Edexcel IGCSE 2009 - Wikispacesdcszeconomics.wikispaces.com/file/view/IGCSE+Economics... · Introduction The Edexcel International General Certificate of Secondary Education (IGCSE)

Specification

Edexcel IGCSE in Economics (4EC0)First examination 2011

IGCSE�Economics

Edexcel, a Pearson company, is the UK’s largest awarding body, offering academic and vocational qualifications and testing to more than 25,000 schools, colleges, employers and other places of learning in the UK and in over 100 countries worldwide. Qualifications include GCSE, AS and A Level, NVQ and our BTEC suite of vocational qualifications from entry level to BTEC Higher National Diplomas, recognised by employers and higher education institutions worldwide.

We deliver 9.4 million exam scripts each year, with more than 90% of exam papers marked onscreen annually. As part of Pearson, Edexcel continues to invest in cutting-edge technology that has revolutionised the examinations and assessment system. This includes the ability to provide detailed performance data to teachers and students which help to raise attainment.

Acknowledgements

This specification has been produced by Edexcel on the basis of consultation with teachers, examiners, consultants and other interested parties. Edexcel would like to thank all those who contributed their time and expertise to its development.

References to third-party material made in this specification are made in good faith. Edexcel does not endorse, approve or accept responsibility for the content of materials, which may be subject to change, or any opinions expressed therein. (Material may include textbooks, journals, magazines and other publications and websites.)

Authorised by Roger Beard Prepared by Lucy Stewart

All the material in this publication is copyright © Edexcel Limited 2008

Introduction

The Edexcel International General Certificate of Secondary Education (IGCSE) in Economics is designed for use in schools and colleges. It is part of a suite of IGCSE qualifications offered by Edexcel.

The Edexcel IGCSE in Economics is designed as a two-year course. As students progress through the course they are introduced to new ideas and concepts while continuing to use and reinforce previously learned concepts and skills. The course is designed to give students a sound understanding of economics, and the ability to use knowledge, skills and understanding appropriately in the context of individual countries and the global economy.

Key subject aims

The Edexcel IGCSE in Economics qualification enables students to:

• develop an understanding of economic concepts and apply these concepts to real-life situations

• interpret and evaluate economic data in order to make reasoned arguments and informed judgements

• develop an awareness of economic change and its impact on developing and developed economies

• understand economic issues, problems and possible solutions that affect mixed economies

• participate effectively in society as citizens, producers and consumers.

About this specification

Key features and benefits of the specification

Key features and benefits are:

• 100% examination — single assessment route allowing all students to demonstrate their knowledge and understanding of economics

• assessment opportunity in both January and June examination series

• comprehensive and detailed description of subject content

• subject content kept to manageable proportions

• provides opportunities to apply the subject content to local economic circumstances

• appropriate for students of various ages and from diverse backgrounds in terms of general education and lifelong learning

• provides a sound foundation for Edexcel AS GCE and Advanced GCE in Economics, or equivalent qualifications.

Contents

Specification at a glance 1

Qualification content 3 Paper 1: Economics 3

Content overview 3 Subject content 4 A The Market System 4 B Business Economics 7 C Government and the Economy 10 D The Global Economy 13

Assessment 15 Assessment summary 15

Assessment Objectives and weightings 15

Entering your students for assessment 16 Student entry 16 Combinations of entry 16 Access arrangements and special requirements 16

Assessing your students 16 Awarding and reporting 17 Language of assessment 17 Malpractice and plagiarism 17

Student recruitment 17

Progression 17

Grade descriptions 18

Support and training 19 Edexcel support services 19

Training 19

Textbooks and resources 20

Specification – Edexcel IGCSE in Economics (4EC0) – Issue 1 – September 2008 © Edexcel Limited 2008 1

Specification at a glance The Edexcel IGCSE in Economics is assessed through a written examination paper.

Paper 1: Economics Paper code: 4EC0/01

• Externally assessed

• Availability: January and June series

• First assessment: June 2011

Overview of content

There are four areas of subject content. Students are required to study all four areas.

A The Market System

– Demand and supply

– The role of the market in solving the economic problem

– The labour market

B Business Economics

– Production

– Competition

– Public and private sectors

C Government and the Economy

– Macroeconomic objectives

– Policies

– Relationship between objectives and policies

D The Global Economy

– Globalisation

– International trade

– Exchange rates

Overview of assessment

• This qualification is assessed through an examination paper lasting two hours and 30 minutes, set and marked by Edexcel.

• Single tier of entry.

• The total number of marks available is 120.



Qualification content

Paper 1: Economics

Content overview There are four areas of subject content. Students are required to study all four areas.

A The Market System

• Demand and supply

• The role of the market in solving the economic problem

• The labour market

B Business Economics

• Production

• Competition

• Public and private sectors

C Government and the Economy

• Macroeconomic objectives

• Policies

• Relationship between objectives and policies

D The Global Economy

• Globalisation

• International trade

• Exchange rates

Assessment overview

• The assessment of this qualification is through an examination paper lasting two hours and 30 minutes, set and marked by Edexcel.



• The examination paper consists of four compulsory questions, each worth 30 marks.

• The questions are a mixture of structured, data response, short-answer, multiple-choice and open-ended questions.

• Each question will be based on a particular theme which will relate to one of the four sections of the subject content. However, due to the nature of economics, there may be some overlap between the questions.

Spec

ifica

tion

– Ed

exce

l IG

CSE

in E

cono

mic

s (4E

C0)

– Is

sue

1 –

Sept

embe

r 200

8 ©

Ede

xcel

Lim

ited

2008

4 Su

bjec

t co

nten

t

A

The

Mar

ket

Syst

em

Con

cept

/idea

C

onte

nt

Illu

stra

tive

guid

ance

for

teac

hers

1 D

eman

d an

d su

pply

Rol

e in

the

dete

rmin

atio

n of

pr

ice

in th

e m

arke

t.

Dem

and

and

supp

ly c

urve

s

• Th

e re

latio

nshi

p be

twee

n pr

ice

and

quan

tity

dem

ande

d an

d qu

antit

y su

pplie

d.

