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

Topic #
The allocation of resources
Describe the allocation of resources in:
• market economic systems
• mixed economic systems
Sectors of an Economy
Describe the terms used for sectors in an economy:
• Primary
• Secondary
• Service (tertiary)
The principle of equilibrium price
• Demonstrate the principle of equilibrium price
• Analyse simple market situations with changes in demand and supply
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
Price elasticity of demand and supply
• Define price elasticity of demand
• Define price elasticity of supply
• Perform calculations
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
The market system
Evaluate the merits of the market system
Market failure
• Describe the concept of market failure
• Explain the reasons for its occurrence
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
Ahmed Xahir
Ahmed Xahir

This is a short biography of the post author. Maecenas nec odio et ante tincidunt tempus donec vitae sapien ut libero venenatis faucibus nullam quis ante maecenas nec odio et ante tincidunt tempus donec.