Now, students should know that the A Level Economics exam is as much an assessment of a student’s content knowledge, as it is a test of a student’s exam skills. Hence, subsumed within this article is a collection of exam-smart tips to helping you achieve an 'A' for your economics examinations.
Tip 1 – Impact of an event
Across the entire Economics syllabus, students are often asked to assess the impact of an event on a subject.
In addressing questions like these, it helps to understand the scope of the requisite analysis.
Tip 2 – Stitching policies together
There are 3 parts in the JC Economics syllabus where students have to discuss policy recommendations – (i) demand and supply (price controls, taxes and subsidies); (ii) market failure (taxes and subsidies, campaigns, regulation, etc); and (iii) macro problems (demand-management policies, supply-side policies)In presenting the policies, students need to be able to stitch the policies together in a coherent way. There are two ways to do this:
1. Expose limitations of the preceding policy such that complementary policies are needed
- the preferred approach to make a good more affordable is to use subsidies. But if the government lacks the budget to finance a subsidy, a price ceiling needs to be considered.
- the preferred approach to internalise a spillover cost is through taxes. But if PED<1 (e.g. addiction to cigarettes), campaigns which encourage the use of substitutes such as nicotine gum are needed.
- the preferred approach to tackle a recession is through expansionary fiscal and monetary policies. But if the country is primarily driven by exports, a weakening of the exchange-rate may be more effective.
2. Highlight >1 root cause of the problem such that a combination of policies is needed
- to tackle market failure in merit goods, subsidies (to tackle externality), education (to tackle imperfect information) and targeted subsidies (to tackle inequity) are required
- to reduce unemployment, demand-management policies (to tackle cyclical unemployment) and supply-side policies (to tackle structural unemployment) are required.
Tip 3 -focus on economic analysis
In writing Economics essays, time is always against the student. Given the scarcity of time, it is imperative to know the areas where more time should be spent explaining content, and the areas where a succinct explanation would suffice. A general rule of thumb is that content requiring economic analysis should be given more weight. We can view these as content anchors.
This can be thought of as a 70/30 rule. Two examples are presented below:
Theory of CA contains valuable economic analysis. Students should explain its assumptions, compare opportunity cost ratios, and derive the gains from trade.
contains valuable economic analysis. Students should explain its assumptions, compare opportunity cost ratios, and derive the gains from trade.
Tip 4- sanity check
This is a very useful, but often neglected trick. Essentially, it means to look at your topic sentences and ask whether you are answering the question in the most direct way possible. Some paragraphs are meant to provide background information and may not answer the question directly. However, as a rule of thumb, at least 70% of your topic sentences should pass the sanity check (i.e. too much background information does not contribute towards answering the question).
Explain why the price of fuel tends to be more volatile than other secondary products. (10m)
Don't: Topic Sentence (Version 1): The PED of fuel is affected by a number of factors, including its degree of necessity. Supply of fuel is also affected by a number of different factors.
Do: Topic Sentence (Version 2): Demand for fuel is price-inelastic due to its nature as a necessity. Supply may also fluctuate given unstable conditions in the Middle East, a major oil producing region. An unstable supply curve coupled with an inelastic demand curve would lead to wide and frequent fluctuations in price.
Tip 5- Remembering content
When studying concepts with considerable content (e.g. elasticity concepts, economies of scale, barriers to entry, etc), students should follow a DDEE framework to ensure completeness in their answers.
Studying content this way makes the student’s preparation more “application-friendly”. This is because the student’s content understanding is now segmented according to key pivots. For example, a student who simply memorises chunks of information from the notes will find it hard to address the following essay question: “Differentiate between internal and external economies of scale (10m)”
However, application of DDEE can generate the essay structure immediately.
Definition: Internal EOS are reaped due to growth of the firm while external EOS are independent of firm size and are attributed to growth of the industry.
Diagram: Internal EOS is seen diagrammatically as a movement downwards along the long run average cost curve (LRAC) while external EOS manifests as a downward shift of the entire LRAC.
Explanation / Examples: Sources of internal EOS include technical, marketing, financial or managerial economies. On the other hand, external EOS takes the form of economies of information, concentration or disintegration.
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