ECONOMICS
Unit 3: Australia's Economic Prosperity
Area of Study 1: An introduction to microeconomics: the market system, resource allocation and government intervention
Outcome 1
- On completion of this unit the student should be able to explain how markets operate to allocate resources, and discuss the effect of government intervention on market outcomes.
Key knowledge
- reasons for market failure: public goods, externalities, asymmetric information and common access resources.
Key knowledge
- the effect of competitive markets on the efficiency of resource allocation
- reasons for market failure: public goods, externalities, asymmetric information and common access resources
- the role and effect of indirect taxation, subsidies, government regulations and government advertising as forms of government intervention in the market to address market failure.
Key skills
- define key economic concepts and terms and use them appropriately
- construct and interpret demand and supply diagrams
- explain the effect of government intervention in markets.