contestable markets.
Bamford (second edition) pp116-7
Anderton pp372-6
Candidates should:
have an understanding of the
conduct of firms in terms of pricing
policy and non-price policy. This
should include price discrimination,
price leadership models and mutual
interdependence in the case of
oligopolies
Learners should look in newspapers and magazines for examples of different
prices charged for goods and services and report their findings back to the
rest of the group; this should lead to a useful discussion and evaluation of
different pricing policies.
www.tutor2u.net/
Pricing Strategies and Company Objectives
Price Discrimination under Monopoly
Learners should try and find examples of price discrimination, such as in
transport and telephone services. They should also look for examples in
newspapers and magazines of other ways, apart from price, in which firms
compete.
Bamford, Chp 9, pp 164–179
Anderton, Unit 51, pp 332–337
Anderton, Units 53–56, pp 343–366
Anderton, Unit 65, pp 420–425
Stanlake, Chps 41–45, pp 384–439
Gillespie, pp 35–43
Anderton is very good on price fixing and collusion (pp 420–425) and there is
a useful section on OPEC with some data response questions which should
help develop learners` understanding of this topic.
Candidates should:
have an understanding of the
performance of firms in terms of
output, profits and efficiency
Each learner researches a firm on the internet and through published
information, such as the annual report, to discover as much information as
possible on its output, profits, efficiency, pricing and possible links with other
firms; a lot of information can be obtained from newspapers and magazines.
Bamford, Chp 9, pp 164–179
Anderton, Units 53–56, pp 343–376
Stanlake, Chp 45, pp 427–439
Gillespie, p 44
The learner then reports back to the group on the information obtained.
V0.1 3Y09
Cambridge International AS and A Level Economics (9275) – from 2014
37
Learning objectives
Suggested teaching activities
Learning resources
Candidates should:
be able to make comparisons
between firms with regard to
economic efficiency, barriers to
entry, price competition, non-price
competition and collusion
Formative assessment might use a compilation of multiple-choice questions
on the theory of the firm taken from part past papers – answers discussed in
class.
For access to 9708 past papers and other
secure online support materials go to Teacher
Support at
http://teachers.cie.org.uk/
Candidates should:
understand why small firms can
survive
Learners should choose a small firm and try to find out why it has remained
small and what advantages this might give it over a larger firm; they should
then report back to the group. This should lead to a useful discussion on why
small firms can survive.
www.bized.co.uk
Survival of the Small Firm
Candidates should:
have an understanding of the
reasons for the growth of firms
Learners should also research a firm that has grown in order to try and
discover the reasons for such growth and then give a presentation to the
group on that firm; Anderton has the example of Ford and Kwik–Fit (pp 418–
419).
Anderton, Unit 64, pp 413–419
Candidates should:
understand the meaning of, and the
factors affecting, the demand for
labour
Learners should consider examples of derived demand so that they show
that they have understood the concept. They should work in groups and
consider the various factors that would influence the demand for labour, both
generally and in particular occupations, and then report back to the whole
class.
www.s-cool.co.uk/a-level/economics
The Demand for Labour
There is an interesting example of the demand for workers in banking in
Anderton (pp 466–467).
Candidates should:
have an understanding of the
derivation of an individual firm’s
demand for a factor using marginal
revenue product
V0.1 3Y09
Bamford, Chp 9, pp 154–159
Anderton, Unit 38, p 255
Stanlake, Chp 40, pp 371–382
Gillespie, p 45
Bamford, Chp 9, pp 141–142
Anderton, Unit 21, pp 462–467
Stanlake, Chp 17, pp 161–162
Gillespie, p 47
Learners complete worksheet tables calculating ARP and MRP and then plot
graphs of both – discuss relationship between ARP and MRP.
Learners should try and think of examples where it might not be very easy to
calculate the MRP of a worker.
Cambridge International AS and A Level Economics (9275) – from 2014
38
Learning objectives
Suggested teaching activities
Learning resources
Candidates should:
understand the meaning of, and the
factors affecting, the supply of
labour.
Learners should work in groups and consider the various factors that could
affect the supply of labour; they should think of the different reasons why
people work and report back to the whole class.
www.s-cool.co.uk/a-level/economics
The Supply of Labour
This should lead to an interesting discussion and evaluation of why people
work, with a stress on both monetary and non-monetary factors.
www.tutor2u.net/
Supply Side Policies for the Labour Market
www.bized.co.uk
The Labour Supply Curve
Bamford, Chp 9, pp 142–144
Anderton, Unit 72, pp 468–478
Stanlake, Chp 17, pp 162–170
Gillespie, p 47
Candidates should:
understand how wages are
determined under free market
forces (competitive product and
factor markets).
