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90356992

Economic

CARRIBBEAN EXAMINATIONS AUTHORITIES Caribbean Advanced Proficiency Examinations Correspondence relevant to the syllabus should be tackled to: The Pro-Registrar Carribbean Examinations Council Caenwood Hub 37 Arnold Road, Kingston 5, Discovery bay, jamaica, W. I. Telephone Number: (876) 920-6714 Copia Number: (876) 967-4972 Email address: [email, protected]

org Internet site: www. cxc. org Copyright laws © 08, by Caribbean Examinations Council The Garrison, St . Jordan BB 11158, Barbados This document CXC A20/U2/08 changes CXC A20/U2/03 issued in 2003. Take note that the syllabus was revised and amendments are indicated by italics and straight lines.

1st Issued 2003 Revised 2008 Please examine the website www. cxc. org for changes on CXC’s syllabuses. RATIONALE1 AIMS 2 SKILLS AND ABILITIES BEING ASSESSED2 PRE-REQUISITES OF THE SYLLABUS3 STRUCTURE OF THE SYLLABUS3 UNIT 1: MICROECONOMICS MODULE 1: METHODOLOGY: DEMAND AND SUPPLY 4 MODULE two: MARKET STRUCTURE, MARKET INABILITY AND INTERVENTION……, 12 COMPONENT 3: SYNDICATION THEORY 17 UNIT two: MACROECONOMICS COMPONENT 1: MODELS OF THE MACROECONOMY27 MODULE 2: MACROECONOMIC COMPLICATIONS AND POLICIES28 MODULE three or more: GROWTH, SUSTAINABLE DEVELOPMENT AND GLOBAL RELATIONS36 OUTLINE OF ASSESSMENT44

RESTRICTIONS FOR EXCLUSIVE CANDIDATES fifty five REGULATIONS TO GET RESIT CANDIDATES56 ASSESSMENT GRID57 RESOURCES58 GLOSSARY59 T Big t he Carribbean Advanced Proficiency Examinations (CAPE) are designed to offer certification in the academic, vocational and technological achievement of students inside the Caribbean who, having finished a minimum of five years of extra education, wish to further their very own studies. The examinations addresses the skills and knowledge bought by college students under a flexible and articulated system wherever subjects are organised in 1-Unit or 2-Unit training with each Unit that contain three Quests.

Subjects analyzed under GABARDINE may be researched concurrently or singly, or perhaps may be combined with subjects examined by other examination planks or organizations. The Caribbean Examinations Council offers three types of certification. Is the award of a certificate exhibiting each GABARDINE Unit completed. The second is the CAPE degree or diploma, awarded to candidates who have satisfactorily accomplished at least six Products, including Carribbean Studies. The next is the SHAWL Associate Degree, awarded to get the sufficient completion of a prescribed bunch of eight CAPE Units including Caribbean Studies and Communication Research.

For the CAPE degree and the GABARDINE Associate Degree, candidates must complete the cluster of required Models within a maximum period of five years. Identified educational institutions offering candidates intended for CAPE towards the award in the Council’s Affiliate Degree in nine types must, upon registering these types of candidates in the beginning of the qualifying year, make them confirm inside the required type, the Relate Degree they would like to be awarded. Candidates will not be awarded virtually any possible alternatives for which they were doing not apply. T? EXPLANATION

Economics is definitely the study showing how society offers itself by causing the most successful use of scarce resources in order that both non-public and cultural welfare could possibly be improved. This issue, therefore , protects the study of individuals, households, companies, government and international monetary institutions as they attempt to make better use of scarce resources. Study regarding Economics enables individuals to produce a better comprehension of the monetary issues which usually affect these people and the universe in which that they live. It will also enable students to offer educated comments upon economic concerns.

The knowledge received from this training course in Economics will be of lifelong worth to the college student. The influence of the subject on every area of activity should stimulate the individual to keep reading and conducting research in Economics. It is recognised that people doing this training course may be sucked from different backgrounds and could possess several interests. Some may wish to research Economics as preparation for additional specialisation in the subject. Other folks may study the subject to fit other subject matter disciplines, including, careers in finance, accounting or law.

Some learners may see the subject as one worthy of study in its own proper. Students of Economics will be able to contribute, significantly, to economic and social development in the Caribbean and the wider world simply by acting while catalysts for wider understanding of social and economic concerns. A study of Economics on the CAPE level will be of great benefit to all students by launching them to the philosophy which underlies every day economic relationships. The study will likely train students to think logically, critically and impartially on the variety of contentious issues. AIMS The syllabus aims to: 1 ) promote comprehension of the basic principles and ideas of economics which are approved in significant measure by simply economists although recognising the fact that field can be changing continually, 2 . develop an appreciation of the numerous methods used by economists in analysing monetary problems, 3. develop a comprehension of the global economy along with the human relationships between rich and poor nations regarding international operate and finance and the most important international finance institutions, 4. ncourage students to apply economic concepts, theories and tools to everyday economical problems, for instance , inflation, lack of employment, environmental destruction, sustainable expansion and exchange rate instability and to contribute meaningfully to the dialogue about these issues, five. encourage pupils to apply economical theory to the critical issues which impact the small open Caribbean-type overall economy, 6. motivate students to gauge contentious monetary issues so that decision-making can be informed simply by logical and critical considering, 7. sensitize students for the need for moral behaviour in the conduct of economic transactions. SKILLS AND ABILITIES TO BECOME ASSESSED The assessment will test candidates’ skills and abilities to: 1 . identify and clarify economic theories, principles, principles and strategies, 2 . interpret, analyse and solve monetary problems employing economic versions and ideas, 3. develop structural and reasoned expositions and assess economic hypotheses and procedures. PRE-REQUISITES WITH THE SYLLABUS Successful participation through this course of study will be enhanced by possession of very good verbal and written marketing communications skills. A good foundation in Mathematics would be an asset to students accomplishing this course.

