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Page 1

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Edexcel Economics AS Unit 1: Competitive Markets ­ How they work and Why they Fail Revision notes



Edexcel Economics AS Level
Unit 1: Competitive
Markets ­ How They work &
Why They Fail Revision notes













Olivia Boertje

Page 2

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Edexcel Economics AS Unit 1: Competitive Markets ­ How they work and Why they Fail Revision notes

1.3.1 What is the nature of economics?

Scarcity ­ the basic economic problem that there are infinite
wants but limited resources

Limits the amount that can be produced however the amount
of goods…

Page 3

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Edexcel Economics AS Unit 1: Competitive Markets ­ How they work and Why they Fail Revision notes

Along the PPF Society can move along the PPF. Consumer goods = Capital goods
For the frontier to be straight the two goods have to have a prefect trade off. They do not…

Page 4

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Edexcel Economics AS Unit 1: Competitive Markets ­ How they work and Why they Fail Revision notes

2. Resources unused
3. Inefficient use of resources or services

Inward shift ­ The PPF can shift inwards to indicate a decrease in productive capacity.

1. Decrease in resources =
i) fall in…

Page 5

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Edexcel Economics AS Unit 1: Competitive Markets ­ How they work and Why they Fail Revision notes

sector is greater while in North America (U.S.A and Canada) it is lower. North Korea is a centrally
planned economy



Free market Economy

Advantages Disadvantages
Economic efficiency: Income & Wealth distribution uneven =…

Page 6

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Edexcel Economics AS Unit 1: Competitive Markets ­ How they work and Why they Fail Revision notes

materials or minerals used in the production of goods and services e.g. wheat, sugar, gold and oil
iii) A labour market refers to the buying and selling of labour time for the production…

Page 7

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Edexcel Economics AS Unit 1: Competitive Markets ­ How they work and Why they Fail Revision notes





Price, Income and Cross Elasticities of Demand (PED, YED and XED)

Pric
e
Elas
ticit
y of
De
man
d >
P ED =
Demand Value of Example of a What effect Change…

Page 8

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Edexcel Economics AS Unit 1: Competitive Markets ­ How they work and Why they Fail Revision notes

change in
price.
%Qd < %P
Perfe PED= 0 No The
ctly substitutes percentage
Inelas change in
tic quantity is
not affected
by the
change in
price.


Determinants of PED:

1. Availability of…

Page 9

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Edexcel Economics AS Unit 1: Competitive Markets ­ How they work and Why they Fail Revision notes


Demand >
%Qdb
X ED = %P a
Exampl show P good a Qd good b
Value of e (in example example
XED words)
Substitute goods In
P a = Qdb
XED= +ve…

Page 10

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Edexcel Economics AS Unit 1: Competitive Markets ­ How they work and Why they Fail Revision notes



















1.3.3 What determines the Supply of a good or service in a market?

Supply refers to the quantity of goods or services that firms are willing to sell over a given period of…

Comments

Natalie

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Hey these notes are really good thanks so much. But did you recently change them?


davidsalter

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This is a superb set of notes covering all of the Edexcel unit specification. Students can use it to revise particular parts or all of it or use it to create their own revision resources.

Aysha Khan

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very good! although it could be alittle more condensed!

هزل, يتبادل المزاح

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follow @ben_ stott00 on twitter for eggy naans

Follow for an follow

Tosadiya

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These are excellent revision notes for unit 1 - many thanks.

Pabodha Marambe

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great help to my studies

thankz

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