• Th

e co

ncep

t of t

he m

arke

t equ

ilibr

ium

: shi

fts a

nd m

ovem

ents

of

dem

and

and

supp

ly c

urve

s.

• Fa

ctor

s aff

ectin

g de

man

d:

– ad

verti

sing

, inc

ome,

pop

ulat

ion,

fash

ion,

pric

e, o

ther

pr

oduc

ts, i

e co

mpl

emen

ts a

nd su

bstit

utes

.

• Fa

ctor

s aff

ectin

g su

pply

:

– co

sts o

f pro

duct

ion,

indi

rect

taxe

s and

subs

idie

s, ch

ange

s in

tech

nolo

gy, n

atur

al fa

ctor

s, eg

wea

ther

.

Dia

gram

s are

an

esse

ntia

l too

l for

bot

h th

e un

ders

tand

ing

and

anal

ysis

of d

eman

d an

d su

pply

. The

y sh

ould

be

used

:

• as

an

aid

to sh

ow th

e re

latio

nshi

p be

twee

n a

chan

ge in

pri

ce

and

a m

ovem

ent a

long

the

dem

and

and

supp

ly c

urve

s

• to

dis

tingu

ish

betw

een

the

effe

cts o

f a c

hang

e in

pri

ce

(mov

emen

t alo

ng th

e cu

rves

) and

a sh

ift in

the

curv

es fo

r bot

h de

man

d an

d su

pply

• to

ana

lyse

the

effe

cts o

f cha

nges

in d

eman

d an

d su

pply

on

the

mar

ket e

quili

briu

m p

rice

, qua

ntity

dem

ande

d an

d qu

antit

y su

pplie

d.

Stud

ents

shou

ld n

ote

that

the

topi

c Po

pula

tion

shou

ld in

clud

e th

e m

ain

dete

rmin

ants

of t

he si

ze a

nd a

ge d

istr

ibut

ion

of th

e po

pula

tion

and

the

depe

nden

cy ra

tio. T

he c

onse

quen

ces o

f ch

ange

s in

the

popu

latio

n on

dem

and,

firm

s, go

vern

men

t, ec

onom

y an

d th

e en

viro

nmen

t for

m th

e ba

sis o

f fur

ther

ana

lysi

s in

Sect

ions

B, C

and

D o

f the

subj

ect c

onte

nt.

Pr

ice

and

inco

me

elas

ticity

• D

efin

ition

s and

form

ulae

.

• Fa

ctor

s aff

ectin

g pr

ice

elas

ticity

of d

eman

d: su

bstit

utes

, de

gree

of n

eces

sity

, per

cent

age

of in

com

e sp

ent o

n go

ods o

r se

rvic

e.

• Fa

ctor

s aff

ectin

g pr

ice

elas

ticity

of s

uppl

y: ti

me,

ela

stic

ity o

f fa

ctor

s of p

rodu

ctio

n.

• Fa

ctor

s aff

ectin

g in

com

e el

astic

ity: n

orm

al a

nd in

ferio

r goo

ds.

• A

pplic

atio

n of

ela

stic

ity, i

ts e

ffec

ts o

n th

e de

cisi

on m

akin

g of

fir

ms a

nd g

over

nmen

t.

Cal

cula

tions

usi

ng th

e fo

rmul

ae a

re n

ot re

quir

ed. D

iagr

ams w

ith

slop

es sh

owin

g el

astic

and

inel

astic

dem

and

and

supp

ly c

urve

s ar

e re

quir

ed.

Use

of t

otal

reve

nue

calc

ulat

ions

to sh

ow th

e re

latio

nshi

p be

twee

n a

chan

ge in

pri

ce a

nd th

e ch

ange

in to

tal r

even

ue fo

r diff

erin

g el

astic

ities

is im

port

ant.

Use

of d

ata

to sh

ow th

e re

latio

nshi

p be

twee

n ch

ange

s in

inco

me

and

quan

tity

dem

ande

d re

quir

ed. D

iagr

ams n

ot re

quir

ed.

Appl

icat

ion

and

anal

ysis

of e

xam

ples

requ

ired

. Inc

lude

the

diffe

renc

es in

ela

stic

ity o

f sup

ply

betw

een

man

ufac

ture

d go

ods

and

prim

ary

prod

ucts

.

Spec

ifica

tion

– Ed

exce

l IG

CSE

in E

cono

mic

s (4E

C0)

– Is

sue

1 –

Sept

embe

r 200

8 ©

Ede

xcel

Lim

ited

2008

5

Con

cept

/idea

C

onte

nt

Illu

stra

tive

guid

ance

for

teac

hers

2 T

he r

ole

of th

e m

arke

t in

solv

ing

the

econ

omic

pr

oble

m

Res

olvi

ng sc

arci

ty

• Fi

nite

reso

urce

s and

cho

ice.

• O

ppor

tuni

ty c

ost a

nd it

s eff

ects

on

the

indi

vidu

al, f

irms a

nd

gove

rnm

ents

.

• Pr

oduc

tion

poss

ibili

ty c

urve

s to

illus

trate

opp

ortu

nity

cos

t

Exam

ples

of o

ppor

tuni

ty c

ost n

eede

d.

T

he m

ixed

eco

nom

y

• D

efin

ition

s of m

ixed

eco

nom

y, p

ublic

sect

or a

nd p

rivat

e se

ctor

.

• C

once

pt o

f mar

ket f

ailu

re a

nd ro

le o

f pub

lic se

ctor

.

• Th

e ro

le o

f the

pub

lic se

ctor

and

priv

ate

sect

ors i

n th

e pr

oduc

tion

of g

oods

and

serv

ices

.

How

the

prob

lem

s of w

hat t

o pr

oduc

e, h

ow to

pro

duce

and

for

who

m to

pro

duce

are

solv

ed th

roug

h th

e m

ixed

eco

nom

y. T

ypes

of

busi

ness

org

anis

atio

n in

the

priv

ate

sect

or n

ot re

quir

ed.

Con

cept

of e

ffici

ency

requ

ired

but

not

type

s of e

ffici

ency

, ie

allo

cativ

e an

d pr

oduc

tive.

