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Page 1

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GCSE ECONOMICS (OCR)

Revision Guide:
Unit 1
Markets at Work
Name: Form:

Page 2

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(A) The Basic Economic Problem
What is it?
The basic economic problem is the fact that RESOURCES are SCARCE (limited in supply)
but WANTS are INFINITE (never ending). As a result of this, consumers, producers and
the government have to make CHOICES about how to ALLOCATE scarce resources.
When we…

Page 3

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Economy There is competition- this is good for
consumers (Low prices, better quality, more choice, more innovation) There is more incentive to be
efficient as low costs can allow low prices which may be important if markets are competitive
Inequality- there will be absolute and relative poverty- poor people will…

Page 4

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In reality, most economies are mixed. This means there is a mixture of a public sector and a
private sector owning and allocating the scarce resources. The UK has a mixed economy that is
moving towards being more free market:
Public Sector: Education, Health, Police, Defence
Private Sector: Water, Electricity,…

Page 5

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Textiles, Food manufacturing; Car manufacturers;
Tertiary Sector The sector of the economy
responsible for providing services to consumers and to other businesses
Banking, Insurance, Leisure and Tourism; Catering; Advertising and Marketing
The UK now has a very large tertiary sector having been through a period of
DE-INDUSTRIALISATION. This is the…

Page 6

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The main reasons for de-industrialisation are:
· Increased competition from abroad (globalisation)
· Historically low levels of investment and productivity in the UK mean that our goods are more
expensive and poorer quality
· Higher wage and tax levels in the UK have contributed to higher costs and therefore higher,…

Page 7

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It cannot take advantage of cross-subsidising products
It does not take advantage of having existing customers who may wish to also buy a range of
products from the firm, including compliments (and impulse buys)
Consumers increasingly want to buy a range of products under one roof for convenience- they
may…

Page 8

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Firms Regional specialisation A particular region is
in the industry may
The area is very vulnerable focussed on
producing a
benefit from external
to a fall in demand for the particular good
or service.
economies of scale (the
product This means that a lot of the
idea that the growth…

Page 9

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New firms are reluctant to financially
locate to the area because supportive of the
of the above problems industry
· Suppliers move to
There is a cycle that leads the region,
to absolute and relative reducing transport
poverty costs and making supplies more flexible International specialisation
Countries specialise in
World…

Page 10

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The characteristics and functions of money
If countries/firms specialise in production, there has to be a means of exchanging goods.
Historically, this was done by BARTER and SWAPPING goods, but this was difficult for a
number of reasons. MONEY allows exchange to take place.
The Functions of Money (what it…

Comments

EstherTheBester1

Report

Thank you! This is very useful in consolidating knowledge and to think you made this yourself!

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Pages in this set

Page 1

Preview of page 1
GCSE ECONOMICS (OCR)

Revision Guide:
Unit 1
Markets at Work
Name: Form:

Page 2

Preview of page 2
(A) The Basic Economic Problem
What is it?
The basic economic problem is the fact that RESOURCES are SCARCE (limited in supply)
but WANTS are INFINITE (never ending). As a result of this, consumers, producers and
the government have to make CHOICES about how to ALLOCATE scarce resources.
When we…

Page 3

Preview of page 3
Economy There is competition- this is good for
consumers (Low prices, better quality, more choice, more innovation) There is more incentive to be
efficient as low costs can allow low prices which may be important if markets are competitive
Inequality- there will be absolute and relative poverty- poor people will…

Page 4

Preview of page 4
In reality, most economies are mixed. This means there is a mixture of a public sector and a
private sector owning and allocating the scarce resources. The UK has a mixed economy that is
moving towards being more free market:
Public Sector: Education, Health, Police, Defence
Private Sector: Water, Electricity,…

Page 5

Preview of page 5
Textiles, Food manufacturing; Car manufacturers;
Tertiary Sector The sector of the economy
responsible for providing services to consumers and to other businesses
Banking, Insurance, Leisure and Tourism; Catering; Advertising and Marketing
The UK now has a very large tertiary sector having been through a period of
DE-INDUSTRIALISATION. This is the…

Page 6

Preview of page 6
The main reasons for de-industrialisation are:
· Increased competition from abroad (globalisation)
· Historically low levels of investment and productivity in the UK mean that our goods are more
expensive and poorer quality
· Higher wage and tax levels in the UK have contributed to higher costs and therefore higher,…

Page 7

Preview of page 7
It cannot take advantage of cross-subsidising products
It does not take advantage of having existing customers who may wish to also buy a range of
products from the firm, including compliments (and impulse buys)
Consumers increasingly want to buy a range of products under one roof for convenience- they
may…

Page 8

Preview of page 8
Firms Regional specialisation A particular region is
in the industry may
The area is very vulnerable focussed on
producing a
benefit from external
to a fall in demand for the particular good
or service.
economies of scale (the
product This means that a lot of the
idea that the growth…

Page 9

Preview of page 9
New firms are reluctant to financially
locate to the area because supportive of the
of the above problems industry
· Suppliers move to
There is a cycle that leads the region,
to absolute and relative reducing transport
poverty costs and making supplies more flexible International specialisation
Countries specialise in
World…

Page 10

Preview of page 10
The characteristics and functions of money
If countries/firms specialise in production, there has to be a means of exchanging goods.
Historically, this was done by BARTER and SWAPPING goods, but this was difficult for a
number of reasons. MONEY allows exchange to take place.
The Functions of Money (what it…

Comments

EstherTheBester1

Report

Thank you! This is very useful in consolidating knowledge and to think you made this yourself!