COMPOSITION OF THE SYLLABUS The Syllabus is organized into two Units. Each Unit consists of three Modules, each Module requiring 50 contact several hours. UNIT one particular: MICROECONOMICS Module 1-Methodology: Require and Supply Module 2-Market Structure, Market Failure and Treatment Module 3-Distribution Theory PRODUCT 2: MACROECONOMICS Module 1-Models of the Macroeconomy Module 2-Macroeconomic Problems and Policies Component 3-Growth, Environmentally friendly Development and Global Relations Lists of resources are provided in the syllabus. The prospect lists provide data that may be ideal for the study of every Module.

It truly is advised which the topics classified by the parts do not actually follow sequentially. Teachers may well thus bring in certain principles before other folks. It is recognized that Economics may be taught using a totally qualitative strategy or a firmly quantitative way. However , an effective mix of both the approaches is critical to the understanding of the subject with this level. Instructors are encouraged, therefore , that proper delivery of the subject would entail the integration with the two techniques.? UNIT one particular: MICROECONOMICS COMPONENT 1: STRATEGY: DEMAND AND SUPPLY

GENERAL TARGETS On completion of this Component, students ought to: 1 . appreciate the main problem of economics specifically, the allowance of scarce resources and the inevitability of choice, 2 . be familiar with laws, principles and hypotheses governing demand and supply, a few. understand the standard tools of economic evaluation. SPECIFIC GOALS TOPIC you: Central Problem of Economics Students are able to: 1 . explain the concept of shortage, 2 . apply the concept of option cost in a number of real-life circumstances, 3. make clear the concept of creation possibilities frontier (PPF),. utilize production options frontier to point constant earnings, diminishing returns and increasing returns, your five. account for adjustments in the production choices frontier (PPF), 6. distinguish between great and normative economics, several. outline the advantages and disadvantages from the alternative components by which assets are allotted. CONTENT 1 . The meaning of scarcity, free of charge goods and economic products. 2 . (a)Definition of chance cost. b) Choice: what, how and then for whom to generate. UNIT you MODULE one particular: METHODOLOGY: REQUIRE AND SUPPLY (cont’d) ) The concept of opportunity expense applied to monetary agents (individuals, households, firms and governments). 3. (a)Assumptions: maximum outcome attainable, presented full work and frequent state of technology. (b)Regions: attainable, unattainable, efficient and inefficient numbers of production. four. Production possibilities frontier: mountains and styles. 5. Use of production opportunities frontier showing growth and technological transform. 6. Samples of positive and normative transactions. 7. Different types of economic devices: traditional, market, planned and mixed. PARTICULAR OBJECTIVES

SUBJECT 2: Theory of Client Demand Students should be able to: 1 ) explain the concept of utility, 2 . explain the law of reducing marginal energy and the restriction of minor utility theory, 3. clarify the meaning of indifference curves and finances lines, 4. explain client equilibrium using the marginal electricity approach, a few. explain customer equilibrium making use of the indifference curve approach, six. isolate the income and substitution associated with a price change, 7. clarify effective require, 8. derive the demand shape using the marginal utility and indifference curve methods, 9. ifferentiate among normal, inferior and Giffen goods, 10. separate shifts of the demand competition and movements along the shape, UNIT one particular MODULE you: METHODOLOGY: REQUIRE AND SUPPLY (cont’d) 11. determine the factors that impact demand, 12. explain this is of client surplus, 13. explain value elasticity, salary elasticity and cross firmness of require, 14. estimate numerical principles of firmness, 15. interpret numerical values of flexibility, 16. measure the implications of price firmness of demand for total spending and earnings, 17. condition the factors that identify the price firmness of require.

CONTENT 1 . Utility: total, marginal, capital (marginalist approach), ordinal (indifference curve approach). 2 . (a)Explanation of diminishing marginal power. (b)The primary assumptions and limitations of Marginal Electricity Theory. three or more. Indifference curves and the finances constraint (budget lines). four. The law of equi-marginal earnings. 5. The purpose of tangency of the spending budget line towards the indifference curve. 6. Salary and replacement effects of a cost change. several. Effective require. 8. Deriving the demand contour using the marginal utility as well as the indifference shape approach.. Usual, inferior and Giffen products using the not caring curve strategy. 10. Change versus movements along demand curves. 10. Price as well as the conditions of demand. 12. Consumer excessive including visual representations. PRODUCT 1 MODULE 1: METHOD: DEMAND AND SUPPLY (cont’d) 13. Price, cash flow, and cross elasticities. 18. Calculation of values of elasticity. 15. Classification and interpretations (sign and size), including the drawings and interpretations of graphs. 16. The implications of price elasticity of demand for total spending and revenue. 17.