Dis

cuss

ion

of m

oder

n ex

ampl

es, d

raw

n fr

om a

n ec

onom

y of

you

r ch

oice

.

3 T

he la

bour

m

arke

t: a

n ex

ampl

e of

a

mar

ket i

n a

mix

ed

econ

omy

Wag

es a

nd e

mpl

oym

ent i

n a

free

eco

nom

y

• D

ivis

ion

of la

bour

.

• A

dvan

tage

s and

dis

adva

ntag

es o

f div

isio

n of

labo

ur: f

or th

e w

orke

r and

for t

he fi

rm.

• Fa

ctor

s aff

ectin

g de

man

d fo

r lab

our:

– de

man

d fo

r fin

al p

rodu

ct

– av

aila

bilit

y of

subs

titut

es, e

g m

achi

nes

– pr

oduc

tivity

of t

he w

orkf

orce

.

• Fa

ctor

s aff

ectin

g su

pply

of l

abou

r:

– de

term

inan

ts o

f wor

king

pop

ulat

ion,

ie a

ge d

istri

butio

n,

retir

emen

t and

scho

ol-le

avin

g ag

e, fe

mal

e pa

rtici

patio

n in

th

e la

bour

forc

e.

• Q

ualif

icat

ions

and

trai

ning

.

Dia

gram

s ind

icat

ing

how

cha

nges

in d

eman

d an

d su

pply

of

labo

ur (i

n bo

th th

e ec

onom

y an

d pa

rtic

ular

occ

upat

ions

) sho

uld

be u

sed

to a

naly

se th

e ef

fect

s on

wag

es a

nd e

mpl

oym

ent.

Both

the

quan

tity

and

qual

ity o

f the

labo

ur sh

ould

be

cons

ider

ed.

Mar

gina

l rev

enue

pro

duct

ivity

theo

ry n

ot re

quir

ed.

Spec

ifica

tion

– Ed

exce

l IG

CSE

in E

cono

mic

s (4E

C0)

– Is

sue

1 –

Sept

embe

r 200

8 ©

Ede

xcel

Lim

ited

2008

6 C

once

pt/id

ea

Con

tent

Il

lust

rativ

e gu

idan

ce fo

r te

ache

rs

3 T

he la

bour

m

arke

t: a

n ex

ampl

e of

a

mar

ket i

n a

mix

ed

econ

omy

(con

tinue

d)

Inte

rfer

ence

in th

e la

bour

mar

ket

• M

inim

um w

age

legi

slat

ion:

– re

ason

s for

the

legi

slat

ion

– di

agra

m to

show

the

effe

cts o

n w

ages

and

em

ploy

men

t.

• Tr

ade

unio

ns:

– ef

fect

s of t

heir

stre

ngth

on

wag

es a

nd e

mpl

oym

ent.

Refe

renc

e sh

ould

be

mad

e to

min

imum

wag

e le

gisl

atio

n in

an

econ

omy

of y

our c

hoic

e.

Des

crip

tions

of t

ypes

or d

etai

led

acco

unts

of f

unct

ions

of u

nion

s ar

e no

t req

uire

d. E

mph

asis

shou

ld b

e on

exp

lana

tion

of th

e ef

fect

s.

Spec

ifica

tion

– Ed

exce

l IG

CSE

in E

cono

mic

s (4E

C0)

– Is

sue

1 –

Sept

embe

r 200

8 ©

Ede

xcel

Lim

ited

2008

7

B Bu

sine

ss E

cono

mic

s

Con

cept

/idea

C

onte

nt

Illu

stra

tive

guid

ance

for

teac

hers

1 Pr

oduc

tion

Prod

uctio

n an

d pr

oduc

tivity

• Fa

ctor

s of p

rodu

ctio

n: la

nd, l

abou

r, ca

pita

l, en

terp

rise.

• Se

ctor

s of t

he e

cono

my:

prim

ary,

seco

ndar

y, te

rtiar

y.

• C

hang

ing

impo

rtanc

e of

thes

e se

ctor

s in

term

s of e

mpl

oym

ent

and

outp

ut o

ver t

ime,

in d

evel

opin

g an

d de

velo

ped

econ

omie

s.

Emph

asis

on

the

diffe

renc

e be

twee

n pr

oduc

tion

and

prod

uctiv

ity.

Rela

te in

crea

ses i

n fa

ctor

s to

incr

ease

d pr

oduc

tion.

Mod

ern

exam

ples

, dra

wn

from

an

econ

omy

of y

our c

hoic

e.

Dat

a fo

r con

tras

ting

deve

lope

d an

d de

velo

ping

cou

ntri

es sh

ould

be

stud

ied

by c

onsi

deri

ng th

e m

ovem

ent a

way

from

pri

mar

y an

d to

war

ds se

cond

ary

and

tert

iary

indu

stry

.

Pr

oduc

tion

cost

s and

rev

enue

• Fi

xed

and

varia

ble

cost

s, to

tal c

ost,

aver

age

cost

, pric

e, to

tal

reve

nue

and

prof

it.

• Ec

onom

ies a

nd d

isec

onom

ies o

f sca

le.

• In

tern

al e

cono

mie

s: m

arke

ting,

tech

nica

l, fin

anci

al,

man

ager

ial,

risk-

bear

ing.

• Ex

tern

al e

cono

mie

s: sk

illed

labo

ur, i

nfra

stru

ctur

e, a

ncill

ary

firm

s.

• D

isec

onom

ies:

bur

eauc

racy

, lab

our r

elat

ions

.

Cal

cula

tions

with

sim

ple

num

eric

al e

xam

ples

requ

ired

.

Mar

gina

l cos

t and

mar

gina

l rev

enue

not

requ

ired

.

Dia

gram

of a

vera

ge c

ost c

urve

show

ing

effe

ct o

f eco

nom

ies a

nd

dise

cono

mie

s of s

cale

is th

e on

ly c

ost c

urve

requ

ired

.

