O/L Unit 2: The allocation of resources: how the market works; market failure

Topic #	Topic	Outcome
2.1	The allocation of resources	Describe the allocation of resources in: • market economic systems • mixed economic systems
2.2	Sectors of an Economy	Describe the terms used for sectors in an economy: • Primary • Secondary • Service (tertiary)
2.3	The principle of equilibrium price	• Demonstrate the principle of equilibrium price • Analyse simple market situations with changes in demand and supply
2.4	Changes in demand and supply conditions	• Describe the causes of changes in demand and supply conditions • Analyse such changes to show effects in the market
2.5	Price elasticity of demand and supply	• Define price elasticity of demand • Define price elasticity of supply • Perform calculations
2.6	Usefulness of price elasticity of demand and supply	Demonstrate the usefulness of price elasticity in particular situations, such as in relation to: • revenue changes • consumer expenditure
2.7	The market system	Evaluate the merits of the market system
2.8	Market failure	• Describe the concept of market failure • Explain the reasons for its occurrence
2.9	Private and social costs and benefits	• Define private and social costs • Define private and social benefits • Discuss conflicts of interest in relation to these costs and benefits in the short-term and long-term through studies of the following issues: (i) conserving resources versus using resources (ii) public expenditure versus private expenditure