Each learner should choose an occupation e.g. nurse, solicitor, teacher,
sales assistant, waitress, sports stars etc and research the wages that
operate in that industry; this should be followed by a presentation by each
learner and this should lead to a useful class discussion and analysis of why
there are such wide wage differentials in an economy e.g. higher pay for risktaking, working in poor condition and having to work unsocial hours. .
An interesting topic for discussion would be the differences in male/female
earnings in developed and developing countries and whether these had
narrowed over time; this would reinforce skills of application.
www.tutor2u.net/
Equilibrium Wages
Trade Unions
Economic Effects of the National Minimum
Wage
Wage Differences between Occupations
Economic Rent and Transfer Earnings
www.s-cool.co.uk/a-level/economics
The Equilibrium Wage
Trade Unions
The Minimum Wage
www.bized.co.uk
The Minimum Wage
Bamford, Chp 9, pp 148–150
Anderton, Units 73–75, pp 479–505
Stanlake, Chp 18, pp 170–178
Stanlake, Chp 22, pp 206–216
Gillespie, pp 48–50
V0.1 3Y09
Cambridge International AS and A Level Economics (9275) – from 2014
39
Learning objectives
Suggested teaching activities
Learning resources
Candidates should:
have an understanding of the role
of trade unions and government in
wage determination.
Learners need to consider the role of trade unions in the presentation; there
is a lot of useful information on trade unions in Anderton (pp 493–496).
Trade Union protection:
www.tutor2u.net/economics/content/topics/lab
ourmarket/pay_differences.htm
Learners prepare for wage negotiation role play – case study material
provided in advance.– learners form groups to represent employers, trade
unions, government, other businesses that might be affected by the dispute–
each group presents and rest of learners vote which group of negotiators
they would support and justify their choice.
Monopsony:
http://en.wikipedia.org/wiki/Monopsony
Extension
Opportunities for advanced learners to introduce economic theory, for
example, monopsony, to support their case.
Candidates should:
understand why wage differentials
exist in an economy and they
should have an awareness of the
concepts of economic rent and
transfer earnings
V0.1 3Y09
Consideration also needs to be given to an analysis of the role of
government in wage determination; this would be a good opportunity to have
a debate on the arguments for and against government intervention, such as
through a national minimum wage.
Cambridge International AS and A Level Economics (9275) – from 2014
40
Scheme of work – Cambridge International AS and A Level Economics (US) 9275
Unit 8: Government intervention in the price system
Recommended prior knowledge
This unit builds on the material covered on government intervention in the price system, the concept of efficiency and the existence of monopolistic elements in an
economy.
Context
This unit follows on from the previous one (Unit 7), the price system and theory of the firm, especially in terms of a critical examination of the different market structures,
the possible sources of market failure and the existence of market imperfections. It considers the microeconomic policies of government before going on to look at
government macroeconomic policies in the remaining units.
Outline
This unit considers the possibilities of market failure and market imperfections and goes on to look at the policies which could be adopted to try and correct these,
including an analysis of the objectives of government microeconomic policy. Finally, the concept of privatisation is considered.
Teaching time
Based on a total time allocation of 360 guided learning hours for this Cambridge International AS and A Level course, it is recommended that Unit 8 should take about
20 hours.
Learning objectives
Suggested teaching activities
Learning resources
Candidates should:
understand the sources of market
failure.
Learners should revisit Unit 3 of this scheme of work and consider the
characteristics of externalities, public goods, merit goods and demerit
goods.
www.bized.co.uk
Market Failure
Learners then need to research newspapers and magazines, and use the
internet, to try and find current examples of these forms of market failure,
preferably in their own country.
Each learner can then give a presentation to the rest of the group on the
examples discovered, explaining clearly why they are a form of market
failure.
V0.1 3Y09
www.tutor2u.net/
Introduction to Market Failure
www.s-cool.co.uk/a-level/economics
What is Market Failure?
Bamford, Chp 10, pp 181–185
Gillespie, pp 23–26
Cambridge International AS and A Level Economics (US) 9275 – from 2014
41
Learning objectives
Suggested teaching activities
Learning resources
Anderton, Unit 16, pp 102–103
Question 2 in Anderton (p 106) on market failure in the car market is a
useful example.
Stanlake, Chp 21, pp 200–206
The questions on the case study of health in Stanlake (p 205) are also
helpful.
Candidates should:
understand the meaning of a
deadweight loss.
Learners need to be able to draw and explain a diagram of the deadweight
loss, such as in Bamford (p 182).
www.tutor2u.net/
Key Term – Deadweight Loss
Candidates should:
have an understanding of market
imperfections, including the
existence of monopolistic elements.