Pr

oduc

tivity

and

wea

lth c

reat

ion

• Fa

ctor

s aff

ectin

g pr

oduc

tivity

:

– la

nd: u

se o

f fer

tilis

ers,

drai

nage

, irr

igat

ion

– la

bour

: im

prov

ed h

uman

cap

ital

– ca

pita

l: us

e of

mor

e m

achi

nery

and

tech

nolo

gica

l ad

vanc

es.

This

shou

ld fo

rm a

bas

is fo

r fur

ther

ana

lysi

s of e

cono

mic

gro

wth

in

Sec

tion

C o

f the

subj

ect c

onte

nt, G

over

nmen

t and

the

Eco

nom

y.

Spec

ifica

tion

– Ed

exce

l IG

CSE

in E

cono

mic

s (4E

C0)

– Is

sue

1 –

Sept

embe

r 200

8 ©

Ede

xcel

Lim

ited

2008

8 C

once

pt/id

ea

Con

tent

Il

lust

rativ

e gu

idan

ce fo

r te

ache

rs

1 Pr

oduc

tion

(con

tinue

d)

Ext

erna

litie

s: c

osts

and

ben

efits

• So

cial

cos

t = p

rivat

e co

st +

ext

erna

l cos

t (po

llutio

n,

cong

estio

n).

• So

cial

ben

efit

= pr

ivat

e be

nefit

+ e

xter

nal b

enef

it (e

duca

tion,

he

alth

).

• G

over

nmen

t pol

icy

to d

eal w

ith e

xter

nalit

ies:

taxa

tion,

su

bsid

ies,

fines

, gov

ernm

ent r

egul

atio

n.

This

shou

ld fo

rm a

bas

is fo

r fur

ther

ana

lysi

s of p

rote

ctio

n of

the

envi

ronm

ent i

n Se

ctio

n C

of t

he su

bjec

t con

tent

, Gov

ernm

ent a

nd

the

Eco

nom

y.

Dia

gram

s are

not

req

uire

d.

Stud

ents

shou

ld c

onsi

der t

he e

ffect

s of e

xter

nalit

ies i

n re

latio

n to

fir

ms a

nd c

onsu

mer

s. Ap

plic

atio

n of

con

cept

s to

exam

ples

from

an

econ

omy

of y

our c

hoic

e.

2 C

ompe

titio

n C

ompe

titiv

e m

arke

ts

• A

dvan

tage

s and

dis

adva

ntag

es o

f com

petit

ion

to fi

rms,

cons

umer

s and

the

econ

omy:

eff

icie

ncy,

cho

ice,

qua

lity,

in

nova

tion.

• A

dvan

tage

s and

dis

adva

ntag

es o

f lar

ge a

nd sm

all f

irms.

• Fa

ctor

s inf

luen

cing

the

grow

th o

f firm

s; c

ause

s, ty

pes,

limita

tions

.

Emph

asis

on

mar

kets

hav

ing

vary

ing

degr

ees o

f com

petit

ion

depe

ndin

g up

on th

e nu

mbe

r of f

irm

s in

the

mar

ket.

A st

udy

of

perf

ect c

ompe

titio

n no

t req

uire

d.

Lim

itatio

ns sh

ould

incl

ude

size

of m

arke

t, ai

m o

f ent

repr

eneu

r an

d la

ck o

f fin

ance

.

M

onop

oly

• M

ain

feat

ures

: bar

riers

to e

ntry

, one

dom

inan

t sup

plie

r in

a m

arke

t.

• Le

gal d

efin

ition

(s).

• A

dvan

tage

s and

dis

adva

ntag

es o

f mon

opol

y: e

cono

mie

s of

scal

e, p

rodu

ct in

nova

tion,

pric

e, c

hoic

e, e

ffic

ienc

y.

Mod

ern

exam

ples

of b

arri

ers t

o en

try

from

an

econ

omy

of y

our

choi

ce b

ut n

o de

tail

requ

ired

.

Lega

l def

initi

on is

, for

exa

mpl

e ta

ken

as 2

5% m

arke

t sha

re.

Dia

gram

s not

requ

ired

but

abi

lity

to a

naly

se a

nd e

valu

ate

in

wri

ting

is re

quir

ed.

O

ligop

oly

• M

ain

feat

ures

: bar

riers

to e

ntry

, a fe

w, l

arge

firm

s dom

inat

e th

e m

arke

t, ca

rtels

, non

-pric

e an

d pr

ice

com

petit

ion.

• A

dvan

tage

s and

dis

adva

ntag

es o

f olig

opol

ies:

eco

nom

ies o

f sc

ale,

com

petit

ion,

col

lusi

on.

Anal

ysis

requ

ired

of m

oder

n ex

ampl

es o

f olig

opol

istic

pra

ctic

es

from

an

econ

omy

of y

our c

hoic

e, fo

r exa

mpl

e th

e ca

r ind

ustr

y in

Fr

ance

.

Dia

gram

s not

requ

ired

.

Spec

ifica

tion

– Ed

exce

l IG

CSE

in E

cono

mic

s (4E

C0)

– Is

sue

1 –

Sept

embe

r 200

8 ©

Ede

xcel

Lim

ited

2008

9

Con

cept

/idea

C

onte

nt

Illu

stra

tive

guid

ance

for

teac

hers

3 Pu

blic

and

pri

vate

se

ctor

s D

iffer

ence

s bet

wee

n pu

blic

and

pri

vate

sect

ors i

n te

rms o

f ow

ners

hip,

con

trol

, aim

s.

G

over

nmen

t reg

ulat

ion

• To

pro

mot

e co

mpe

titio

n: m

onop

oly

and

mer

ger c

ontro

l.

• To

influ

ence

loca

tion

of fi

rms:

solu

tion

to re

gion

al p

robl

ems

of u

nem

ploy

men

t, co

nges

tion,

inco

me

ineq

ualit

y.

Out

line

know

ledg

e of

com

petit

ion

polic

y in

a c

ount

ry o

f you

r ch

oice

.

Fact

ors a

ffect

ing

loca

tion

of in

dust

ry n

ot re

quir

ed.

Pr

ivat

isat

ion

Effe

cts o

f priv

atis

atio

n on

con

sum

ers,

wor

kers

, firm

s, go

vern

men

t an

d th

e ec

onom

y.

