Exam-style question
Try this first
Central-bank decision on 3.1.1.1 Economic methodology: which option best explains the economic mechanism in Individuals, firms, markets and market failure?.
- A.Evaluate by considering short run, long run, stakeholder effects and magnitude before reaching an overall judgement.
- B.Government intervention always removes market failure with no trade-off.
- C.A tax shifts demand rather than affecting supply incentives and costs.
- D.Give a definition of labour markets only, without application, chain of analysis, evaluation or judgement.
Model answer
What a good answer should say
- Correct answer: Evaluate by considering short run, long run, stakeholder effects and magnitude before reaching an overall judgement..
- It is correct because it links 3.1.1.1 economic methodology to producer decisions and keeps the reasoning within the evidence supplied by the question.
Explanation
Why this works
The reasoning should move from cause to transmission mechanism to consequence. Use a diagram, calculation or data point if it is relevant, then test the answer with Economics evaluation: size of effect, time period, elasticity or responsiveness, assumptions, and distribution of gains and losses.
This keeps the response specific to Economic methodology and the economic problem rather than repeating a generic question template.
Common mistake
No common mistake is linked to this question yet.