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Ch 8 2.7 Role of government in microeconomics: complete notes
Neat, exam-ready notebook-style notes for Ch 8 2.7 Role of government in microeconomics, following the IB Diploma syllabus, SL and HL. This chapter is part of the complete Economics Notes for IB Diploma Students (SL and HL): All 30 Topics.
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Free preview: Ch 8 2.7 Role of government in microeconomics notes
A quick look at the chapter from our IB Diploma Economics notes. The full chapter notes have the detailed explanations, diagrams and practice questions with answers.
Topics in this chapter
- What you must be able to do
- Why governments intervene, and how AO2
- The main forms of intervention in this topic
- Price ceiling (maximum price) AO2 AO4
- Price floor (minimum price) AO2 AO4
- Calculating the effects of price controls AO4
- Indirect taxes AO2 AO4
- Subsidies AO2 AO4
- Calculating the effects of taxes and subsidies AO4
- Direct provision, regulation and nudges AO2 AO3
- Comparing the tools: consequences for markets and stakeholders AO3
“I can” checklist: what you must be able to do
- I can explain reasons for intervention: revenue, supporting firms and low-income households, production, consumption, market failure and equity.
- I can draw and explain price ceilings and price floors, with effects on markets and stakeholders.
- I can draw and explain indirect taxes and subsidies, including who bears the tax and who gains.
- I can explain direct provision of services and command and control regulation and legislation.
- I can evaluate the consequences of government intervention for markets and stakeholders.
- HL: I can explain how consumer nudges influence choices.
- HL: I can calculate the effects of ceilings, floors, taxes and subsidies on consumers, producers and the government.
What is inside the full chapter notes
- Reasons and forms of intervention, with stakeholders
- Diagrams: price ceiling, price floor, indirect tax, subsidy
- HL calculations: surplus, revenue, tax incidence, government cost, welfare loss (8 worked examples in all)
- Direct provision, regulation and nudges compared
- Common mistakes and a "How to score" command-term box
- 12 Quick-check questions A-D, explained
- Paper 1 style (a) 10 + (b) 15 with mark scheme and markbands
- Paper 2 style data response (36 marks) with mark scheme
- HL Paper 3 style policy question (18 marks) with mark scheme
- Quick reference and "I can" checklist
What you get in the pack
- All 30 topics of IB Diploma Economics for students taking Standard Level or Higher Level (first assessment 2022): what economics is, demand, supply, market equilibrium, behavioural economics, elasticity, government intervention, externalities, public goods, asymmetric information, market power, equity, measuring economic activity, aggregate demand and supply, macroeconomic objectives, inequality and poverty, monetary policy, fiscal policy, supply-side policies, international trade, trade protection, economic integration, exchange rates, balance of payments, sustainable development, measuring development, growth and development strategies
- Every syllabus statement covered in order, each marked SL or HL, with clear notes, tables and diagrams drawn for these notes
- Every diagram the guide names, drawn and labelled, plus worked examples and model answers that show how to earn the marks
- Quick-check multiple-choice questions with explained answers, plus original Paper 1 (extended response), Paper 2 (data response) and, for HL, Paper 3 (policy) style questions with full mark schemes (no past-paper reprints)
- Common mistakes and a how-to-score command-term guide for every topic
- Quick-reference sheet and an "I can" checklist at the end of every topic
- Colour PDF and a black and white copy of every chapter for printing
- Independent notes for IB Diploma students; not endorsed by or affiliated with the International Baccalaureate Organization (IBO)
All chapters in this pack
- Ch 1 1.1-1.2 What is economics? and How do economists approach the world?
- Ch 2 2.1 Demand
- Ch 3 2.2 Supply
- Ch 4 2.3 Competitive market equilibrium
- Ch 5 2.4 Critique of the maximizing behaviour of consumers and producers
- Ch 6 2.5 Elasticity of demand
- Ch 7 2.6 Elasticity of supply
- Ch 8 2.7 Role of government in microeconomics
- Ch 9 2.8 Market failure: externalities and common pool resources
- Ch 10 2.9 Market failure: public goods
- Ch 11 2.10 Market failure: asymmetric information (HL)
- Ch 12 2.11 Market failure: market power (HL)
- Ch 13 2.12 The market's inability to achieve equity (HL)
- Ch 14 3.1 Measuring economic activity and illustrating its variations
- Ch 15 3.2 Aggregate demand and aggregate supply
- Ch 16 3.3 Macroeconomic objectives
- Ch 17 3.4 Economics of inequality and poverty
- Ch 18 3.5 Demand management: monetary policy
- Ch 19 3.6 Demand management: fiscal policy
- Ch 20 3.7 Supply-side policies
- Ch 21 4.1 Benefits of international trade
- Ch 22 4.2 Types of trade protection
- Ch 23 4.3 Arguments for and against trade control and protection
- Ch 24 4.4 Economic integration
- Ch 25 4.5 Exchange rates
- Ch 26 4.6 Balance of payments
- Ch 27 4.7 Sustainable development
- Ch 28 4.8 Measuring development
- Ch 29 4.9 Barriers to economic growth and/or economic development
- Ch 30 4.10 Economic growth and/or economic development strategies