Factors that decide the price firmness of demand. SPECIFIC TARGETS TOPIC a few: Theory of Supply Learners should be able to: 1 ) identify the factors of production, installment payments on your explain the term production function, 3. distinguish between the short run and long haul, 4. explain the law of diminishing comes back, 5. compute total, common and limited physical product, 6. clarify the human relationships among total, average and marginal physical product, six. identify the stages of production because they relate to total, average and marginal merchandise, 8. compute total, normal, marginal and other costs, 9. xplain the partnership among total, average and marginal costs, 10. clarify why source curves are generally positively sloped, 11. make clear the concept of developer surplus, 12. explain the design of the short run and long haul supply curves, UNIT 1 MODULE one particular: METHODOLOGY: DEMAND AND SUPPLY (cont’d) 13. explain returns to scale as well as the concepts of economies and diseconomies of scale, 16. distinguish between a movement over the supply curve and a shift in the supply contour, 15. make clear the concept of flexibility of supply, 16. determine elasticity of supply, seventeen. interpret suppleness of source. CONTENT. Elements of development: land, labour, capital and entrepreneurship. installment payments on your Relationship between output and input. 3. Fixed and variable elements. 4. The law of diminishing returns. five. Calculation of total common and marginal physical merchandise. (See advised teaching and learning activities). 6. Enhancements made on the relationship since input increases. 7. Development and its levels, as they relate to the total, typical and marginal product like the use of charts. 8. (a)Fixed cost, adjustable cost, total cost, marginal cost, typical fixed cost, average variable cost, average total expense, sunk costs. ) The shape of the long run average total cost competition. c) Fruitful optimum. being unfaithful. The relationship among total, average and minor cost such as the use of graphs. 10. Relationship between variety supplied and price. 14. Producer excessive including visual representations. PRODUCT 1 COMPONENT 1: STRATEGY: DEMAND AND SUPPLY (cont’d) 12. Relationship among marginal expense and the average cost inside the short run and long run. Description of so why the supply competition is the portion of the minor cost shape above the average variable cost and normal total cost. 13. (a)Long run and economies of scale. ) Factors determining economies of scale. c) Internal and external financial systems of range. d) Diseconomies of size. 14. Selling price and the circumstances of source. 15. Notion of elasticity of supply. of sixteen. Calculation of elasticity of supply. 18. Classification and interpretation (size of coefficient) including the drawing and meaning of charts. SPECIFIC TARGETS TOPIC four: Market Equilibrium Students should be able to: 1 . clarify the concept of industry, 2 . make clear market equilibrium, 3. estimate equilibrium value and volume, 4. describe factors that cause within equilibrium,. evaluate the impact of price settings on industry equilibrium, six. analyse the consequence of taxation and subsidies on market equilibrium. UNIT 1 MODULE you: METHODOLOGY: REQUIRE AND SUPPLY (cont’d) CONTENT 1 . The concept of the market. 2 . Sense of balance price, equilibrium quantity. a few. Use of demand and supply info to determine equilibrium price and amount. 4. Within conditions of supply and demand. a few. The effects of price ceilings and price floor surfaces on sense of balance. 6. (a)The effects of taxation and subsidies on market equilibrium. (b)The incidence of the indirect duty.

Suggested Teaching and Learning Activities To facilitate students’ attainment of the objectives with this Module, professors are advised to employ students in the teaching and learning actions listed below. 1 . For topic 1, Central Problem of Economics, allow students offer examples by personal life, the home, businesses and authorities to demonstrate chance cost as well as the production opportunities frontier (PPF). 2 . To get topic a couple of, Theory of Consumer Require, let college students derive their own schedule and plot the need curve pertaining to commodities that they can use in all their everyday lives. 3.

Pertaining to utility, employ water or any other drink to show different levels of fulfillment (utility). Utilize the data to derive total and little utility figure. 4. For the concept of flexibility, teachers could use two types of materials, one which could enhancements made on varying degrees and the different which remains to be the same no matter circumstances. Professors should then simply apply this concept to market circumstances illustrating the concepts of elasticity and inelasticity. your five. For deadweight loss, teachers may use the graphs for consumer and producer extra to show just how market treatment may lead to loss welfare (deadweight loss). six.

For levels of creation, allow students to derive the total average and minor product curves using lab-created data. Make use of the results with the graphs to point out the different levels of development. An example is given below. PRODUCT 1 COMPONENT 1: METHODOLOGY: DEMAND AND PROVIDE (cont’d) CHART SHOWING THE STAGES OF PRODUCTION [pic] (i)Stage 1occurs up to the point wherever APPL is in its optimum. (ii)Stage 2 occurs from the stage where APPL is in a maximum up to the point wherever MPPL can be zero. With this stage fresh workers increase total physical output. (iii)Stage 3 happens when MPPL is unfavorable. The producer will run in stage 2 .

In stage 1 there is inadequate labour being used (up until MPPL reaches its maximum) and the outcome per member of staff is raising. In stage 3 the producer gets no conjunction with total physical output via additional employees. It would be possible to have more total physical product with less time applied to a fixed factor (say machinery). UNIT 1 COMPONENT 2: INDUSTRY STRUCTURE, MARKETPLACE FAILURE AND INTERVENTION STANDARD OBJECTIVES In completion of this Module, pupils should: 1 ) appreciate the distinction between the various kinds of market set ups, 2 . develop awareness of the causes of market inability,. appreciate the procedures that can be implemented to reduce or perhaps eliminate industry failure, some. appreciate the quarrels which claim that government intervention may not actually improve financial performance. SPECIFIC OBJECTIVES SUBJECT 1: Market Structure College students should be able to: 1 . outline the goals from the firm, installment payments on your explain how firms assess profits, several. explain the concepts of average, marginal and total revenue, some. explain the concept of market structure, 5. summarize the characteristics from the different industry structures, six. distinguish among the list of different market structures, several. xplain the factors that influence the pricing and output decisions of the firm, 8. estimate measures of industrial concentration, 9. interpret actions of industrial concentration. UNIT you MODULE two: MARKET STRUCTURE, MARKET INABILITY AND INPUT (cont’d) ARTICLES 1 . Income maximization, development, satisficing, sales and income maximization, market dominance. 2 . Total earnings, total expense, normal and economic (abnormal) profit. three or more. Relationship among average, marginal and total revenue. 4. Types of market buildings: perfect competition, monopoly including price splendour, monopolistic competition, oligopoly and cartels.. Characteristics of the distinct market buildings. a) boundaries to entrance, b) control over market and price, c) nature from the good, d) numbers of buyers and sellers, e) competitive behaviour and gratification. 6. Concentrate on all qualities of the different markets furthermore to income maximization. a) Examples of close approximations of market buildings in the Caribbean. 7. Marginal cost and marginal revenue, total cost and total revenue, limited cost pricing and average cost charges. 8. Herfindahl Hirschman Index , the percentage of an industry’s output created by its several largest companies (four-firm focus ratio): pic] wherever si is the market share of firm we in the market, and n is a number of businesses. 9. (a)Interpretation related to marketplace structures. b) Limitations of measures of industrial concentration. DEVICE 1 MODULE 2: MARKETPLACE STRUCTURE, MARKET FAILURE AND INTERVENTION (cont’d) SPECIFIC TARGETS TOPIC 2: Market Failing Students are able to: 1 . explain the concept of financial efficiency, 2 . distinguish amongst private products, public merchandise and merit goods, three or more. distinguish between sociable costs and costs and social rewards and private rewards, 4. clarify the concept of industry failure, 5. explain what is meant by simply deadweight damage,. outline what causes market failing. CONTENT 1 . Inclusion of discussion of Pareto efficiency. installment payments on your (a)Examples of private goods, open public goods and merit goods. (b)Discussion of issues of rivalry and exclusion. three or more. Social costs, private costs, social benefits, private rewards, external costs, external benefits. Use of graphical representations. four. Divergence of social costs and interpersonal benefits and efficiency. Make use of graphical illustrations. 5. Deadweight loss which include verbal and graphical illustrations. 6. Reasons behind market failure: a) monopoly, b) open public goods and merit merchandise, c) externalities: positive and negative