Abili

ty to

ana

lyse

mod

ern

exam

ples

requ

ired

, fro

m a

cou

ntry

of

your

cho

ice.

Spec

ifica

tion

– Ed

exce

l IG

CSE

in E

cono

mic

s (4E

C0)

– Is

sue

1 –

Sept

embe

r 200

8 ©

Ede

xcel

Lim

ited

2008

10

C G

over

nmen

t an

d th

e Ec

onom

y

Con

cept

/idea

C

onte

nt

Illu

stra

tive

guid

ance

for

teac

hers

1 M

acro

econ

omic

ob

ject

ives

Fi

ve m

acro

econ

omic

obj

ectiv

es: e

cono

mic

gro

wth

; inf

latio

n;

unem

ploy

men

t; ba

lanc

e of

pay

men

ts o

n cu

rren

t ac

coun

t; pr

otec

tion

of th

e en

viro

nmen

t. Th

ese

are

outli

ned

in g

reat

er d

etai

l be

low

.

Stud

ents

are

exp

ecte

d to

be

able

to u

nder

stan

d an

d an

alys

e si

mpl

e da

ta re

latin

g to

the

five

mac

roec

onom

ic o

bjec

tives

.

Stud

ents

shou

ld st

udy

regi

onal

pol

icy

in th

e co

ntex

t of t

he fi

ve

obje

ctiv

es.

E

cono

mic

gro

wth

• G

ross

Dom

estic

Pro

duct

(GD

P) a

s the

mea

sure

men

t of

econ

omic

gro

wth

: tot

al g

row

th a

nd ra

te o

f gro

wth

.

• Th

e ec

onom

ic c

ycle

: rec

over

y; b

oom

; rec

essi

on; s

lum

p.

Stud

ents

are

not

requ

ired

to h

ave

know

ledg

e of

nat

iona

l ac

coun

ting.

Som

e gr

asp

of th

e lim

itatio

ns o

f GD

P as

a m

easu

re is

ex

pect

ed.

In

flatio

n

• M

easu

rem

ent o

f inf

latio

n: R

etai

l Pric

e In

dex

(RPI

) or

Con

sum

er P

rice

Inde

x (C

PI).

• C

ause

s: d

eman

d pu

ll, c

ost p

ush,

mon

ey su

pply

.

• C

onse

quen

ces:

eff

ects

on

pric

es, s

avin

gs, w

ages

, bal

ance

of

paym

ents

, une

mpl

oym

ent,

the

func

tions

of m

oney

.

A de

taile

d kn

owle

dge

of th

e RP

I or C

PI is

not

requ

ired

; ana

lysi

s of

the

caus

es a

nd c

onse

quen

ces o

f inf

latio

n sh

ould

be

the

maj

or

focu

s.

Cha

ract

eris

tics o

f mon

ey a

re n

ot re

quir

ed.

U

nem

ploy

men

t

• In

tern

atio

nal L

abou

r Org

anis

atio

n (I

LO) m

easu

rem

ent o

f un

empl

oym

ent.

• Ty

pes —

cyc

lical

, stru

ctur

al, f

rictio

nal,

seas

onal

, vol

unta

ry.

Stud

ents

are

not

requ

ired

to h

ave

deta

iled

know

ledg

e of

un

empl

oym

ent f

igur

es b

ut sh

ould

be

able

to a

pply

and

ana

lyse

ty

pes o

f une

mpl

oym

ent.

Spec

ifica

tion

– Ed

exce

l IG

CSE

in E

cono

mic

s (4E

C0)

– Is

sue

1 –

Sept

embe

r 200

8 ©

Ede

xcel

Lim

ited

2008

11

Con

cept

/idea

C

onte

nt

Illu

stra

tive

guid

ance

for

teac

hers

1 M

acro

econ

omic

ob

ject

ives

(c

ontin

ued)

Bal

ance

of p

aym

ents

on

curr

ent a

ccou

nt

• D

efic

its a

nd su

rplu

ses.

• Tr

ade

in g

oods

(vis

ible

s) a

nd tr

ade

in se

rvic

es (i

nvis

ible

s)

Mod

ern

exam

ples

of t

he c

urre

nt a

ccou

nt, f

rom

a c

ount

ry o

f you

r ch

oice

, are

requ

ired

.

Pr

otec

tion

of th

e en

viro

nmen

t

• U

se o

f reg

ulat

ion

and

taxa

tion

to in

fluen

ce b

usin

ess a

nd

cons

umer

beh

avio

ur.

Stud

ents

shou

ld n

ote

that

exc

hang

e ra

tes a

re d

ealt

with

und

er

Sect

ion

D o

f the

subj

ect c

onte

nt, T

he G

loba

l Eco

nom

y.

Stud

ents

shou

ld b

e aw

are

that

the

envi

ronm

ent i

s inc

reas

ingl

y a

conc

ern

of g

over

nmen

ts.

Exte

rnal

cos

t/ben

efits

dia

gram

s are

not

requ

ired

.

2 Po

licie

s: to

dea

l w

ith e

cono

mic

gr

owth

, inf

latio

n,

unem

ploy

men

t, th

e ba

lanc

e of

pa

ymen

ts o

n cu

rren

t acc

ount

an

d th

e pr

otec

tion

of th

e en

viro

nmen

t

Polic

y in

stru

men

ts

Dem

and

side

• Fi

scal

: gov

ernm

ent r

even

ue a

nd e

xpen

ditu

re.

• R

even

ue: d

irect

and

indi

rect

taxa

tion.

• M

ain

area

s of p

ublic

sect

or sp

endi

ng.

• Ta

xatio

n, re

gula

tion

and

ince

ntiv

es a

imed

at t

he p

rote

ctio

n of

th

e en

viro

nmen

t.

• M

onet

ary:

– in

tere

st ra

tes a

nd m

oney

supp

ly

– ef

fect

s of i

nter

est r

ates

on

cons

umer

s’ a

nd fi

rms’

de

cisi

ons.

