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Edexcel A-level Economics A

Theme 1: Introduction to markets and market failure

The Ceteris modules for Edexcel A-level economics, Introduction to markets and market failure, listed under each specification section. Each module teaches one idea, with questions through the page.

1.1 Nature of economics

Scarcity and choiceSay why every choice means giving something upConcept · 7 min · FreeOpportunity costSay what a choice costs, not just what it costs in moneyConcept · 6 minThe production possibility frontierRead a PPF and say what a point inside it meansDiagram · 7 minPositive and normative statementsTell a positive statement from a normative oneTell them apart · 6 minSpecialisation and the division of labourSay what specialisation is and why it raises outputConcept · 6 minFactors of productionSort an input into the right factor of productionTell them apart · 6 minMarket, command and mixed economiesTell the three ways an economy can allocate resourcesTell them apart · 7 minWhat money is forName the functions of money and tell money from wealthConcept · 7 min · Free

1.2 How markets work

Do people actually decide rationally?Weigh the case each way on the rational-choice assumptionDebate · 7 minDemandTell demand from quantity demandedConcept · 6 min · FreeSupplyTell supply from quantity suppliedConcept · 6 minHow a market finds its priceExplain how a market moves to its equilibrium priceHow it works · 6 minA shift in demandTell a shift in demand from a movement along the curveDiagram · 7 minA shift in supplyTell a shift in supply from a movement along the curveDiagram · 8 minElastic and inelastic demandTell elastic demand from inelastic demandTell them apart · 6 minCalculating price elasticity of demandWork out a price elasticity of demand from two percentagesCalculation · 6 minPrice elasticity of supplySay what makes a supply elastic or inelasticConcept · 7 minIncome and cross elasticityTell a normal good from an inferior one, and a substitute from a complementTell them apart · 7 minConsumer and producer surplusRead consumer and producer surplus off a diagramDiagram · 6 minWhat a price does: rationing, signalling, incentiveExplain the three jobs a price does in a marketHow it works · 6 minAn indirect tax on a diagramShow what an indirect tax does to price and quantityDiagram · 7 minSubsidiesShow what a subsidy does to price and quantityDiagram · 7 min

1.3 Market failure

Public goodsTell a public good from a private oneConcept · 6 min · FreeNegative externalitiesShow why a market over-produces when there is an external costDiagram · 8 minPositive externalitiesShow why a market under-produces when there is an external benefitDiagram · 7 minMerit and demerit goodsTell a merit good from a demerit good, and both from a public goodTell them apart · 7 minAsymmetric informationSay what asymmetric information is and how it breaks a marketConcept · 6 min

1.4 Government intervention

An indirect tax on a diagramShow what an indirect tax does to price and quantityDiagram · 7 minSubsidiesShow what a subsidy does to price and quantityDiagram · 7 minPrice ceilings and price floorsSay what a binding ceiling or floor does to a marketDiagram · 6 minTradable pollution permitsWeigh permits against a tax as a way of cutting pollutionDebate · 6 minGovernment failureSay what government failure is and name the forms it takesConcept · 7 min