PRODUCT 1 MODULE 2: INDUSTRY STRUCTURE, INDUSTRY FAILURE AND INTERVENTION (cont’d) d) divergence between interpersonal and private costs and sociable and private rewards, e) not perfect information, f) asymmetric data: adverse assortment and moral hazard, g) open entry to resources, h) lack of property rights (squatting, streams, ocean), i) non-existence of marketplaces (for trading). SPECIFIC GOALS TOPIC a few: Intervention Students should be able to: 1 ) evaluate the measures used by govt to correct industry failure, installment payments on your evaluate the steps used by the private sector to correct marketplace failure. CONTENT 1 .

Actions used by authorities to control marketplace failure: a) -regulation, , anti-trust plan, , taxation, , privatisation and deregulation, , express ownership, , subsidies, , legislation, , market creation (tradable permits), b) advantages and disadvantages of government intervention, c) -merits and demerits, , success of input in Carribbean societies (effect of small size in relation to policy making). UNIT you MODULE two: MARKET COMPOSITION, MARKET FAILURE AND INVOLVEMENT (cont’d) installment payments on your Private Sector Intervention: (a)corporate code of conduct, (b)corporate social responsibility, (c)voluntary deals, (d)corporate values.

Suggested Instructing and Learning Activities To facilitate students’ attainment with the objectives on this Module, professors are advised to participate students in the teaching and learning activities listed below. 1 ) For price discrimination, professors could determine the first, second and third degree price elegance using different examples coming from students’ experience. Teachers should then demonstrate by use of diagrams. 2 . For the kinked demand curve model, teachers could use the daily newspaper or perhaps mobile phone market as illustrations. UNIT you MODULE 3: DISTRIBUTION THEORY GENERAL OBJECTIVES On completion of this Module, students ought to:. understand what makes up the earnings that amass to the owners of the factors of creation, 2 . appreciate the issues encircling poverty plus the measures utilized to alleviate poverty, 3. develop skills in applying microeconomic analysis to critical cultural issues involving income inequality. SPECIFIC GOALS TOPIC 1: The Demand to get and Supply of things Student are able to: 1 . clarify the advantages of the factors of production, 2 . explain the concept of derived demand, a few. outline the marginal efficiency theory, four. apply the marginal output theory towards the demand for land, capital and labour, 5. nalyse the factors influencing the supply of land, capital and time, 6. evaluate the factors determining lease, interest and wages, several. distinguish between copy earnings and economic rent. CONTENT 1 ) Rent, fascination, wages and profits. installment payments on your Derived require. 3. (a)The assumptions and limitations of Marginal Productivity Theory. (b)Marginal Physical Product, Marginal Earnings Product and the relationship. DEVICE 1 COMPONENT 3: CIRCULATION THEORY (cont’d) 4. The cost of the Limited Product: a) land, b) labour, c) capital , using present value (use of visual representation required). 5.

The fixity of land, the supply of loanable funds as well as the labour source. 6. The necessity for and provide of factors. several. Numerical, visual and mental explanations of transfer revenue and economic rent. SPECIFIC OBJECTIVES SUBJECT 2: Salary Differentials Pupil should be able to: 1 ) explain the concept of wage differentials, 2 . examine imperfections in the labour industry, 3. examine the effect of labour mobility on wages, 4. clarify the concept of compensating wage differentials, 5. clarify the part of Government, Trade Unions and Employers’ Groups in the charges of labour. CONTENT 1 .

Differences in wages within sectors and amongst industries. installment payments on your Imperfections on the demand part (for case, differences in marginal productivity) and the supply aspect (for case in point, geographical immobility). 3. The mobility and immobility of labour, physical (migration of workers), occupational. 4. Compensating (equalizing) differentials. UNIT one particular MODULE several: DISTRIBUTION THEORY (cont’d) a few. The minimal wage rate, monopsonies, immigration of employees, collective negotiating, trade union strategies, the role of employers’ interactions, efficiency income. SPECIFIC TARGETS TOPIC a few: Income inequality, Poverty and Poverty Alleviation