• M

oney

supp

ly: r

elat

ions

hip

with

inte

rest

rate

s and

infla

tion.

Stud

ents

are

not

requ

ired

to d

raw

dia

gram

s or t

o us

e Ag

greg

ate

Supp

ly/A

ggre

gate

Dem

and

mod

el (A

S/AD

) ana

lysi

s in

thei

r an

swer

s.

Stud

ents

shou

ld u

nder

stan

d th

at fi

scal

pol

icy

oper

ates

thro

ugh

gove

rnm

ent b

udge

ts a

nd a

ppre

ciat

e th

e lik

ely

impa

ct o

f a b

udge

t de

ficit

or su

rplu

s. D

etai

led

know

ledg

e of

any

spec

ific

budg

et is

no

t re

quir

ed.

Stud

ents

are

not

requ

ired

to h

ave

deta

iled

know

ledg

e of

mon

ey

supp

ly d

efin

ition

s.

Su

pply

side

• Su

pply

side

pol

icie

s: p

rivat

isat

ion;

der

egul

atio

n; e

duca

tion

and

train

ing;

pro

duct

ivity

of t

he w

orkf

orce

.

Stud

ents

shou

ld u

nder

stan

d th

at su

pply

side

pol

icie

s ope

rate

ove

r a

long

er te

rm th

an d

eman

d si

de p

olic

ies.

Spec

ifica

tion

– Ed

exce

l IG

CSE

in E

cono

mic

s (4E

C0)

– Is

sue

1 –

Sept

embe

r 200

8 ©

Ede

xcel

Lim

ited

2008

12

Con

cept

/idea

C

onte

nt

Illu

stra

tive

guid

ance

for

teac

hers

3 R

elat

ions

hip

betw

een

obje

ctiv

es

and

polic

ies

This

brin

gs to

geth

er

1 an

d 2.

• Th

e di

ffer

ent e

ffec

ts th

at m

acro

econ

omic

mea

sure

s may

hav

e on

the

five

mac

roec

onom

ic o

bjec

tives

.

• Th

ese

effe

cts w

ill b

e bo

th p

ositi

ve a

nd n

egat

ive,

and

may

in

volv

e tra

de-o

ffs b

etw

een

obje

ctiv

es a

nd is

sues

of e

quity

.

This

sect

ion

shou

ld n

ot b

e se

en a

s a se

para

te p

art.

Anal

ysis

and

ev

alua

tion

of o

bjec

tives

and

pol

icie

s sho

uld

be p

art o

f Sec

tions

C1

and

C2.

Stud

ents

are

exp

ecte

d to

be

able

to a

naly

se a

nd e

valu

ate

the

effe

ctiv

enes

s of d

iffer

ent p

olic

ies i

n a

vari

ety

of e

cono

mic

si

tuat

ions

.

Spec

ifica

tion

– Ed

exce

l IG

CSE

in E

cono

mic

s (4E

C0)

– Is

sue

1 –

Sept

embe

r 200

8 ©

Ede

xcel

Lim

ited

2008

13

D

The

Glo

bal E

cono

my

Con

cept

/idea

C

onte

nt

Illu

stra

tive

guid

ance

for

teac

hers

1 G

loba

lisat

ion

• Th

e in

crea

sing

inte

grat

ion

and

inte

rdep

ende

nce

of n

atio

nal

econ

omie

s.

• M

NC

s (m

ulti-

natio

nal c

ompa

nies

) sou

rce

fact

ors,

prod

uce

and

sell

in v

ario

us c

ount

ries.

• R

easo

ns fo

r glo

balis

ed o

pera

tions

; key

driv

ers i

n gl

obal

ec

onom

y, in

clud

ing

role

of I

CT,

tran

spor

t and

tour

ism

.

• FD

I (fo

reig

n di

rect

inve

stm

ent)

and

deve

lopm

ent a

id a

s fa

ctor

s enc

oura

ging

glo

balis

atio

n.

• W

inne

rs a

nd lo

sers

from

glo

balis

atio

n:

– M

NC

s and

dev

elop

ed c

ount

ries

– in

tern

atio

nal d

ebt,

com

mod

ity p

rices

and

livi

ng st

anda

rds

in d

evel

opin

g co

untri

es

– ef

fect

on

the

deve

lopm

ent g

ap

– im

pact

s on

the

natu

ral e

nviro

nmen

t.

Stud

y of

the

glob

al o

pera

tions

of a

nam

ed M

NC

(MN

Cs i

nclu

de

maj

or b

anks

).

Stud

ents

shou

ld a

lso

unde

rsta

nd th

e ro

le o

f the

gov

ernm

ent i

n gl

obal

isat

ion.

Anal

ysis

and

eva

luat

ion

of m

oder

n ex

ampl

es o

f inw

ard

inve

stm

ent

into

a c

ount

ry o

f you

r cho

ice,

of a

dev

elop

men

t aid

pro

ject

, and

of

the

effe

cts o

f deb

t and

exp

ort p

rice

s for

com

mod

ities

on

livin

g st

anda

rds i

n an

y na

med

dev

elop

ing

coun

try.

2 In

tern

atio

nal t

rade

Gro

wth

and

cha

nge

in in

tern

atio

nal t

rade

• Si

gnifi

canc

e of

trad

e in

goo

ds a

nd se

rvic

es:

– fo

r cho

ice

and

com

petit

ion

– fo

r gro

wth

and

GD

P.

• Fr

ee tr

ade

and

prot

ectio

n: ta

riffs

, quo

tas a

nd su

bsid

ies f

or

natio

nal s

ecur

ity o

r dom

estic

em

ploy

men

t rea

sons

.

The

Law

of C

ompa

rativ

e Ad

vant

age

not r

equi

red.

Stud

ents

shou

ld h

ave

know

ledg

e of

the

adva

ntag

es a

nd

disa

dvan

tage

s of f

ree

trad

e an

d pr

otec

tion.

Basi

c su

pply

and

dem

and

diag

ram

s to

show

the

impa

ct o

f tar

iffs,

subs

idie

s and

quo

tas o

n fo

reig

n tr

ade

are

requ

ired

.