Learners need to consider the existence of monopolistic elements in
different industries; they could work in groups to look at various industries
which have monopolistic elements, especially in their own countries, and
report back to the whole class on the imperfections they have discovered.
www.s-cool.co.uk/a-level/economics
Market Structure 1
The article on the milk industry in Bamford (p 182) gives an interesting
example and the self-assessment tasks which accompany it are useful on
monopolistic elements in a market; there are also more general selfassessment tasks (p 183).
www.tutor2u.net/
Price and Output under Competition
Anderton, Unit 68, p 443
Gillespie, p 24
Anderton, Units 18–22, pp 113–143
Anderton has some useful questions on the markets in computer software
(p 112), trains (p 113) and telephones (p 114).
Candidates should:
understand the objectives of
government microeconomic policy,
especially in relation to the
concepts of efficiency and equity.
Learners need to ensure that they fully understand the difference between
efficiency and equity.
Bamford, Chp 10, pp 186–187
Anderton, Unit 61, pp 388–394
Gillespie, pp 23–24
Equity is concerned with ‘fairness’ and this involves making a value
judgement; learners should discuss this area of ‘normative’ economics by
considering when it might be appropriate for a government to intervene in a
market.
They should look at newspapers and magazines, and use the internet, to
try and find examples of such government intervention, especially in their
V0.1 3Y09
Cambridge International AS and A Level Economics (9275) – from 2014
42
Learning objectives
Suggested teaching activities
Learning resources
own country.
Candidates should:
understand the policies to correct
market failure, such as regulation.
Learners should research the policies employed in their own country to
correct market failure and assess their effectiveness.
www.s-cool.co.uk/a-level/economics
What can be done about externalities?
www.tutor2u.net/
The Redistribution of Income and Wealth
www.bized.co.uk
Income Distribution
Anderton, Unit 19, pp 120–125
Anderton, Units 20 and 21, pp 128–141
Anderton, Unit 38, pp 248–257
Anderton, Units 68 and 69, pp 442–457
Stanlake, Chps 24 and 25, pp 226–246
Gillespie, p 63
Candidates should:
understand the policies towards
income and wealth distribution.
Bamford has an interesting example in relation to the fishing industry (p
188).
Bamford, Chp10, pp 187–192
Candidates should:
be able to assess the effectiveness
of government policies.
Learners should choose one country and analyse the distribution of income
and wealth in that country; they should then explain the policies used in that
country to try and bring about a fairer distribution, concluding with an
evaluation of the effectiveness of such policies The self-assessment tasks
on this topic in Bamford (p 190) are useful.
Bamford, Chp10, pp 187–192
Candidates should:
understand the meaning of the
concept of privatisation.
Learners should choose examples of privatisation in various countries,
including their own, and find out as much as possible about them in order to
try and discover whether there has been an improvement in the quality of
service provided; they can then report back to the whole group.
www.bized.co.uk
Privatisation
This should be followed by a debate on the arguments for and against
privatisation.
www.s-cool.co.uk/a-level/economics
The Advantages of Privatisation
The Disadvantages of Privatisation
www.worldbank.org
V0.1 3Y09
Cambridge International AS and A Level Economics (9275) – from 2014
43
Learning objectives
Candidates should:
have an understanding of the
problems of transition when central
planning in an economy is reduced.
Suggested teaching activities
Learning resources
Bamford (p 196) has a useful self-assessment task in relation to water
supply, rail transport and telephone services.
Anderton has a useful summary of privatisation in the UK (pp 438–440).
The Impact of Infrastructure Privatisation
Learners should research a former centrally planned economy which is
going through a process of transition towards more of a free market, such
as Russia, Poland or the Czech Republic, and find out the various
problems which have been experienced and how they have been tackled.
Bamford, Chp 10, pp 192–200
Anderton, Unit 67, pp 433–441
Stanlake, Chp 35, pp 329–334
Stanlake, Chp 46, pp443–446
Gillespie, p 63
The self-assessment task in Bamford (p 197) has some very interesting
questions on this topic.
V0.1 3Y09
Cambridge International AS and A Level Economics (9275) – from 2014
44
Scheme of work – Cambridge International AS and A Level Economics (US) 9275
Unit 9: Theory and measurement in the macroeconomy
Recommended prior knowledge
This unit builds on the knowledge of measurement in the macroeconomy..
Context
The material focuses on theory and measurement in the macroeconomy and then leads on to the various macroeconomic problems and the different policies that can
be adopted to try and overcome these problems.
Outline
The unit begins by looking at the use of national income statistics and then goes on to consider different definitions of the money supply and the concept of the circular
flow of income. It then considers the Keynesian and monetarist schools of thought on the economy. Finally, it looks at the sources of money in an economy, the
relationship between the money supply, the price level and output and the determination of interest rates.
Teaching time
Based on a total time allocation of 360 guided learning hours for this Cambridge International AS and A Level course, it is recommended that this unit should take about
45 hours.
Learning objectives
Suggested teaching activities
Learning resources
Learners need to have a good understanding of the various terms; the first
self-assessment task in Bamford (p 203) and question 2 in Anderton (p 157)
are useful.
www.tutor2u.net/
Measuring National Income
Candidates should:
have an understanding of national
income statistics and there are four
areas to focus on:
1.