Students should be able to: 1 . separate between size and efficient distribution of income, installment payments on your explain the idea of income inequality, 3. describe the actions of salary inequality, 5. explain the measures utilized to reduce profits inequality, your five. distinguish between complete and family member poverty, six. outline elements that lead to poverty, six. explain why certain categories of people are even more susceptible to lower income than other folks, 8. assess the different ways used to measure low income, 9. describe strategies utilized by Governments to alleviate poverty, 15. analyse the economic costs of low income, 1 . assess the economic great things about government treatment to alleviate poverty. CONTENT 1 . Size and functional circulation of cash flow. 2 . How income can be distributed. 3. Lorenz curve measurement of income inequality, and Gini coefficient (interpretation only). 5. Measures to lessen inequality: fees, subsidies, transfers. UNIT 1 MODULE 3: DISTRIBUTION THEORY (cont’d) your five. Absolute vs . relative low income. 6. Factors that play a role in poverty including: a) social and physical environment, b) discrimination – gender, competition, c) restrictions on specific economic activities, d) non-ownership of resources, ) family size, f) single parent, female- advancing families. 7. Persons who have are the majority of susceptible to lower income: (a)people with special requirements, i) actually challenged, ii) elderly, iii) youth, iv) single father or mother families, v) indigenous persons, (b)reasons – Limited use of employment, degree of training, legal guidelines, availability of salary to share amongst family. almost eight. Ways accustomed to measure poverty: a) standard needs, b) poverty line, c) head count, d) UNDP Individual Development Index (HDI). UNIT 1 MODULE 3: DIVISION THEORY (cont’d) 9. Strategies to alleviate low income: a) copy payments, b) free education and healthcare, ) casing, d) bare minimum wage legal guidelines, e) equal employment opportunities, f) Government job creation(special works programmes). 12. The cost of lower income, including: a) unemployed human resources, b) reduce potential outcome, c) ineffective allocation of Government expenditure, d) social and environmental costs. 11. Financial benefits which includes: a) dotacion of education and wellness leading to progress human capital, b) improvement in well- being because measured by the UNDP (HDI), c) more equitable distribution of income. Suggested Instructing and Learning Activities

To facilitate students’ attainment in the objectives of the Module, educators are advised to participate students inside the teaching and learning actions listed below. 1 . Use know-how from topic 3, device 1, Theory of Source, to derive the demand curve for factors of development. 2 . Instructors may use graphic representation in the Lorenz Competition to demonstrate unequal circulation of profits. Teachers also needs to relate the Lorenz Contour to the GINI coefficient. As well show the a result of taxes on the Lorenz Contour and the GINI coefficient. UNIT 2: MACROECONOMICS MODULE 1: MODELS OF THE MACROECONOMY

GENERAL OBJECTIVES About completion of this kind of Module, students should: appreciate the notion of National Profits accounting plus the importance of these kinds of accounts for macroeconomic theory and policy, 1 . understand the landscapes of the classical keynesian and monetarists schools, 2 . be familiar with factors that influence the amount of investment in an economy. PARTICULAR OBJECTIVES TOPIC 1: National Income Accounting Students must be able to: 1 . clarify the circular flow of income, 2 . explain the concept of National Income Accounting, three or more. explain the various ways of deriving National Profits Accounts, four. nterpret Nationwide Income statistics, 5. employ National Profits accounts to assess the performance on an economic system as a whole, 6. derive real GDP coming from nominal GDP, 7. describe the limitations of GDP. CONTENT MATERIAL 1 . Financial agents. installment payments on your Gross Domestic Product (GDP), Gross Nationwide Product (GNP) and other procedures. 3. Calculations of GDP, GNP and their components (personal income, non reusable income), Net National Cash flow (NNI), and per capita income, elimination of twice counting. UNIT 2 MODULE 1: TYPES OF THE MACROECONOMY (cont’d) 5. Total measures: a) GROSS DOMESTIC PRODUCT at market prices, b) GDP by factor costs. 5.

Usage of National income accounts to measure financial performance after some time and to make inter-country comparisons. six. Calculation of real and nominal GDP using the value deflator. six. Limits of National Profits Accounts as being a measure of health and wellness: a) non-inclusion of the simple sector (the underground economy, illegal activities), b) non-payment for do-it-yourself activities, c) non-accounting pertaining to externalities, environmental degradation (Green GDP), d) the fact it measures changes in the value of output although not changes in the standard of living. SPECIFIC OBJECTIVES TOPIC two: Classical models of the Macroeconomy

Students are able to: 1 . describe why in the classical version, all career is non-reflex, 2 . clarify how complete employment can be restored in the classical unit, 3. describe the factors that effect aggregate demand, 4. explain the elements that effect aggregate source, 5. understand the time-honored long run supply curve, 6. explain selling price level determination within the time-honored model, several. use the traditional aggregate require and supply unit to show changes in the price level and job. UNIT a couple of MODULE 1: MODELS OF THE MACROECONOMY (cont’d) CONTENT 1 . Flexibility of wages and costs. 2 .

The role of wage cost and interest rate flexibility. three or more. The elements that effect aggregate demand: a) consumer spending, b) investment spending, c) Government spending, d) net export spending. 4. Factors that influence combination supply including changes in input prices and incomes. a few. The presumptions of the up and down aggregate source curve. 6th. The discussion of the time-honored aggregate demand and supply curves. 7. Alterations in the get worse demand and aggregate supply curves. CERTAIN OBJECTIVES SUBJECT 3: Standard Keynesian Models Students will be able to: 1 . clarify the usage function, installment payments on your xplain the relationship between saving and consumption, 3. calculate the simple multiplier, 4. describe the effect of changes in investment on nationwide income, 5. explain the effect of government investing in national salary, 6. illustrate the effect of withdrawals and injections on national salary, UNIT 2 MODULE 1: MODELS OF THE MACROECONOMY (cont’d) 7. make clear the relationship between net exports and national income, eight. determine the equilibrium amount of national profits, 9. clarify inflationary and deflationary breaks. CONTENT 1 . Autonomous and induced usage. 2 . (a)Income = intake plus saving. b)marginal tendency to consume and save. (c)average propensity in order to and conserve. 3. Simple multiplier [pic]. four. Relationship among changes in assets and countrywide income. five. Government’s spending and its results on nationwide income. 6. (a)Concepts of injections and withdrawals within an economy. (b)The effect of shots and withdrawals on national income. (c)Small multipliers in the Caribbean framework due to leaking. 7. (a)Relationship between net exports (x – m) and national income. b) Exports because an injection and imports being a withdrawal. almost 8. Determination of equilibrium profits using: a) 45 o line or perhaps E=Y, ) withdrawals and injections procedure, c) the Keynesian get worse demand and supply curves (long run and short run). UNIT two MODULE 1: MODELS OF THE MACROECONOMY (cont’d) 9. (a)Full employment amount of output. (b)Actual level of outcome. (c)Equilibrium degree of national cash flow could be either below, by or over potential standard of output. SPECIFIC OBJECTIVES MATTER 4: Purchase Students must be able to: 1 . describe the concept of expense, 2 . identify between the purchase demand shape and the investment curve, several. explain the accelerator theory, 4. outlinethe factors that account for the volatility of investment.

