IB Economics Course Guide
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1 IB Economics Course Guide 1
2 Basic Structure of the Course The course consists of four units: 1. Microeconomics 2. Macroeconomics 3. International Economics 4. Development Economics Though there will be some crossover, the L6th year will concentrate on the micro and national aspects of the course (units 1-2), and the U6th year will deal with the more international aspects (units 3 and 4). 2
3 Assessment Assessment of your work will be in two forms. During the course, you will complete four pieces of coursework, called Commentaries, of which three will combine to form a portfolio of work which will be marked by your teachers and moderated by the IB exam board. Your portfolio will account for 20% of your final mark for both HL and SL students. The remaining 80% will be decided by two (SL) or three (HL) exams of varying length and format, which you will sit at the end of the U6th year. Commentaries (20% of final mark) About the Portfolio Your portfolio will consist of three commentaries. These are relatively short (maximum 750 word) essays, each of which must be based on a recent news article. In the essay, you are required to use your knowledge of economics to analyse the subject matter of the article using relevant diagrams, theories and evaluation. Your Commentaries will be loosely based on the following topics, although the specifics of your work will depend upon the article you choose to analyse: 1. Demand & Supply 2. Market Failure 3. AD-AS analysis 4. International Trade Article Choice Your articles must be recent published no earlier than one year before writing the commentary. Each article must focus on different syllabus section (now only 4 micro, macro, international & development). They must be from a newspaper, a journal or the Internet. They may NOT be from TV or radio broadcasts, or podcasts. They must also be original material, i.e. unedited by anyone outside the source publication or website. As such, articles from sites such as tutor2u or Biz\ed are not suitable. They must be chosen by you although your teachers may guide you as to the suitability of your choices. They must all be from different sources - do not use the same newspaper/journal/website twice. If you are struggling to find a different source for a topic that interests you, try searching for it using Google News ( This site aggregates news stories from different publications and websites around the world, and will often offer well over a thousand different sources for the same story. Whilst the articles must all be in English, there is no restriction as to which country they originate from. There are various international journals, newspapers and websites that offer very useful material. Try to find articles which are relatively brief and do not contain any sophisticated economic analysis tabloid newspapers are often a good starting point. Whilst it may seem appropriate to use an article from, say, the Economist, it is often difficult to analyse the situation in a manner any more insightful or sophisticated than the publication already has in the original material. This leaves you little scope to show your abilities and knowledge. You do not have to use the whole article in your analysis. In fact, this often raises too many issues than can be covered in such a short essay. Instead, you may use an excerpt from the article to give your work more focus. Speak to your teacher for guidance in this regard. 3
4 Time Allocation Please see the schemes of work in this pack and the table below for details of when each commentary is to be completed. You will be given some class time for work and feedback, but it is expected that the majority of the work will be done outside of the classroom in the form of homework assignments. Presentation Commentaries should be typed up, not handwritten. Diagrams may either be created as part of the word-processed document or drawn in by hand afterwards. All commentaries must be submitted with a completed cover sheet and checklist as well as a blank feedback form for your teacher to fill in (available in electronic form on the VLE). This applies both to your first draft and final submission. To ensure that your portfolio looks neat and consistent, try to use the same style (fonts, colours, margins etc. across all of your commentaries. It is possible that your portfolio will be photocopied before being marked or sent to the board, so please make sure that all diagrams are clearly labeled and do not rely on different colours to show relationships. Instead, try using dotted or dashed lines, or lines with different-shaped data points. The word limit does not include: acknowledgements, contents pages, diagrams, labels of 5 words or fewer, diagram headings of 10 words or fewer, tables of statistical data, equations, formulae and calculations, citations (which if used must be in the main body of the commentary), and references (which if used must be in the footnotes/endnotes). Submission For each Commentary, the final internal deadline will fall one week before the relevant holiday or half term break. Whilst your teachers will set their own deadlines for drafts & feedback within this, you will NOT be able to change or correct any Commentary after the final deadline. Individual Commentary Deadlines Commentary Teacher Deadline: One Week Before Demand & Supply A L6th Christmas Holiday (HL students) L6th February Half Term (SL Students) Market Failure A L6th Summer Holidays AD-AS Analysis B L6th Summer Holidays International Trade A U6th Christmas Holiday The final portfolio comprises: A summary coversheet An individual coversheet for each commentary & the 3 commentaries together with the articles. 4
5 Marking & Feedback When you initially write your Commentaries during the course, you will not receive a numerical mark for them, although your teacher may give you an indication of the level at which you are working. Each commentary is assessed individually for the first five assessment criteria (criteria A E) and then criterion F is applied to the whole portfolio. Thus, the total points available are 45 (14 X 3 = = 45) A. Diagrams 3 marks B. Terminology 2 marks C. Application 2 marks D. Analysis 3 marks E. Evaluation 4 marks F. Rubric requirements 3 marks For more details of exactly what is covered by each of these criteria, as well as clarification of the general requirements of the portfolio, please see pages of the syllabus. Please note: your teachers will only give you formal written feedback on one draft of each commentary. You will not be able to repeatedly hand in improved versions. As such, please make sure that you take on board all feedback and informal advice and make all necessary changes before submitting your final draft. 5
