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Home > Edgenie Sunday Schroll: Newsletter > Can’t Think of Evaluation Points? Just Ask This One Question 🙋

Welcome to the 56th edition of our Newsletter EdGenie's 📜 Sunday Scroll...

Every Sunday I send out actionable tips, tricks and real-world application insights from my 15 year experience coaching students to achieve As and A*s in their Economics A Levels via EdGenie.

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One Quick Trick to Nail Your Evaluation Every Time

Hey Genies,

Struggling to think of evaluation points?

Especially when you’re running out of time?

Here’s a simple trick:

After you've written your Analysis (KAA) paragraph, just ask yourself this one question:

In reality, is what I’ve just said actually going to happen? 🤔


That means:

To what extent is this likely to be achieved?

To what extent is the policy going to be effective?

By simply questioning the real-world impact of your point, you’ll find it easier to form a solid evaluation.

It saves time. ⏳

It gets you marks. ✅

Here are 3 examples of how to do it right:


Example 1: Expansionary Fiscal Policy


KAA: The government increases spending on infrastructure projects to boost employment and economic growth.


Evaluation: I
n reality, the success of this policy depends on how quickly the infrastructure projects can be implemented. If there are delays or inefficiencies in project management, the immediate boost to employment and growth could be much slower than expected. Also, if the economy is already close to full capacity, this extra spending may just lead to inflation rather than significant growth.

Example 2: Increasing Interest Rates to Control Inflation


KAA: The central bank raises interest rates to reduce consumer borrowing and slow down inflation.


Evaluation:
However, in reality, the effectiveness of higher interest rates depends on the level of consumer confidence. If consumer confidence is high, people may continue borrowing despite the higher rates, reducing the effectiveness of the policy. Additionally, the policy may disproportionately affect homeowners with variable-rate mortgages, causing financial strain without necessarily controlling inflation effectively.

Example 3: Tariffs on Imported Goods

KAA: A government imposes tariffs on imported goods to protect domestic industries from international competition.

Evaluation:
The actual success of tariffs depends on how domestic producers respond. If they don’t become more competitive or efficient, the long-term effect may be that consumers face higher prices without a significant improvement in domestic industries. Furthermore, trading partners may retaliate with their own tariffs, potentially harming exports and economic growth.

So, next time you get stuck, just ask yourself:


 Is this really going to happen the way I said it will?

 You’ll be surprised how quickly your evaluation falls into place.

Now go ace those essays! 💪

Emre 🧞‍♂️



​UK economy stagnated for second consecutive month in July

Summary

📉 Services sector grows slightly: The services sector expanded by a mere 0.1%, providing little relief.

💬 Chancellor acknowledges challenges: Rachel Reeves emphasised the scale of the economic difficulties and urged patience for change.

🏦 Bank of England likely to hold interest rates: Despite weaker inflation, markets expect the BoE to keep rates unchanged at 5%.

🏗️ Manufacturing and construction suffer losses: Manufacturing fell 1%, and construction output dropped by 0.4%, both underperforming.

🏆 Euros give modest economic boost: The July GDP print was disappointing despite a slight boost from the Euros.

📊 Budget pressures for Labour: PM Starmer and Chancellor Reeves are preparing for a challenging Budget with tough choices.

📉 Analysts predict further economic slowdown: Economists expect the economy to slow in the second half of 2024, with downside risks increasing.

💼 Call for growth-supporting policies: Economists stress the need for a predictable tax system and strong policies to boost business confidence.

A Level Economics Questions:

Q: Explain why the construction and manufacturing sectors are significant contributors to the UK economy’s performance.
A. Construction and manufacturing are essential for the UK economy as they create jobs, stimulate demand for materials and resources, and contribute significantly to GDP. Weakness in these sectors reduces overall economic output, as they are typically key drivers of growth, especially in terms of investment and exports.

Q: Explain the role of interest rates in managing inflation and economic growth.
A. Interest rates influence borrowing costs, which in turn affect consumer spending, business investment, and inflation. Higher rates can reduce demand and control inflation, while lower rates encourage borrowing and spending, stimulating economic growth. The Bank of England uses interest rate adjustments to keep inflation within target and manage economic expansion.

Q: Explain the potential reasons for the Bank of England’s decision to keep interest rates unchanged despite lower-than-expected inflation.
A. The Bank of England may keep interest rates unchanged to balance the risk of further slowing economic growth against the need to maintain stable inflation. While inflation is below expectations, the central bank might wait for clearer signs of economic recovery before making additional rate cuts.

Q: Discuss the impact of weak economic growth on government policy priorities, particularly for the government.
A. Weak economic growth puts pressure on the government to deliver on its promise of boosting the UK economy. It may force the government to introduce more aggressive fiscal policies, such as increased public spending or tax incentives, to stimulate growth. However, balancing these measures with the need for fiscal responsibility and inflation control will be a challenge.

Possible A Level Economics 25 Marker Question

Evaluate the potential effectiveness of an interest rate cut in stimulating economic growth in the UK.  (25 marks)

Infographic of the Week

Global Debt Reaches Record High in Q1 2024

Global debt surged to a record $315 trillion in Q1 2024, rising by $1.3 trillion compared to the previous quarter. Mature markets accounted for $209.7 trillion, or two-thirds of the total, while emerging markets reached $105.4 trillion, a significant increase over the past decade. Non-financial corporates held the largest share of emerging market debt, at $44 trillion. Although most sectors in mature markets experienced minimal debt growth, government debt saw a sharp rise of 4.5%. The Institute of International Finance (IIF) warned that inflation, trade tensions, and geopolitical risks could elevate global funding costs later in 2024.

Chart of the Week

Intra-European Trade in Goods Far Outpaces Services

Intra-European trade within the EU, benefiting from reduced trade barriers, has seen steady growth over the years. However, trade in goods significantly outpaces services, with goods representing 26.74% of GDP in 2022, compared to only 8.13% for services. Despite challenges in fully removing all trade barriers, intra-EU trade in both sectors has consistently grown, reflecting the benefits of the EU's trade freedoms for member states.

Macroeconomic Data


Whenever you're ready there is one way I can help you.

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A huge thanks for hopping on board EdGenie's Wednesday Wisdoms newsletter! 
I'm Emre, and I've got a big goal - to make A* education accessible to all A-level students.
And it Starts With You!

Emre Aksahin
Chief Learning Officer at Edgenie