CONTENT MATERIAL 1 . Expenditure (induced and autonomous). 2 . (a)Marginal effectiveness of capital (investment demand as a function of expected rate of return). b) Marginal performance of investment ( noninterest rates while determinants of investment require, taxes, costs, stock of capital goods on hand expectations). 3. Fender theory of investment. some. Determinants of investment: a) The accelerator, b) Durability, c) Anomaly of development, d) Variability of earnings, expectations and interest rates. UNIT 2 MODULE 1: MODELS OF THE MACROECONOMY (cont’d) Recommended Teaching and Learning Activities

To assist in students’ attainment of the goals of this Component, teachers are advised to engage students in the instructing and learning activities the following. 1 . For topic one particular, teachers ought to pay special attention to the rules of accounting working from the GDP to consumption and savings. Instructors should also manage the principles such as market price and aspect costs, and also real GROSS DOMESTIC PRODUCT and typical GDP. Makes use of the circular stream diagram in the closed economic system to the open economy. 2 . For theme 2, Time-honored Models of the Macroeconomy, instructors should use graphs to emphasise flexibility plus the automatic come back to equilibrium.. Pertaining to topic several, teachers could demonstrate the operation in the multiplier by making use of data to demonstrate the effective rounds of spending. Computations and graphical representations with the multiplier are required. 4. Use the 45° range and typical demand and average source to show inflationary and inflationary gaps. five. For subject 4, Purchase, teachers could use tables to illustrate and explain the accelerator, that is certainly, the necessity to increase expenditure, constantly, for investment. UNIT two MODULE 2: MACROECONOMIC CHALLENGES AND GUIDELINES GENERAL AIMS On completion of this Module, students will need to: nderstand why an economic climate may be characterised by unemployment and how involvement may be used to increase economic overall performance, appreciate the position of the Central Bank in the economy, understand financial and fiscal policy and their applications, understand the nature and burden of the national debt. CERTAIN OBJECTIVES MATTER 1: Unemployment and Inflation Students must be able to: 1 . make clear what is meant by the labour force, 2 . explain the unemployment level, 3. distinguish between unemployment and underemployment, 5. evaluate the costs of unemployment, 5. explain the causes of lack of employment, 6. valuate the procedures used to reduce unemployment, six. explain the causes of inflation, eight. distinguish between real and nominal variables, on the lookout for. explain just how inflation is usually measured, 10. explain the causes of inflation, 10. evaluate the associated with inflation, UNIT 2 MODULE 2: MACROECONOMIC PROBLEMS AND POLICIES (cont’d) 12. measure the policies accustomed to combat pumpiing, 13. describe the relationship between the unemployment rate and inflation. CONTENT 1 ) Employed and unemployed. 2 . The lack of employment rate. several. Unemployment and underemployment. 4. The effect about output, salary and development: additional economical burden for the state, sociable costs.. Labour immobility, additional market imperfections, structural changes in the economy, not enough aggregate demand, increase in labour force engagement rate, seasonality, intervention. six. Fiscal policy, monetary insurance plan, wage financial assistance, retraining programs, investment duty credit, career tax credit rating, government employment programmes, lowering market defects. 7. Pumpiing: general cost level. 8. Real and money wages: a) actual and nominal GDP, b) real and nominal interest. 9. The GDP deflator, the selling price index, the producer price index. Calculations and limitations of the indices. twelve.

Demand shock absorbers, supply shocks, increase in the cash supply development rate. 10. The costs and benefits of pumpiing: the impact of redistribution of wealth, effects of organization activity and growth, impact on the balance of payments. 12. Income coverage, monetary policy, fiscal policy and supply side measures. 13. Trade-off among inflation as well as the rate of unemployment: Phillips curve – stagflation. UNIT 2 COMPONENT 2: MACROECONOMIC PROBLEMS AND POLICIES (cont’d) SPECIFIC OBJECTIVES TOPIC 2: Monetary Theory and Insurance plan Students will be able to: 1 . make clear the concept of money, 2 . describe the capabilities of money, 3. explain the necessity for money,. describe the supply of money, 5. explain monetary plan, 6. make clear how the money supply is definitely controlled, several. explain just how money is established in the bank system, almost eight. explain so why residents substitute foreign for domestic foreign currency, 9. describe the Quantity Theory of Money, 15. outline the types of monetary policy, 11. describe the effects of financial policy about national profits, 12. evaluate the limitations of monetary plan. CONTENT 1 . (a)The which means of money. (b)Types of money: symbol and product. 2 . Capabilities of money. three or more. (a)Liquidity Preference Theory. (b)Motives for possessing money (transactions, precautionary, speculative). UNIT a couple of