The use of national income
statistics as measures of
economic growth and living
standards
www.bized.co.uk
Economic Growth
GDP and Standard of Living
Bamford, Chp 11, pp 201–209
Anderton, Unit 25, pp 156–163
V0.1 3Y09
Cambridge International AS and A Level Economics (US) 9275 – from 2014
45
Learning objectives
Suggested teaching activities
Learning resources
Gillespie, pp 52–53
2.
Money and real data; the GDP
deflator
Learners need to be aware of the possible impact of inflation on the value of
money so that they are able to distinguish between the nominal and real
value of an amount of money; they should find out the current rate of inflation
in their own country and discuss the potential impact of this on the value of
money.
The second self-assessment task in Bamford (p203) is useful on the
distinction between nominal and real values.
3.
The comparison of economic
growth rates and living
standards over time and
between countries
Learners need to research these comparisons in their own country over a
period of time and between various countries today. The case study in
Stanlake (p 257) is a good example of a comparison over time.
The table in Bamford (p 204) and the data in Anderton (pp 162–163) are
good on the comparison between countries.
www.bized.co.uk
GDP and International Comparisons
www.imf.org
Country Information
Stanlake, Chp 26, pp 250–258
4.
Other indicators of living
standards and economic
development
Learners should consider just how difficult it is to measure living standards;
they should work in groups and discuss all the factors that would need to be
taken into account before reporting back to the class.
Bamford (p 209) has some interesting data using the Human Development
Index.
Class form groups each group produces a list of key points that they would
make to answer question 5 from past paper 9708 Paper 41 Nov 2011.
Candidates should:
understand the meaning of the term
money supply and be able to
distinguish between broad and
narrow definitions of the money
supply
V0.1 3Y09
Learners need to appreciate the idea of different forms of money and of a
liquidity spectrum; they should consider exactly what is meant by money in
different circumstances and try and rank these in terms of liquidity.
Gillespie (p 68) has a very good explanation of the different measures of the
money supply.
Cambridge International AS and A Level Economics (9275) – from 2014
www.bized.co.uk
Measuring Poverty and Living Standards
9708 past examination paper:
Nov 2011 Paper 41
For access to 9708 past papers go to Teacher
Support at http://teachers.cie.org.uk
www.tutor2u.net/
Measuring the Money Supply
Bamford, Chp 11, pp 209–211
Anderton, Unit 36, pp 234–240
Anderton, Unit 82, pp 552–557
46
Learning objectives
Suggested teaching activities
Learning resources
Teacher provides a definition of liquidity – learners arrange a given list of
financial assets in order of liquidity – class discuss choices.
Stanlake, Chp 7, pp 55
Stanlake, Chp 33, pp 304–316
Gillespie, pp 64and 68
Learners directed to end of unit quiz at www.bized.co.uk
www.bized.co.uk
Introduction to macroeconomics
Candidates should:
have an understanding of
government accounts, including the
government budget and deficit
financing
Learners should try and find information on the government accounts in their
own country and analyse these.
Candidates should:
understand the concept of the
circular flow of income between
households, firms, government and
the international economy
Learners need to have a clear understanding of this concept; the diagrams in
Bamford (p 212), Anderton (p 156), Stanlake (pp 248–250) and Gillespie (p
54) are all very helpful.
The data question in Anderton on Preparing a Budget (pp 239–240) and the
self-assessment task on a budget deficit in Bamford (p 211) are very useful.
Learners should discuss the concept, recognising the importance of the link
between income and expenditure.
Extension
Opportunity to allow advanced learners to build circular income flow
diagrams on whiteboard and then use for further class discussion.
Candidates should:
understand the differences between
the Keynesian and monetarist
schools of thought on how the
macroeconomy functions
V0.1 3Y09
www.bized.co.uk
The Circular Flow of Income
www.tutor2u.net/
The Circular Flow of Income and Spending
www.s-cool.co.uk/a-level/economics
The Circular Flow of Income
Bamford, Chp 11, pp 212
Anderton, Unit 25, pp 156–157
Stanlake, Chp 26, pp 248–250
Gillespie, p 54
Learners should research the key features of the two approaches and the
background to the development of these theories and then give a
presentation on their findings, evaluating the strengths and weaknesses of
each; it might also be a suitable topic for a debate, comparing and
contrasting the two schools of thought.
www.bized.co.uk
Introduction to Keynesians
Introduction to Monetarists
There are useful summaries of the two approaches in Bamford (p 212) and
Gillespie (p 87).
Bamford, Chp 11, p 212
Stanlake, Chp 25, pp 240–242
Cambridge International AS and A Level Economics (9275) – from 2014
www.s-cool.co.uk/a-level/economics
Do Keynesians and Monetarists Agree?