Spec

ifica

tion

– Ed

exce

l IG

CSE

in E

cono

mic

s (4E

C0)

– Is

sue

1 –

Sept

embe

r 200

8 ©

Ede

xcel

Lim

ited

2008

14

Con

cept

/idea

C

onte

nt

Illu

stra

tive

guid

ance

for

teac

hers

2 In

tern

atio

nal t

rade

(c

ontin

ued)

C

hang

ing

patt

erns

of w

orld

trad

e:

• M

oder

n tra

ding

blo

cs —

eff

ects

of b

loc

on m

embe

r and

non

-m

embe

r cou

ntrie

s.

• Th

e W

TO (W

orld

Tra

de O

rgan

izat

ion)

and

gro

wth

of

inte

rnat

iona

l tra

de

• C

ontra

st b

etw

een

deve

lope

d an

d de

velo

ping

cou

ntrie

s.

Stud

ents

will

nee

d m

oder

n ex

ampl

es o

f the

invo

lvem

ent i

n w

orld

tr

ade

of a

cou

ntry

of y

our c

hoic

e. N

amed

exa

mpl

es o

f reg

iona

l tr

ade

bloc

s.

Stud

ents

shou

ld b

e ab

le to

reca

ll ex

ampl

es o

f WTO

act

ion

and

its

effe

cts.

3 E

xcha

nge

rate

s T

he w

orld

wid

e si

gnifi

canc

e of

exc

hang

e ra

tes

• Fa

ctor

s aff

ectin

g ex

chan

ge ra

tes t

hrou

gh d

eman

d fo

r and

su

pply

of c

urre

ncie

s:

– im

ports

and

exp

orts

of g

oods

and

serv

ices

– in

tere

st ra

tes

– cu

rren

cy sp

ecul

atio

n.

• Im

pact

of e

xcha

nge

rate

cha

nges

on:

– im

port

and

expo

rt pr

ices

– ba

lanc

e of

pay

men

ts o

n cu

rren

t acc

ount

.

• C

urre

ncy

depr

ecia

tion/

deva

luat

ion

as c

urre

nt a

ccou

nt d

efic

it po

licy.

Stud

ents

will

nee

d m

oder

n ex

ampl

es o

f the

wor

ld’s

pri

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Assessment

Assessment summary Paper 1 is externally assessed through an examination paper.

Summary of table of assessment

Paper 1: Economics Paper code: 4EC0/01

• The assessment of this qualification is through an examination paper lasting two hours and 30 minutes, set and marked by Edexcel.



Assessment Objectives and weightings % in IGCSE

AO1: demonstrate knowledge and understanding of the specified subject content

30-35%

AO2: apply knowledge and understanding using appropriate terms, concepts, theories and methods effectively to address problems and issues

30-35%

AO3: select, organise, analyse and interpret information from various sources to analyse problems and issues

15-20%

AO4: evaluate evidence, make reasoned judgements and present conclusions accurately and appropriately.

15-20%

TOTAL 100%


Entering your students for assessment

Student entry

Details of how to enter students for this qualification can be found in Edexcel’s International Information Manual, copies of which (in CD format) are sent to all active Edexcel centres. The information can also be found on Edexcel’s international website: www.edexcel-international.org/sfc/academic/infomanual

Combinations of entry

There are no forbidden combinations.

Access arrangements and special requirements

Edexcel's policy on access arrangements and special considerations for GCE, GCSE, IGCSE, and Entry Level qualifications aims to enhance access to the qualifications for students with disabilities and other difficulties without compromising the assessment of skills, knowledge, understanding or competence.

Please see the Edexcel website (www.edexcel.org.uk/sfc) for:

• the Joint Council for Qualifications (JCQ) policy Access Arrangements and Special Considerations, Regulations and Guidance Relating to Students who are Eligible for Adjustments in Examinations

• the forms to submit for requests for access arrangements and special considerations

• dates for submission of the forms.

Requests for access arrangements and special considerations must be addressed to:

Special Requirements Edexcel One90 High Holborn London WC1V 7BH

Assessing your students The first assessment opportunity for Paper of this qualification will take place in the June 2011 series and in each following June and January series for the lifetime of the specification.

Your student assessment opportunities

Paper June 2011 January 2012 June 2012 January 2013

Paper 1: Economics


Awarding and reporting

The grading, awarding and certification of this qualification will follow the processes outlined in the current GCSE/GCE Code of Practice for courses starting in September 2009, which is published by the Qualifications and Curriculum Authority (QCA). The IGCSE qualification will be graded and certificated on an eight-grade scale from A* to G.

Students whose level of achievement is below the minimum standard for Grade G will receive an unclassified U. Where unclassified is received it will not be recorded on the certificate.

The first certification opportunity for the Edexcel IGCSE in Economics will be 2011.

Students whose level of achievement is below the minimum judged by Edexcel to be of sufficient standard to be recorded on a certificate will receive an unclassified U result.

Language of assessment

Assessment of this specification will be available in English only. Assessment materials will be published in English only and all work submitted for examination and moderation must be produced in English.

Malpractice and plagiarism

For up-to-date advice on malpractice and plagiarism, please refer to the JCQ’s Suspected Malpractice in Examinations: Policies and Procedures document on the JCQ website www.jcq.org.uk/

Student recruitment Edexcel’s access policy concerning recruitment to our qualifications is that:

• they must be available to anyone who is capable of reaching the required standard

• they must be free from barriers that restrict access and progression

• equal opportunities exist for all students.

Progression This qualification supports progression to:

• Edexcel AS/Advanced GCE in Economics and AS/Advanced GCE in Economics and Business Studies

• Level 3 BTEC Nationals in Business and other qualifications.

http://www.jcq.org.uk/


Grade descriptions Grade descriptions are provided to give a general indication of the standards of achievement likely to have been shown by candidates awarded particular grades. The descriptions must be interpreted in relation to the specification content; they are not designed to define that content. The grade awarded will depend in practice upon the extent to which the candidate has met the Assessment Objectives overall. Shortcomings in some aspects of the assessment may be balanced by better performance in others.