MODULE a couple of: MACROECONOMIC COMPLICATIONS AND GUIDELINES (cont’d) four. The money supply (M1, M2). 5. Economic policy – expansionary and contractionary procedures. 6. (a)The role in the central bank in creating high-powered funds (monetary base). (b)Instruments of monetary control: i) wide open market procedures, ii) discount rates, iii) auto financing fiscal failures, iv) hold requirements, v) moral suasion, vi) rates of interest. 7. (a)Excess reserves. (b)Credit creation. (c)The money multiplier. 8. The size of currency alternative and hoarding. 9. The amount Theory involving. 10. (a)Tight monetary insurance plan (inflation). (b)Easy monetary coverage (unemployment). c)Balance of obligations. 11. Just how monetary policy affects countrywide income. 12. Limitations of monetary policy including the reality it is: a) permissive, not really compelling and later creates the surroundings, UNIT 2 MODULE two: MACROECONOMIC PROBLEMS AND GUIDELINES (cont’d) b) difficult to control the money supply of foreign-owned business banks, c) difficult to get rid of lags in monetary coverage, d) fragile by fiscal indiscipline. CERTAIN OBJECTIVES MATTER 3: Monetary Policy Students should be able to: 1 . explain the idea of fiscal coverage, 2 . outline the desired goals of fiscal policy, several. explain the size of the budget, some. xplain the balanced finances multiplier, five. outline ways of financing finances deficits, 6. evaluate the limits of money policy, 7. distinguish between discretionary and nondiscretionary fiscal insurance plan. CONTENT 1 ) The meaning of fiscal policy. 2 . Financial policy as a method of dealing with: a) get worse demand, b) unemployment, c) inflation, d) balance of payments. UNIT 2 COMPONENT 2: MACROECONOMIC PROBLEMS AND POLICIES (cont’d) 3. The size of the budget: a) taxation, earnings, transfer, costs, b) finances surplus and budget shortage, c) balanced budget. 4. Explanation of the balanced budget multiplier. your five.

Methods of financing budget deficits including external and domestic borrowing. 6th. Lags and potency of fiscal plan. 7. (a)Expansionary and contractionary. (b)Automatic stabilizers. Specific targets TOPIC 4: Public Personal debt Students are able to: 1 . make clear the countrywide debt, installment payments on your explain the main cause of the nationwide debt, several. evaluate the associated with the nationwide debt around the economy, 4. explain the duty of the nationwide debt, five. evaluate techniques for reducing your debt burden, 6. interpret your debt service ratio, 7. determine the debt support ratio. UNIT 2 COMPONENT 2: MACROECONOMIC PROBLEMS AND POLICIES (cont’d) CONTENT 1 ) The national debt: ) stock/flow, b) fiscal indiscipline, c) domestic and overseas debt. installment payments on your The causes of the national debt. 3. The effects of the countrywide debt around the economy: a) output and investment decisions, b) exchange rate pressures, c) pumpiing, d) crowding out and crowding in. 4. The responsibility for financial debt repayment. 1 ) Management from the national personal debt: a) internal and external borrowing, b) taxation, c) debt rescheduling, d) financial debt forgiveness. installment payments on your Interpretation in the debt service ratio. several. Calculation with the debt assistance ratio (principal plus fascination as a percentage of export). UNIT a couple of MODULE 2: MACROECONOMIC CHALLENGES AND POLICIES (cont’d)

Advised Teaching and Learning Actions To assist in students’ achievement of the goals of this Module, teachers should engage college students in the instructing and learning activities the following. 1 . To get topic one particular, Unemployment and Inflation, instructors should utilize the Phillips Curve to show the relationship between the lack of employment rate and inflation level. 2 . Pertaining to topic 2 (money multiplier), show the different rounds in the money development process because done in the multiplier. Make use of Central Bank Acts and Reports to get data gathering. 3. Intended for fiscal policy, there is no need for individuals to obtain the well-balanced budget multiplier.

This should be explained. 4. Teachers should emphasize the causes of the national debt as well as the burden that places in future ages. UNIT 2 MODULE three or more: GROWTH, ECO FRIENDLY DEVELOPMENT AND GLOBAL RELATIONSHIPS GENERAL TARGETS On completing this Component, students should: 1 . be familiar with basic ideas of growth and development, 2 . understand the impact of imports and exports around the macroeconomy, several. understand the balance of payments accounts and appreciate the causes and implications of harmony of payments crises, 5. become aware of the rewards and costs derived from current integration arrangements, such as CARICOM, FTAA plus the EU,. understand the role and functions of international financial institutions. SPECIFIC OBJECTIVES SUBJECT 1: Expansion and Lasting Development College students should be able to: 1 . distinguish between growth and development, 2 . describe the concept of lasting development, a few. outline the factors that determine progress, 4. format the elements that bring about sustainable development, 5. make clear the concept of human being development, 6th. anaylse the structural attributes of Caribbean economies, six. analyse the effect of the region’s structural characteristics on eco friendly economic expansion. UNIT 2

MODULE a few: GROWTH, ENVIRONMENTALLY FRIENDLY DEVELOPMENT AND GLOBAL CONTACT (cont’d) CONTENT 1 . Distinctions between development and growth. 2 . Current growth compared to well-being of future ages. 3. Variations between exogenous (technical change) and endogenous growth (capital accumulation, human being capital). four. Economic, interpersonal and environmental factors. 5. Indices of human development including mortality rates, literacy, per capita income, life span. 6. Structural characteristics of Caribbean economies including: a) small size, b) openness, c) make up of export products, d) reference base, e) poverty, f) economic dependence.. Implications pertaining to regional economies: a) reliance on aid, b) preferential control agreements, c) foreign direct investment (FDI), d) weakness to all-natural and man-made change, e) changes in universe prices. PRODUCT 2 MODULE 3: GROWTH, SUSTAINABLE ADVANCEMENT AND GLOBAL RELATIONS (cont’d) SPECIFIC OBJECTIVES TOPIC 2: International Operate Students should be able to: 1 . evaluate the part of imports and exports in a small open up economy, 2 . outline the factors that influence exports and imports, 3. explain the effects of forex trading earnings over a small open up economy, some. explain the theory of relative advantage, five. valuate the arguments pertaining to protection, six. evaluate the arguments for Trade Liberalisation, six. outline ways of trade safety, 8. describe the commodity, terms of trade, being unfaithful. interpret changes in the commodity terms of transact, 10. compute the product, terms. CONTENT 1 . The role of exports in creating home income as well as the role of imports in generating profits for foreigners. 2 . The factors which will determine export products and imports including: a) international price, b) household production, c) domestic prices and exchange rates, d) international monetary activity since it affects the tourism marketplace in the Carribbean, UNIT a couple of

