ECONOMICS
Unit 1: Markets and models
Topic 3: Market forces
- describe the different characteristics of goods and services, including private, public, merit, substitute and complementary.
Unit 2: Modified markets
Topic 1: Markets and efficiency
- describe key concepts using economic terminology, including allocative efficiency, externalities, market failure, goods (public, private, merit and demerit), and signals
- analyse the difference between complete market failure (missing markets) and partial market failure
- explain and analyse the causes and effects of market failure, including
- the difference between public goods (e.g. fresh air, national security, street lighting) and private goods, why markets might not adequately provide public goods and the concept of the free rider problem
- the ‘tragedy of the commons’ as it relates to common resources and the problem of ill-defined property rights, e.g. oceans and the atmosphere.