47
Learning objectives
Suggested teaching activities
Learning resources
Extension
Advanced learners deliver group presentation.
Gillespie, p 87
Candidates should:
understand the meaning of the
aggregate expenditure function
(AE), its components and their
determinants
Learners need to have a good understanding of the necessary diagrams;
Bamford (pp 215–218) and Gillespie (pp 84–86) are very helpful.
www.s-cool.co.uk/a-level/economics
The 45 Degree Diagram
The self-assessment tasks on the Singapore economy in Bamford (p 214)
and the data response questions in Stanlake (p 282) are both useful.
www.bized.co.uk
Consumption, Investment and Growth
understand the concept of income
determination using the AE-income
and the withdrawal/injection
approaches
Direct learners to www.economicsonline.co.uk
(macroeconomics aggregate demand video)
www.tutor2u.net/
Household Savings
Behaviour
Inflationary Gaps
Investment
Class discussion based on the video.
Bamford, Chp 11, pp 212–219
Anderton, Units 35 and 36, pp 227–235
Stanlake, Chp 27, pp 259–264
Stanlake, Chp 29, pp 279–283
Stanlake, Chp 52, pp 503–511
Gillespie, pp 60–62 and 84–86
Candidates should:
have an understanding of
inflationary and deflationary gaps
and be able to distinguish between
the full employment level of income
and the equilibrium level of income
Extension
Opportunity for advanced learners to draw relevant diagrams on whiteboard
– rest of class decide whether diagrams are correct and if not, why not.
Candidates should:
understand the concepts of the
multiplier and the accelerator
Learners need to have a good grasp of how the multiplier works; the selfassessment task in Bamford (p 218), question 3 in Anderton (p 215) and the
examples in Stanlake (pp 503–505) are all very useful. The accelerator also
needs to be understood; question 4 in Anderton (p 208) and question 3 in
Anderton (p 522) are helpful.
be able to distinguish between
autonomous and induced
investment
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www.bized.co.uk
The Multiplier Principle
www.tutor2u.net/
The National Income Multiplier
Anderton, Unit 33, pp 214–215
Cambridge International AS and A Level Economics (9275) – from 2014
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Learning objectives
Suggested teaching activities
Learning resources
Candidates should:
understand the sources of money
supply in an open economy
(commercial banks/credit creation,
central bank, deficit financing, total
currency flow)
Learners should try and find information on the sources of money in their
own country.
www.tutor2u.net/
The Quantity Theory of Money
Learners should also attempt to obtain data on the money supply and the
rate of inflation in their own country over a period of time and see what
conclusions can be drawn about their relationship.
Bamford, Chp 11, pp 222–223
Anderton, Units 84 and 85, pp 564–573
Stanlake, Chp 34, pp 323–324
Stanlake, Chp 66, pp 628–629
Gillespie, pp 67 and 74–75
Candidates should:
have an understanding of the
relationship between the money
supply, the price level and output
as explained by the Quantity
Theory of Money
The self-assessment task in Bamford (p 224) is very good on the link
between changes in the money supply and changes in the rate of inflation.
Question 1 (p 565) and 3 (p 566) in Anderton are very good in helping to
explain the Quantity Theory of Money.
There is also a useful discussion of the link between inflation and the money
supply in the Applied Economics section in Anderton (pp 567–568) and a
helpful data question on housing and the money supply (pp 568–569).
Candidates should:
understand the demand for money
and the determination of interest
rates, including both the Liquidity
Preference and the Loanable
Funds theories
Learners should research the different rates of interest in their own country
and try to explain why there can be such a diversity of rates rather than just
one single rate.
www.tutor2u.net/
The demand for money
Interest rates and economic activity
Teacher establishes distinction between ‘active’ and ‘idle’ cash balances and
learners research Keynesian demand for money theory and then answer
questions on class worksheet – answers discussed in class.
Bamford, Chp 11, pp 224–226
Anderton, Units 82 and 83, pp 555–563
Stanlake, Chp 16, pp 149–160
Gillespie, pp 61 and 69–72
Learners need to have a clear understanding of the diagrams; Bamford (pp
224–226) and Gillespie (pp 69–72) are particularly helpful.
The self-assessment task on Japanese interest rates in Bamford (p 226) and
questions 1 (p 559) and 2 (p 560) in Anderton are useful; the latter question,
however, uses interest rates which refer to the UK financial market and so it
might be better to construct and use a similar table of local figures.
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Scheme of work – Cambridge International AS and A Level Economics (US) 9275
Unit 10: Macroeconomic problems and policies
Recommended prior knowledge
This unit builds on previous work on macroeconomics.
Context
The material follows on from the previous unit on theory and measurement in the macroeconomy and brings the course to a conclusion by focusing on the main
macroeconomic problems and the effectiveness of the various policies that could be adopted to try and overcome such problems.