MODULE a few: GROWTH, LASTING DEVELOPMENT AND GLOBAL ASSOCIATIONS (cont’d) e) shifts in international demand and the emergence of alternatives, f) changes in International Income. 3. Foreign currency earnings coming from exports: a) access to capital goods, b) the foreign trade multiplier, c) access to customer goods, d) increased household production. 5. The theory of comparative benefit. 5. Quarrels for security including: a) infant industries, b) career, c) foodstuff security. 6th. Arguments intended for Trade Liberalisation including access to technology, accessibility to cheaper goods and services. Application of the theory of comparison advantage.. Methods of protection which include: tariffs, quotas and other nontariff methods. 8. Explanation from the commodity conditions of trade. 9. Interpretation of modifications in our commodity terms of transact. 10. Foreign trade price index divided simply by import cost index increased by 75. UNIT 2 MODULE several: GROWTH, SUSTAINABLE DEVELOPMENT AND GLOBAL CONTACT (cont’d) CERTAIN OBJECTIVES SUBJECT 3: Stability of Payments and Exchange Rates Students should be able to: 1 ) explain the total amount of obligations, 2 . separate the current bank account and capital account, several. analyze the complexities and implications of stability of payments disequilibria, 4. utline the policy procedures for fixing balance of payments disequilibria, 5. explain exchange prices, 6. describe exchange rates determination, six. distinguish between fixed and flying exchange level regimes, eight. describe the consequences of the exchange rate improvements. CONTENT 1 ) Explanation of the balance of payments. installment payments on your Capital products and current items. 3. The causes and consequences of balance of payments , disequilibria. 5. Policy responses to stability of payments crises including: a) accounting allowance, b) expenditure switching, c) expenditure minimizing measures. your five. Explanation of exchange rates. 6.

Determination of exchange rates. UNIT 2 COMPONENT 3: EXPANSION, SUSTAINABLE DEVELOPMENT AND GLOBAL RELATIONS (cont’d) 7. Fixed and suspended exchange charge systems (fixed, free suspended and been able float). 8. The effects of exchange rate changes. SPECIFIC GOALS TOPIC four: Economic The usage Students are able to: 1 . explain the main varieties of economic incorporation, 2 . evaluate the costs and benefits of financial integration, several. evaluate the objectives of Carribbean integration, some. analyse the implications of international incorporation arrangements for Caribbean economies. CONTENT 1 . Main types of economic the use, including: ) free trade area, b) customs union, c) prevalent market, d) economic union. 2 . The expenses and great things about economic integration including operate creation and trade diversion. 3. The objectives of CARICOM as well as the rationale intended for the CARICOM Single Industry and Overall economy (CSME). four. The significance of integration movements, for example Eu (EU) and the North American Totally free Trade Contract (NAFTA) pertaining to Caribbean Financial systems. UNIT two MODULE 3: GROWTH, LASTING DEVELOPMENT AND GLOBAL ASSOCIATIONS (cont’d) SPECIFIC OBJECTIVES TOPIC 5: Intercontinental Economic Relations Students should be able to: 1 . xplain the role and capabilities of the World Transact Organisation (WTO), 2 . describe the part of intercontinental financial institutions (IFI’s), 3. make clear the term multinational (transnational) firm, 4. explain the nature of overseas direct expenditure, 5. summarize the potential rewards and disadvantages of foreign direct investment, 6th. explain the definition of globalisation, six. describe the factors in charge of globalisation, almost 8. evaluate the associated with globalisation upon developing countries. CONTENT 1 ) The function and functions of the WTO. 2 . The role of the IMF and World Traditional bank in the Worldwide Financial System.. Explanation of international (transnational) organization. 4. The nature of foreign immediate investment. a few. Potential rewards and disadvantages, which include: a) entry to technology and capital, b) access to markets, c) usage of management expertise, d) repatriation of income, UNIT a couple of MODULE 3: GROWTH, LASTING DEVELOPMENT AND GLOBAL ASSOCIATIONS (cont’d) e) transfer pricing, f) crowding out of domestic businesses. 6. The concept of globalisation. six. Forces generating globalisation, for example , technological innovation, trade liberalisation, and liberalisation of capital markets. 8.

Implications of globalisation for expanding countries with particular reference to the greater Carribbean (greater competition, access to marketplaces, access to technology, cheaper prices and better variety of items, loss of preferential markets). Recommended Teaching and Learning Activities To help students’ achievement of the targets of this Component, teachers should try to engage pupils in reviewing the framework of the financial systems of the Carribbean and the challenges of imports and export products using foreign partnership contracts and plans. Teacher should ensure that students could differentiate among, ) Terms of Trade, b) Balance of Trade, and c) Stability of Repayments.? OUTLINE OF ASSESSMENT Each Unit with the syllabus will probably be assessed individually. The same structure of assessment will be put on each Module in every Unit. Grades will be awarded independently for each Unit. Candidate assessment to each Unit is going to comprise two components: i) External Examination undertaken at the end of the academics year when the Unit is usually taken. This kind of component contributes 80% towards the candidate’s total grade. ii) Internal Assessment undertaken through the course of the system. This leads to 20% towards the candidate’s total grade. EXTERIOR ASSESSMENT | (80%) | |Paper 01 |Forty-five multiple-choice items, fifteen (15) on each Module. |30% | | |(1 hour 30 minutes) | | | | |Paper 02 |The paper consists of 3 (3) portions comprising 6 (6) questions spread across |50% | | |(2 hours 31 minutes) |all Modules inside the Unit.

Every section includes two (2) essay type questions via which| | | | |candidates have to attempt 1 (1). | | | | | | |INTERNAL ASSESSMENT FOR EACH UNIT | | |

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Category: Essay cases,

Topic: Installment payments, Installment payments your, Make clear, Payments your,

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Published: 04.16.20

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