H2 Economics Question

• Z een

  1 Nov 09, 23:36

  Can anyone briefly explain what i can write for the below econs question?

   

  Using economic analysis, explain the effects of an ageing population on the economy. (Macroeconomics)

• Eyelessz

  2 Nov 09, 01:44

  AS - Lower productivity? (Old => brain slower, nah kidding. But less adaptable and lowly educated?)

  AD- Lower consumption levels (Comparatively with younger people e.g purchases of houses,car etc etc and young having a tendency to follow new fashions(taste and preferences))

  Govt - Forced to spend more on supporting the old instead of investing in the economy?

• franz mavrick

  2 Nov 09, 16:54

  hmmm... structural unemployment?

  more money spent on heathcare... govt forced to divert money away from other causes to elderly care.

  lower govt tax revenue? cos old ppl retire no need pay taxes (as in income tax..still have to pay gst lol)...

  decrease productivity? mindset of older workers? need to retrain...blah blah... skills upgrading...link to spur and bleh...

  more burden on the working class... like one person support 2...

  bleh...what kind of qns is this? lol. like that i gonna fail my econs liao... zzz.

   

• Z een

  2 Nov 09, 18:56

  It's this year's cjc prelim question, 10 marks qns.

  so, in short, it causes limited economic growth and structural unemployment? Or it is dd-deficient unN since there is lower consumption?

• Eyelessz

  2 Nov 09, 19:38

  I don't really think the question is on unemployment. It's more to do with limited economic growth in both actual and potential, as well as the risk of a budget deficit.

• Violettee

  2 Nov 09, 23:50

  Why structural unemployment? There might not be a mismatch in current labour skills with those in demand even though the elderly may make up a larger demographic. Effects may include being less desirable to investment? As workforce becomes deemed as less productive,fdi diverted to other countries.this may adversely affect bop. Labour force is likely to shrink, and since it's a factor of production, there might be inward shift of ppc, productive capacity decreases,less attainable goods and services at current technology level.greater reliance on automation and technology to make up for shrinking labour force.feasible for manufacturing industry but for countries with service industry a main driver of ec growth there may be decline in ec growth as labour for services is less substitutable by automation.
• franz mavrick

  3 Nov 09, 00:35

  wah...didnt expect cjc qns to be so tough... i thought top sch qns then more tough...

• vulpes macrotis mutica

  3 Nov 09, 21:16

  Originally posted by Z een:

  Can anyone briefly explain what i can write for the below econs question?

   

  Using economic analysis, explain the effects of an ageing population on the economy. (Macroeconomics)

  what models do you guys using in H2 economics?

• Z een

  4 Nov 09, 16:58

  Models as in.....the syllabus? Or the graphs that we draw for econs?

• vulpes macrotis mutica

  4 Nov 09, 18:21

  Originally posted by Z een:

  Models as in.....the syllabus? Or the graphs that we draw for econs?

  the models that are taught in the syllabus.

  i'm doing my economics degree abroad and never had exposure to JC econs, so just wondering what models you guys use.

  eg solow growth model, mundell-fleming is-lm, ad-as, augmented philips curve, etc

  i think for the question you can talk about the problems associated with an aging population which has already been mentioned by previous posts and explain the movements through the models.

  then offer solutions for an aging population, ie import labour, encourage private health care, improve "pension" fund system, etc. basically you want to close the budget gap, trade deficit, deal with likelihood of inflation and improve human capital/capital accumulation.

  should be able to make up for 10 marks i guess :P

• Lin.thitlwin

  24 Nov 09, 18:45

  I've got a question to ask...

  Many economists argue that acheiving a low and stable rate of inflation is the most important macro-economic objective for governments.

   

  part (b). Discuss the view that a government's fiscal and monetary policies should be focused primarily on acheving a low and stable rate of inflation.

   

  I wish to ask whether this approach that I adopted is viable.

   

  Structure:

  (1). Explain briefly how contractionary fiscal and monetary policies help reduce demand-pull inflation.

  (2). Thesis: Yes, these policies should be focused mainly on solving inflation...cuz with low inflation, other macro-ecoomic objectives could be acheived (benefits of low inflation)

  (3). Anti-Thesis: No, in a case of recession like the curent situation, contractionary fiscal and monetary policies will only aggravate low economic growth and high unemployment. Hence, these policies should be employed to solw these more pressing issues instead.

   

  and so on...

   

  However, I was thinking that my structure could be flawed as I thought the main focus of the question is to evaluate the fiscal and monetary policies in curbing inflation..i.e. yes, these policies should focus on curbing inflation as they are effective in doing so...No, should not, cuz of limitations...

   

  Thanks a lot for your response.

   

• arxoz

  24 Nov 09, 22:12

  Heh Lin.thitlwin, actually i answered exactly the same way but i evaluated by saying that ...

  Countries at different stages of development has different goals.. In developed countries like Sg the government has already achieved low unemployment rate and high EG. Therefore, government of these countries can primarily employ the 2 policies to improve the Sol of its ppl by lowering the inflation.

  Developing countries and third world country who have achieving high EG as thier main goal should not primarily use these policies to achieve low and stable rate of inflation.

  nt sure if i my evaluation is correct.

   

   

   

   

• Lin.thitlwin

  24 Nov 09, 22:28

  HEY!..YOUR evaluation is exactly the same as mine!...ha2...From which JC are you from? But I hope our structures are correct....Do you think so?

• arxoz

  24 Nov 09, 22:37

  tats gd dude. most of my friends also had the same structure.

• Lin.thitlwin

  25 Nov 09, 00:14

  yeah..but juz that I'm scared for part 2 of my structure..After mentioning how the policies can acheive inflation, I just wet on the next paragraph and said "Low inflation can possibly bring about much benefits..eg. acheiving other macro goals"..then went on to explain how lowinflation acheive gd BOP, growth and low unN, but nvr clearly stated like this, "These policies should be mainly focused on low inflation cuz it can bring about benefits...."