Outline
The unit begins with an analysis of economic growth and development, including the factors contributing to economic growth, the costs and benefits of growth and the
characteristics of developing economies. It then examines the different types of unemployment and the causes and consequences of unemployment and goes on to
consider the relationships between the internal and external value of money, the balance of payments and inflation and between unemployment and inflation. It then
considers the various policies that could be adopted to try and overcome these problems, including fiscal policy, monetary policy, exchange rate policy and supply side
policy. The unit ends with a consideration of the possible conflicts between the various policy objectives and an evaluation of the policy options to deal with these
problems.
Teaching time
Based on a total time allocation of 360 guided learning hours for this Cambridge AS and A Level course, it is recommended that this unit should take about 45 hours.
Learning objectives
Suggested teaching activities
Learning resources
Candidates should:
understand the meaning of the
concepts of economic growth and
development.
Worksheet on economic growth in developed and developing countries
looking at types of economies and causes of economic growth and
highlighting useful data sources. Learners match the type of economy
with selected countries
(www.bized.co.uk/learn/economics/development/growth/worksheet.htm)
www.bized.co.uk
Economic Growth
Virtual Developing Country
Causes of Economic Growth
Homework or class task to support the teaching and learning of the costs
and benefits of ecomomic growth in developing countries. – small groups
of learners prepare a presentation which outlines the costs and benefits of
economic growth. The following points may help in the planning:
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www.tutor2u.net/
Economic Growth
Development Economics
Categorising Countries
Economics of Development
Measuring Standard of Living
Limitations of GDP as a Measure of Living
Cambridge International AS and A Level Economics (US) 9275 – from 2014
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Learning objectives
Suggested teaching activities









Do developing countries have the bureaucratic infrastructure to
ensure taxes are collected and used appropriately?
What institutional and cultural changes are necessary to help
developing countries take advantage of economic growth?
What are the opportunity costs of economic growth to developing
countries?
Are factors such as pollution, environmental degradation and a
reduction in biodiversity likely to affect developing countries more
than developed countries - if so, why?
Will the costs and benefits of economic growth differ depending
on where the developing country is situated, for example, subSaharan Africa, Asia, and South America?
Is a lack of regulation and legislation likely to lead to developing
countries being exploited by firms from the developed world such
that the benefits of any investment are not felt by the population
as a whole?
How far will corruption and the nature of the political system
determine the benefits and costs of economic growth?
How important is the establishment of property rights a factor in
the benefits gained from economic growth?
Are the opportunity costs of economic growth, as we understand
it, too high for developing countries?
(www.bized.co.uk/educators/1619/economics/development/activity/costben.htm)
Candidates should:
be able to give a definition of
economic growth and development.
Learners need to be able to clearly distinguish between the concepts of
growth and development; a useful starting point would be for them to work
in groups and consider exactly what is involved in the idea of
development, so that they can see how it differs from growth, and then
report back to the whole class.
Learning resources
Standards
United Nations Human Poverty Index
Less Developed Countries
www.jusbiz.org
Economic Growth, Development and Poverty
Does Economic Growth Benefit the Poor?
Virtual Developing Country
Borderless Business – Transnationals and the
Global Economy
The Missing Link – Debt and Trade
International Debt Role Play
www.worldbank.org
Topics in Development
Data on Member Countries
www.imf.org
Country Information
World Economic Outlook
www.tutor2u.net/
Benefits of Economic Growth
Costs of Economic Growth
Sustainable Economic Growth
www.bized.co.uk
Costs of Economic Growth –
Who Pays?
Bamford, Chp 12, pp 229–231
Anderton, Unit 24, p 151
Anderton, Unit 26, pp 164–172
Anderton, Unit 99, p 679
Stanlake, Chp 30, pp 285–286
Gillespie, pp 105–106 and 97–101
Anderton (p 679) and Gillespie (p 97) have useful distinctions between
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Learning objectives
Suggested teaching activities
Learning resources
the first, second and third world countries.
Candidates should:
have an understanding of the
indicators of comparative
development and underdevelopment
in the world economy, including
economic, monetary, non-monetary
and demographic factors
Each learner should research one particular developed country and one
underdeveloped country and give a presentation to the whole class on
what they found out, pointing out the differences in the level of
development.
Candidates should:
understand the characteristics of
developing economies: population
growth and structure, income
distribution, economic structure,
employment composition, external
trade and urbanisation in developing
economies and the nature of
dependency, including the role of
multi-national corporations and
external debt
The self-assessment tasks in Bamford (p 236) on the characteristics of
developing countries are very useful.
Bamford, Chp 12, pp 231–236
Anderton, Unit 99, pp 679–685
Stanlake, Chp 65, pp 615–616
Gillespie, pp 97–101
There is a lot of scope in this unit for using a range of international
examples for presentations, discussions, analysis and evaluation.