Grade A

Candidates can:

• demonstrate in-depth knowledge and critical understanding of the full range of the specification content

• apply this knowledge and critical understanding, using terms, concepts, theories and methods effectively to address problems and issues

• select and organise information from a wide variety of sources and interpret and use this information effectively to analyse problems and issues with a high degree of accuracy

• evaluate evidence, making reasoned judgements, and present conclusions accurately and appropriately.

Grade C

Candidates can:

• demonstrate knowledge and understanding of most aspects of the specification content

• apply this knowledge and understanding, using terms, concepts, theories and methods appropriately to address problems and issues

• select, organise, interpret and use information to analyse problems and issues with some accuracy

• make reasoned judgements and present conclusions that are supported by evidence.

Grade F

Candidates can:

• demonstrate knowledge and understanding of some aspects of the specification content

• apply this knowledge and understanding, using some terms, concepts, theories and methods to address problems and issues

• show some ability to select, organise, interpret and use simple information

• make judgements and present simple conclusions that are sometimes supported by evidence.


Support and training

Edexcel support services Edexcel has a wide range of support services to help you implement this qualification successfully.

ResultsPlus — ResultsPlus is an application launched by Edexcel to help subject teachers, senior management teams, and students by providing detailed analysis of examination performance. Reports that compare performance between subjects, classes, your centre and similar centres can be generated in ‘one-click’. Skills maps that show performance according to the specification topic being tested are available for some subjects. For further information about which subjects will be analysed through ResultsPlus, and for information on how to access and use the service, please visit www.edexcel.org.uk/resultsplus

Ask the Expert — Ask the Expert is a new service, launched in 2007, that provides direct email access to senior subject specialists who will be able to answer any questions you might have about this or any other specification. All of our specialists are senior examiners, moderators or verifiers and they will answer your email personally. You can read a biography for all of them and learn more about this unique service on our website at www.edexcel.org.uk/asktheexpert

Ask Edexcel — Ask Edexcel is Edexcel’s online question and answer service. You can access it at www.edexcel.org.uk/ask or by going to the main website and selecting the Ask Edexcel menu item on the left.

The service allows you to search through a database of thousands of questions and answers on everything Edexcel offers. If you don’t find an answer to your question, you can choose to submit it straight to us. One of our customer services team will log your query, find an answer and send it to you. They’ll also consider adding it to the database if appropriate. This way the volume of helpful information that can be accessed via the service is growing all the time.

Examzone — The Examzone site is aimed at students sitting external examinations and gives information on revision, advice from examiners and guidance on results, including re-marking, re-sitting and progression opportunities. Further services for students — many of which will also be of interest to parents — will be available in the near future. Links to this site can be found on the main homepage at www.examzone.co.uk

Training A programme of professional development and training courses, covering various aspects of the specification and examination, will be arranged by Edexcel. Full details can be obtained from our website: www.edexcel.org.uk

http://www.edexcel.org.uk/asktheexpert

http://www.edexcel.org.uk/ask

http://www.examzone.co.uk/

http://www.edexcel.org.uk/


Textbooks and resources There are few recent economics textbooks available but the following titles are suitable for the basic theory and concepts. Dictionaries of economics terms are useful for definitions of the concepts contained in the specification. All resources are suggested as possible teaching aids only, and are not required reading for the course. The internet is valuable as a tool for research and learning. There is a variety of aids for students and teachers, including revision notes and case studies for the UK GCSE which can be adapted for IGCSE.

Please note that while resources are checked at the time of publication, materials may be withdrawn from circulation and website locations may change at any time.

Textbooks

Anderton A — Economics for GCSE, 2nd Edition (Collins, 1993) ISBN 0003274292

Bannock G — The Penguin Dictionary of Economics (Penguin, 1999) ISBN 0140513760

Black J — A Dictionary of Economics (Oxford Paperbacks, 1997) ISBN 0192800183

Moynihan D and Titley B — Economics: A Complete Course, 3rd Edition (Oxford University Press, 2001) ISBN 0199134138

Paisley and Quillfeldt — GCSE Economics (Longman, 1987) ISBN 0582005205

Pass C — Collins Dictionary of Economics (HarperCollins, 2000) ISBN 0004724739

Pratten J — GCSE Economics (Liverpool Academic Press, 2001) ISBN 1872807739

Websites

General websites

www.bbc.co.uk As well as topical issues there is also an education section.

www.bized.ac.uk Originally designed for business studies and now incorporates a wealth of useful information for both teachers and students.

www.s-cool.co.uk Although only available for AS/A level, many topics also apply to the IGCSE specification and are dealt with simply with revision questions.

www.tutor2u.net Originally for AS/A2 but developing more resources for GCSE level.

Current economic issues and statistical data

www.ebea.org.uk designed for teachers developing materials for themselves and students

www.economist.com Economist magazine

www.ft.com Financial Times newspaper

www.guardian.co.uk Guardian newspaper


UK data

www.bankofengland.co.uk For information on current interest rates and the UK’s financial system.

www.direct.gov.uk The website of the UK government, providing information for citizens from various government departments.

www.hm-treasury.gov.uk The UK’s economic and finance ministry. Access to budget reports and policy information.

www.statistics.gov.uk Holds all national statistics, for example economy, census, population, labour market.

World data

www.europa.eu.int/en/comm Holds statistics on all nations in the European Economic /eurostat Community.

www.oecd.org The website holds comparable statistics, economic and social data from countries committed to democracy and market economy.

www.worldbank.org Source of loans, credits and grants to developing countries. Website has a section on world data and research.

www.wto.org The World Trade Organization deals with rules of trade between nations. Includes a section on trade statistics.

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September 2008 For more information on Edexcel and BTEC qualifications please visit our website: www.edexcel.org.uk Edexcel Limited. Registered in England and Wales No. 4496750 Registered Office: One90 High Holborn, London WC1V 7BH. VAT Reg No 780 0898 07

http://www.edexcel.org.uk/

Documents

Edexcel IGCSE 2009 - Wikispacesdcszeconomics.wikispaces.com/file/view/IGCSE+Economics... · Introduction The Edexcel International General Certificate of Secondary Education (IGCSE)