5 Step Approach (merit/demerit goods)

1. Identify divergent (gap between MSC and MPC) and give an example (of the private and
external costs)
2. Identify equilibrium point
3. Identify problem
4. What causes the problem?
5. What is the concern, why bother and what are the consequences?

Elasticity (PED, XED, YED, PES)

1.
2.
3.
4.

definition
Formula, sign (+ or -) and what does it mean
Application
Graph (optional)

Comparison/Differentiation
1. Create criteria
2. Compare

Solving Economic Problems

INTRODUCTION: Identify and explain problem (causes and implications)
BODY:

Suggest policies and explain how it works

Evaluate (feasibility, effectiveness, constraints, trade-offs, substainability)

CONCLUSION: Overall judgement

Discussing Different Perspectives

1. Explain validity
2. Explain Failings (subjective statements)
3. Synthesis, overview

Equilibrium
Prove by contradiction
1. State why it cannot stay above
2. State why it cannot stay below
3. Explain why it will stay at the equilibrium point