Understand demand-pull and explanations of inflation. The causes are generally broadly well understood by this point, but spending some time on the wage-price spiral and expectations can be Explain and evaluate the quantity valuable in escaping a diagrammatic understanding, as well as looking at theory of money. the Bank’s inflation reports. The quantity theory is a useful tool to revisit QE (if you didn’t teach it at the time) and a contrast between Zimbabwe and the Learners should understand the UK/US can be interesting in terms of when printing money does or doesn’t role of expectations in sustaining trigger inflation and why/why not. and driving inflation through mechanisms such as the Solutions can be an interesting research piece as different approaches can spiral. be contrasted for inflation. At the time of writing, deflation is mainly just Japan, but the policy decisions of the Eurozone must also merit Appreciate that rising prices can consideration here. create costs, but that these costs will depend on the level of inflation, Diagrammatic approaches are very useful here. the cause of inflation and the extent to which it was anticipated. Costs include redistributive effects, macroeconomic effects and efficiency effects. Explain and evaluate possible responses to the issue of inflation in terms of how effective or desirable solutions are likely to be. Understand that, as with inflation, deflation may be either demand side or supply side driven and the effects will depend upon the –
Understand demand-pull and explanations of inflation. Explain and evaluate the quantity theory of money. Learners should understand the role of expectations in sustaining and driving inflation through mechanisms such as the spiral. Appreciate that rising prices can create costs, but that these costs will depend on the level of inflation, the cause of inflation and the extent to which it was anticipated. Costs include redistributive effects, macroeconomic effects and efficiency effects. Explain and evaluate possible responses to the issue of inflation in terms of how effective or desirable solutions are likely to be. Understand that, as with inflation, deflation may be either demand side or supply side driven and the effects will depend upon the – The causes are generally broadly well understood by this point, but spending some time on the wage-price spiral and expectations can be valuable in escaping a diagrammatic understanding, as well as looking at the Bank’s inflation reports. The quantity theory is a useful tool to revisit QE (if you didn’t teach it at the time) and a contrast between Zimbabwe and the UK/US can be interesting in terms of when printing money does or doesn’t trigger inflation and why/why not. Solutions can be an interesting research piece as different approaches can be contrasted for inflation. At the time of writing, deflation is mainly just Japan, but the policy decisions of the Eurozone must also merit consideration here. Diagrammatic approaches are very useful here.
Eduqas%20Economics%20Course%20Outline%20(from%20September%202015).docx