The information obtained from the research will be useful in enabling
learners to build up a picture of what is meant by a developing country.
Bamford, Chp 12, pp 231–236
Anderton, Units 99 and 100, pp 679–691
Stanlake, Chp 65, pp 615–625
Gillespie, p 97–101
Anderton has a useful summary of some of the main factors which affect
the level of development of a country (pp 680–685) and the data
questions on Mozambique, Chile, Egypt, Tanzania and Romania which
follow the tables (p 685) are helpful.
There is also a useful data question on Egypt in Anderton (pp 690–691)
and a case study on health in Stanlake (p 624).
The Jusbiz website www.jusbiz.org has an interesting role play on
international debt.
Candidates should:
have an understanding of the
distinction between actual and
potential growth in national output.
The distinction between actual and potential growth is best explained by a
production possibility diagram, such as in Bamford (p 236) or Stanlake (p
513).
Bamford, Chp 12, p 236
Anderton, Unit 26, pp 164–165
Stanlake, Chp 53, pp 512–513
Gillespie, p 105
Candidates should:
understand the factors contributing to
economic growth.
Learners should work in groups and consider what they think would be
the major factors explaining why the growth rate of some countries is
much higher than that of other countries and then report back to the
whole class.
Anderton has a useful summary of the factors affecting the UK's growth
Bamford, Chp 12, pp 236–238
Anderton, Unit 26, pp 165–172
Stanlake, Chp 53, pp 513–514
Gillespie, pp 105–106
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Learning objectives
Suggested teaching activities
Learning resources
rate (pp 167–171).
Candidates should:
understand the costs and benefits of
growth, including using and
conserving resources.
Learners should research the relative costs and benefits of economic
growth (the Tutor2u website will be very helpful as a starting point) and
then have a debate on the topic.
Bamford, Chp 12, pp 238–240
Anderton, Unit 27, pp 172–179
Stanlake, Chp 53, pp 514–515
Gillespie, p 105
Candidates should:
have an understanding of
unemployment
Learners in groups list the main types and causes of unemployment.
www.tutor2u.net/
Measuring Unemployment
The Natural Rate of Unemployment
The Causes of Unemployment
The Economic and Social Costs of Unemployment
Class discuss:
 What are the implication for government spending and taxation?
 What are the economic costs of unemployment?
 What are the social costs of unemployment?
 What are the costs of unemployment to the individual?
Candidates should:
understand the meaning of full
employment and the natural rate of
unemployment
Learners should work in groups and consider the various reasons why a
person might be out of work and then report back to the whole class.
Candidates should:
have an understanding of the causes
of unemployment.
Learners should also consider some of the possible reasons why certain
countries have much higher rates of unemployment than other countries.
www.s-cool.co.uk/a-level/economics
Unemployment
Can the Natural Rate of Unemployment change?
The Main Types of Unemployment
Anderton, Unit 29, pp 186–190
Anderton, Unit 86, pp 581–588
Gillespie, pp 76–79
Learners also need to consider why it might actually be quite difficult to
establish precisely just how many people may be out of work in a
particular country; Anderton is very good on the different measures of
unemployment (pp 188–189).
Bamford, Chp 12, pp 241–242
Stanlake, Chp 56, pp 531–542
The self-assessment tasks in Bamford (p 242) and the data response
questions in Stanlake (p 541) are useful.
Learners analyse the main causes of unemployment in their own country.
understand the consequences of
unemployment.
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Learners should work in groups and discuss the consequences of
unemployment, both for the people concerned and for the economy as a
whole, and then report back to the class.
Cambridge International AS and A Level Economics (9275) – from 2014
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Learning objectives
Suggested teaching activities
Learning resources
Candidates should:
understand the inter-connectedness
of problems. They should be aware
of the links between macroeconomic
problems and their interrelatedness,
for example:
Learners should work in groups and consider why and how the different
macroeconomic problems are related; a spider diagram, showing the link
between the different macroeconomic problems, could be a good learning
exercise and would help learners answer questions requiring a broad
view.
www.tutor2u.net/
The Phillips curve
The Phillips Curve and the NAIRU
www.s-cool.co.uk/a-level/economics
The Phillips Curve
Gillespie, p 80

the relationship between the
external and internal value of
money
Ideally, learners should divide into three groups, with each one focusing
on a particular relationship, and then give a presentation to the whole
class.

the relationship between the
balance of payments and
inflation
The self-assessment tasks on the relationship between unemployment
and inflation in Bamford (p 244) are useful.
Bamford, Chp 12, pp 243–244
Anderton, Unit 87, pp 589–595
Anderton has a lot of helpful information on the Phillips Curve (pp 593–
595) and some useful data on unemployment and inflation in selected
countries.

