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Government policies · Part 2 of 2
9 exam-style questions with model answers, plus 14 quick multi-choice questions — every question on this part of the standard, grouped by the 3 pages of notes they come from.
Write a full answer before you reveal the model one. That comparison is where the learning happens.
Explain what a flow-on effect is, and state how many the standard requires and on how many issues.
The government increases spending to reduce unemployment.
Explain in detail the flow-on effect on inflation and on the balance on goods and services.
The RBNZ raises the OCR sharply to reduce inflation, and the negative flow-ons on unemployment and on international trade are severe.
Compare and contrast the two flow-ons, and give a reasoned judgement about which is the more serious cost of the policy.
State the three things the Excellence criterion requires, and explain why a single policy cannot meet it.
Explain in detail why supply-side policy is the most useful tool for minimising the negative flow-on effects of demand-side policy.
Unemployment in New Zealand has risen sharply during a downturn, and is concentrated in two regions where a major employer has closed.
Justify a combination of government policies that reduces unemployment while minimising negative flow-on effects on inflation and on the balance on goods and services. Refer to economic models throughout.
State what AS91227 requires for Achieved, and state what Excellence adds.
Explain in detail what it means to integrate changes shown on economic models into an explanation, and why the flow-on sections need models just as much as the direct impact does.
Two students write AS91227 reports on the same issue. Student A writes ten pages, nine of them on how the RBNZ's OCR decision reduces inflation, with excellent diagrams. Student B writes six pages: two on the direct impact, two on flow-ons, and two justifying a combination of three policies.
Compare and contrast the two reports against the criteria and give a reasoned judgement about which will achieve the higher grade, and what each should do differently.