6 Exams (80% of final mark) At the end of the course, you will sit two (SL) or three (HL) exams. Each may cover any or all parts of the syllabus, but their structures and mark allocations are the same each year: SL/HL Paper 1 (1 hour 30 minutes, HL: 30% of final mark, SL: 40% of final mark) This paper is split into two sections. Section A microeconomics, section B macroeconomics. Within each section you are required to answer one two-part essay question from a choice of two. Part (a) is worth 10 marks and part (b) 15. Here is an example from a past paper: You should note that the key difference between the two questions is the need for evaluation of your answer to part (b). Your teachers will give you further examples to look at/answer throughout the course. SL/HL Paper 2 (1 hour 30 minutes, HL: 30% of final mark, SL: 40% of final mark) Again, this paper is split into two sections. Section A International Economics, section B development economics. Within each section you are required to answer one data response question, from a choice of two. Each question is split into four parts; part (a) asks two short, definition-based questions worth 2 marks each. Parts (b) and (c) are short explanation questions (usually requiring a diagram) worth 4 marks each. Finally, part (d) is a slightly longer question usually requiring a longer explanation of a concept along with application and evaluation. Please see the opposite page for an example question. Your teachers will give you further examples to look at/answer throughout the course. HL Paper 3 (1 hour, 20% of final mark) This paper consists assess all areas of the syllabus, with a focus on quantitative elements. You must answer two questions from a choice of three. Each question is worth 25 marks for a total of 50 marks available. Here is an example from a past paper: Your teachers will give you further examples to look at/answer throughout the course. 6
7 Demand for chicken up after price cut 1. There has been a fall in the demand for chicken following the avian flu1 scare which led to people being afraid to eat chicken for fear of becoming ill. In response to this, chicken farmers reduced the selling price. 2. Yesterday, there was a 10 per cent increase in the sales of both processed chickens and live chickens, with some birds sold in the market nationwide. The price cuts were agreed upon at a meeting of the Federation of Livestock Farmers Association, Malaysia (FLFAM). The FLFAM is a cartel, which sets prices for livestock sales in Malaysia. It controls 80 % of the suppliers in the country. Processed chicken now costs only RM per kg and live chicken RM 2.80 per kg. Previously, the prices were RM 4.00 and RM 3.50 respectively. 3. The response is good and we hope that consumers now realise that chicken sold in Malaysia is safe to eat, said a FLFAM spokesperson, adding that the industry was worried when chicken sales dropped by a day following the avian flu outbreak in neighbouring countries. Some 1.1 million chickens are available daily to meet consumer demand. 4. The spokesperson said that the drop in prices was to overcome the excess supply of chicken in the market, adding that poultry farmers in the country were holding an Eat Chicken campaign and were considering other marketing schemes. We will continue with the current production of chicken, he said, we have decided not to reduce the supply as planned earlier when sales dropped. 5. It was feared that, if the supply were reduced, then the maximum price of chicken that had been fixed by the Agriculture Ministry, would have to be increased. The FLFAM was considering getting their baby chick supply for production from abroad, especially from Australia and the European Union countries. These would take the place of supplies from neighbouring countries, although the prices of the new imports would be higher. 6. Cattle farmers were initially hoping that the misfortune of the chicken farmers might lead to a bonus for them. However, a positive cross elasticity of demand and a fall in the price of chicken is now likely to hurt suppliers of beef and lamb if the demand for chicken continues to rise. [Source: adapted from The New Straits Times, Malaysia, February 2004] 7
8 Course Plan Below you will find the basic plan for each year of study. This is broken down into half-term blocks and shows what you will be studying with each of your teachers. HL only topics are greyed out. It also indicates when and with which teacher you will be working on your Commentaries (see pages 5-7). For a more detailed plan with space for you to insert links and book references, please see the detailed schemes of work starting on page 13. Please note: this plan is for guidance only. The order of study within any given half-term may change according your teachers preferences, though the commentary deadlines are fixed. Lower Sixth Period Teacher A Teacher B Michaelmas Term Foundation Economics 1.1: Markets o Demand o Supply o Interaction of demand & supply Michaelmas Term Lent Term Lent Term 1.2: Elasticities 1.3: Taxes, subsides & price controls o Commentary: Demand & Supply (HL students only) Christmas Holidays 1.5: Theory of the Firm o Cost theory o Short-run o Long-run o Revenues o Profit o Perfect competition o Monopoly Commentary: Demand & Supply (SL students only) 1.5: Theory of the Firm o Monopolistic competition o Oligopoly o Price discrimination Revision 2.1: Measuring National Income 2.2: Macroeconomic Models 2.3: Macroeconomic objectives o Economic Growth o Low unemployment o Low & stable inflation 2.5: Monetary Policy 2.3: Macroeconomic objectives Equity & distribution of income 2.4: Fiscal Policy 2.6: Supply-side policy Trinity Term Trinity Term Easter Holidays End of Year Exams 1.4: Market Failure Commentary: AD-AS Analysis Commentary: Market Failure Commentary review Target 2.0 Project 8
9 Upper Sixth Period Teacher A Teacher B 3.1: Reasons for Trade Growth Models: 3.1: Free Trade & Protectionism o Harrod Domar Michaelmas Term Michaelmas Term 3.4: Economic Integration 3.2: Exchange Rates Commentary: Trade International o Structural change/dual sector model Barriers to Growth and Development: o 4.3: Institutional & political factors o 4.4: Intl. Trade barriers o 4.7:Debt Growth and Development Strategies and their Evaluation: o 4.6: Aid o 4.4: Trade strategies o 4.5: FDI Lent Term Lent Term Christmas Holidays Mock Exams 3.3: Balance of Payments 4.8: Evaluation of Growth and Development Strategies o Market led vs. interventionist o Sustainable development 3.5: Terms of Trade Wrap up Wrap up Revision Revision Easter Holidays Final Exams 9
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