the relationship and trade-off
between inflation and
unemployment
Candidates should:
understand the objectives of
macroeconomic policy, such as
stabilisation and growth
Stanlake has an interesting case study on the links between inflation and
unemployment.
Stanlake, Chp 59, pp 564–571
Learners need to be aware of the different macroeconomic objectives;
they should work in groups, consider why governments might wish to
intervene in the macroeconomy and then give a presentation to the whole
class – presentations then assessed by rest of class and teacher.
www.tutor2u.net/
The Objectives of Macroeconomic Policy
There are useful summaries of the different objectives in Bamford (p 246)
and Stanlake (pp 284–286).
www.s-cool.co.uk/a-level/economics
The Main Macroeconomic Objectives
The Importance of Macroeconomic Objectives
Bamford, Chp 13, p 246
Anderton, Unit 24, pp 151–155
Stanlake, Chp 30, pp 284–289
Candidates should:
have an understanding of the various
V0.1 3Y09
Learners should choose a particular developing country and try and find
out as much as possible about the policies of trade and aid that apply to it
Cambridge International AS and A Level Economics (9275) – from 2014
www.tutor2u.net/
Potential Gains from Trade
54
Learning objectives
Suggested teaching activities
Learning resources
policies towards developing countries
that could be adopted, including
policies of trade and aid
and then give a presentation to the whole class; the World Bank and IMF
websites will be particularly useful. Anderton has a very detailed account
of aid (pp 716–726) and useful data response questions on aid to
developing countries.
www.imf.org
Country Information
www.worldbank.org
Data on Member Countries
Bamford, Chp 13, pp 246–251
Anderton, Units 103 and 104, pp 710–727
Stanlake, Chp 65, pp 615–625
Gillespie, pp 99–101
Candidates should:
understand the different types of
policy, including the aims and
instruments of each policy and how
each is used to control inflation,
stimulate employment, growth and
development and correct balance of
payments disequilibrium
Learners need to understand the key features of each of the four types of
policy; they need to work in groups and research how one particular
country has used these policies to achieve its objectives and assess how
effective they were.
Alternatively, they could divide into four groups with each one examining
the ways in which these policies have been operating in their own country
to try and achieve particular macroeconomic objectives.
The group research would be followed by a presentation to the rest of the
class.
Learners write an in-class structured essay discussing the effectiveness
of any one stabilisation policy carried out by their own government.
www.s-cool.co.uk/a-level/economics
Inflation
Fiscal Policy
Monetary Policy
The Exchange Rate and the Balance of Payments
www.tutor2u.net/
Policies to Control Inflation
Policies to Reduce Unemployment
Government Policy towards the Balance of
Payments
Fiscal Policy
Monetary Policy
Economic Effects of a Depreciating Currency
Supply Side Economics
www.bized.co.uk
Economic Growth Policies
Unemployment Policy
Inflation Policy
Using Fiscal Policy
Using Monetary Policy
Candidates should:
be able to assess the effectiveness
V0.1 3Y09
The self-assessment tasks in Bamford (pp 252–255) are very useful.
Cambridge International AS and A Level Economics (9275) – from 2014
Anderton, Unit 85, pp 571–580
Anderton, Unit 88, pp 596–603
55
Learning objectives
Suggested teaching activities
Learning resources
of each of the policies:
Anderton has some helpful material in the Applied Economics sections,
such as on unemployment policy (pp 599–601) and the control of inflation
(pp 614–617).
Anderton, Units 91–92, pp 619–629
Anderton, Unit 96, pp 653–660
Stanlake, Chps 32–35, pp 296–334
Stanlake, Chp 51, pp 488–500
Stanlake, Chp 55, pp 526–530
Stanlake, Chp 57, pp 543–552
Stanlake, Chps 60–61, pp 572–588
Gillespie, pp 64–72, 82 and 88–9
i.
ii.
iii.
iv.
Fiscal Policy
Monetary Policy
Exchange Rate Policy
Supply side policy
Candidates should:
understand the conflicts between
policy objectives and be able to
evaluate policy options to deal with
problems
Stanlake has useful data response questions and case studies on
economic growth (pp 529–530), unemployment (pp 550–552), inflation
(pp 579–581) and the balance of payments (pp 586–587).
Formative assessment based on data response question from 9708
Paper 43 past paper June 2012.
For access to 9708 past papers go to Teacher
Support at http://teachers.cie.org.uk
Learners need to consider the possible difficulties of trying to achieve
particular policy objectives in terms of the potential trade-offs in other
areas; they should work in groups and think of examples of such tradeoffs, followed by a presentation to the whole class.
www.s-cool.co.uk/a-level/economics
Conflicts between Macroeconomic Objectives
Bamford, Chp 13, pp 257–258
Anderton, Unit 92, pp 626–629
Stanlake, Chp 62, pp 589–593
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