1. 22 October Agenda Assess sample Paper 1(a) answers Continue with Monetary Policy – Informal assessment of relevant diagrams Hand in portfolios by this Friday (through Unit 6) This Week and Next Week: Monetary Policy (2.5)

2. Paper 1(a) Question: Using supply and demand analysis explain why the price of agricultural goods tends to fluctuate more than the price of manufactured goods. (10 marks) What economics concepts are relevant? What terms should be defined? What diagrams should be drawn? What examples are needed? What should be explained?

3. Paper 1(a) Question: Using supply and demand analysis explain why the price of agricultural goods tends to fluctuate more than the price of manufactured goods. (10 marks) Individually assess Samples A, B and C. Include both comments and marks on the rubric. Discuss the samples in your group and try to reach consensus (agreement). Be prepared to defend your assessments with the rest of the class.

4. Sample A: 2/10 Examiners report: The student showed little understanding of the specific demands of the question. There was little recognition of relevant economic theory and none of the relevant terms were defined. There were significant errors. This puts the response into level 1 and explains the 2 marks given. The student never seemed to understand the terms being used and this could be seen from the lack of definitions and the confusion between “productivity of the good”, “price of productivity”, “production costs”, and “production price.” The student also wrote away from the point and did not engage with the question being asked and so level 2 could not be awarded.

5. Sample B: 5/10 Examiners report: The student showed some understanding of the specific demands of the question and recognized some of the relevant theory. Some relevant terms were defined, but not all. There were errors in the explanation. This puts the response clearly into level 2 and explains the 5 marks given. The main weakness was a lack of planning and insufficient explanation. The diagrams were rather simplistic and there was no direct comparison of the relative elasticity values between manufactured and agricultural goods so level 3 could not be awarded.

6. Sample A: 8/10 Examiners report: The student understood the specific demands of the question and explained and developed relevant theory. Economic terms were defined in all cases and there were no significant errors. Some diagrams were introduced and explained. This puts the response clearly into level 3 and explains the mark of 8. The student concentrated too much upon agricultural goods and their prices and did not really go into enough detail regarding manufactured goods. No examples were given and there was no use of a diagram to show the relatively elastic demand, so level 4 could not be awarded.

7. IA Commentaries - Drafts SL 2nd Commentary - 27-30 Oct SL 3rd Commentary - 25-29 Jan Final IA portfolio: 22-26 February

8. This Autumn -23 October (Paper 2 Development) -1.4 -2.1-2.3 -4.1-4.3 -27-30 October (Draft of 2 nd IA Commentary) November – Sections 2.5-2.6 / Start 3.1

9. Syllabus Item 121 Explain how changes in interest rates can influence the level of aggregate demand in an economy. Describe the mechanism through which easy (expansionary) monetary policy can help an economy close a deflationary (recessionary) gap. Construct a diagram to show the potential effects of easy (expansionary) monetary policy, outlining the importance of the shape of the aggregate supply curve. Describe the mechanism through which tight (contractionary) monetary policy can help an economy close an inflationary gap. Construct a diagram to show the potential effects of tight (contractionary) monetary policy, outlining the importance of the shape of the aggregate supply curve.

10. Draw diagrams for each of the following cases: 1.Monetary policy used to close deflationary gap (Keynesian model) 2.Monetary policy used to close inflationary gap (Keynesian model) 3.Monetary policy used to close deflationary gap (Monetarist model) 4.Monetary policy used to close inflationary gap (Monetarist model)

11. Consolidate your knowledge and understanding of unemployment: Complete Workpoint 17.8 on p. 220 Please share as a Google Doc.

12. Syllabus http://ibeconomics-isd.weebly.com/

13. Monetary Policy A monetarist would argue that monetary policy is most effective through the use of A.inflation targets. B.discretionary demand management. C.tax cuts. D.reducing the budget deficit. From: Multiple Choice Questions for Economics

14. EU Zone – Many countries / One monetary policy http://krugman.blogs.nytimes.com/2013/06/03/th e-macroeconomics-of-european-disunion/ http://www.unc.edu/depts/europe/euroeconomics /Monetary%20Policy%20ECB%20Challenges.php http://krugman.blogs.nytimes.com/2012/06/24/rev enge-of-the-optimum-currency-area/ http://krugman.blogs.nytimes.com/2012/07/29/int ernal-devaluation-inflation-and-the-euro- wonkish/?module=Search&mabReward=relbias%3A r%2C%7B%221%22%3A%22RI%3A8%22%7D