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This site is for you to learn, to master and to develop confidence in writing essay for A level Economics. Hi there, you desperate kids, I understand the struggles and pain. Yup, I feel you. Hope this site can provide some soothing balm.

The essay questions here closely resemble the original CAIE questions, but they are not the same. Copyright issues. But no worry. The questions here are all original, more thoughtful and present greater excitement and challenge than Cambridge.

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And before I go, never forget to have fun! Fun in learning, through discovering and savouring all those ‘aha moment’, understanding more of the world we live in, the behaviour of people around us, and of ourselves. Yes, Economics is fun.

Bye bye and have a nice day.

Wong Wai Leong,

Economics teacher

Developing countries (A2 w16)

(a) Explain what is most in need of development in a developing economy. [12]

(b) Discuss how easy it is to compare the standard of living between developing and developed countries. [13]

Developmental economics and living standards (A2 w17)

‘The measurement of living standards is problematic. It is never certain that people in one country are better off than those in another. The classification of countries into developing and developed is, therefore, never clear.’

Do you agree with this argument? [25]

Living standards indicators (A2 w19)

‘The Human Development Index (HDI) is a more useful indicator of changes in living standards than changes in Gross Domestic Product (GDP) but it still does not provide an entirely accurate assessment of whether living standards have improved over a given time period.’

Critically evaluate this statement. [25]

Developmental economics (A2 s20)

(a) ‘Developing countries have low levels of productivity and a high dependency ratio.’

Explain the meaning of these two characteristics and consider whether they are linked. [12]

(b) Assess the view that foreign direct investment remains the key to economic growth in developing countries. [13]

Fiscal policy and Keynesian economics (A2 w18)

Recession in some economies has caused high unemployment. At the same time high levels of national debt and substantial budget deficits have been experienced.

This means that governments can no longer use Keynesian demand management policies to solve the problem of unemployment.

To what extent do you agree with this conclusion? [25]

Quantitative easing and monetary policy (A2 s19)

‘The failure of the policy of quantitative easing (QE) to solve problems associated with an economic recession illustrates the weakness of monetary transmissions mechanisms in particular and monetary policy in general.’

Critically evaluate this statement. [25]

Monetary policy and fiscal policy (A2 w19)

(a) Discuss the effects of an expansionary monetary policy on the demand for money. [12]

(b) How far do you agree with the view that an expansionary fiscal policy will reduce the level of unemployment in the short run but it will cause inflation to accelerate and unemployment to rise in the long run? [13]

Inflationary gap and monetarypolicy (A2 s20)

(a) Explain what economists mean by an inflationary gap and discuss why this is considered to be an economic problem. Use a diagram(s) to support your answer. [12]

(b) How far would you agree that the use of monetary policy is the most effective way to solve the problem of an inflationary gap? [13]

Unemployment and supply-side policies (A2 w20)

(a) Explain the economic costs of unemployment and consider which is the most important. [12]

(b) ‘Government intervention in supply-side policies will not have a significant impact on unemployment whereas supply-side policies that increase aggregate demand because of a freer market will significantly reduce the level of unemployment.’

Discuss this statement. [13]

Fiscal policy and LPT (A2 w15)

(a) Explain why the government’s annual budget is an important instrument of economic policy. [12]

(b) Analyse whether there is a link between the reasons given by the liquidity preference theory as to why people demand money and the rate of interest. [13]

Macroeconomic objectives (A2 w16)

(a) Explain three major government macroeconomic policy aims and describe why there may be a conflict in trying to achieve them at the same time. [12]

(b) Governments are sometimes concerned with microeconomic issues, for example, planning applications for large projects such as airports which have environmental implications. Discuss how a government’s decision on a microeconomic issue might have macroeconomic implications. [13]

Liquidity Preference Theory and inflation (A2 s17)

(a) Explain the reasons why people demand money according to the liquidity preference theory. Consider which reason is the most important. [12]

(b) In 2015, after a period of low inflation and low interest rates a commentator wrote, ‘If inflation suddenly increases it could result in a faster than expected rise in interest rates. The consumer spending boom will end.’ (Source: London Evening Standard, 26 January 2015)

Discuss the possible reasons behind this suggested result. [13]