Eco Exam

[sam.utute]

A relaxation of the criteria that need to be met does not mean an increase in the quantity of immigrants: it only means that those immigrants that do gain entry have less skills to contribute to the production process, decreasing AS

We debated over Q3 for like an hour. And we're still not 100% set on the answer. I've emailed the former Chief Examiner - hopefully he gets back to me with his thoughts soon.

I should mention, I went with C for Q3 as well, but the majority at Connect felt that D was more appropriate. It helps justify it if you think of it along these lines:
Obviously, A and B are good for AS. So we either need to identify an option that is unfavourable, or an option that is favourable.
Now, C talks about keeping people at school for longer; I don't think it's unreasonable to assume that VCAA would present this as a favourable option for AS - that is, if people stay at school for longer, they're more skilled and able to contribute more to AS. That seems to send a great message to students. If we follow this logic, then D must be the answer. And this can be justified based on the assumption that increases in unskilled migrants would not add to overall levels of AS.

Hope that made sense. I'll post up the comments from the former Examiner as soon as he replies.

Thanks for the feedback so far guys.

[randomposter]

" I would argue that D was the correct answer to Q.8. Household savings ratio is defined by the ABS as savings as a percentage of disposable income. If monetary policy is loosened undoubtedly spending would increase but at the same time many households are likely to use the extra savings to either pay back loans faster or save. There is room for spending as a result of increases in discretionary income to increase while savings as a percentage of disposable income to increase alongside the increase in spending.

The increase in savings is evidenced by what happened to savings over 2008-09 alongside monetary policy loosening. I would also not be surprised to see that savings ratios would be increasing now alongside our record low cash rate in Australia. I agonised over whether the answer was B or D in the exam room but decided the D in the end was the only answer that could stand up to contemporary evidence.

What is the argument for B being the correct answer?

I think this is way too convoluted, although it may be true, but the *better* answer is B.
Simply put, increased spending means that one saves less money.

Also I think you're wrong for question 3. Although the criteria for skilled immigration will be decreased-the migrants would still be "skilled"-which VCAA clearly states. Going to be interesting what VCAA says the answer is-I interpreted relaxation of skills criteria being that more already trained individuals would be in the labour force-a clear benefit for AS.

Relaxation of skills criteria means that more immigrants will be able to enter Australia and join the labour force. Increasing the school leaving-age means that less teenagers will be able to enter the labour force.
Quantitatively, more people (despite how skilled they may/may not be), will increase AS. Once again, C is the *better* answer.

[sam.utute]

Relaxation of skills criteria means that more immigrants will be able to enter Australia and join the labour force. Increasing the school leaving-age means that less teenagers will be able to enter the labour force.
Quantitatively, more people (despite how skilled they may/may not be), will increase AS. Once again, C is the *better* answer.

This was my reasoning as well. But again, we're still operating under the assumption that we're a democracy over at Connect.

If I had sat the exam, I would have selected C as the best answer for Q3. Will be interesting to see how the Examiner justifies his answer. Again, a much too ambiguous question for my liking. The conflict between "quantity" and "quality" of labour seems unnecessary.

[Kuchiki]

This was my reasoning as well. But again, we're still operating under the assumption that we're a democracy over at Connect.

If I had sat the exam, I would have selected C as the best answer for Q3. Will be interesting to see how the Examiner justifies his answer. Again, a much too ambiguous question for my liking. The conflict between "quantity" and "quality" of labour seems unnecessary.

I personally would have answered C, too, especially since the other two options (pension age, childcare subsidies) seem to be hinting more towards the quantity of labour.

[gobuddy23hawkers]

Omg noooo, I changed it at the last minute. 
Are you sure? But wouldn't the wages of public services rise/fall in response to changes in demand? Causing more/less tax revenue? Or do they not pay taxes at all because they work for the government? And also, they had "unemployment payments" and "social welfare payments" as different things. :/ Would "social welfare payments" imply that it's more for things like long term disabilities/pensions etc. that aren't affected by AD compared to unemployment? HAHA I'm so confused and I guess it doesn't matter now but it's really bugging me.

Did the same as you. Its because even though you may consider the change in the business cycle to create and eliminate a certain amount of jobs the change is NOT COUNTER CYCLICAL and this is a key factor of an automatic stabilizer. For example poor demand side conditions would reduce the amount of jobs.

[chasej]

Did the same as you. Its because even though you may consider the change in the business cycle to create and eliminate a certain amount of jobs the change is NOT COUNTER CYCLICAL and this is a key factor of an automatic stabilizer. For example poor demand side conditions would reduce the amount of jobs.

Also it said "wages of people servants" which I interpret meaning the  wages each worker receives-wages tend to be sticky and not change at all at least not downwards. Not the aggregate amount the government pays in wages to public servants.

[sam.utute]

Relaxation of skills criteria means that more immigrants will be able to enter Australia and join the labour force. Increasing the school leaving-age means that less teenagers will be able to enter the labour force.
Quantitatively, more people (despite how skilled they may/may not be), will increase AS. Once again, C is the *better* answer.

Okay, so the response:

Q3 relates to the size of the workforce and A, B & D would all lead to an increase in AS, but C in keeping students at school longer would decrease AS. D is wrong because a relaxation of the criteria would possibly see more immigrant workers arrive not just those to satisfy skill shortages.

Q8 relates to what normally happens to consumer spending and savings with a fall in interest rates. Normally spending rises and savings falls, so B. The recent complication involves not only consumer confidence but also alternative investments, shares become more attractive due to their returns. Lower interest rates also encourage some households to pay same amount and thus pay loan off faster. Economic theory v recent history? I still think B

I'm updating our solutions to reflect this.

[abcdqdxD]

Okay, so the response:

I'm updating our solutions to reflect this.

Having done all VCAA 2002-2012 MC, I can comfortably say that for AS questions the focus has always been on quantity. I think this is because something quantitative is more absolute so to speak, qualitative is more of a matter of judgement. I know that VCAA is eager to stay away from ambiguity. I don't think VCAA themselves thought about the quality aspect of the question given what they've dished up in the past.

I think that C is correct hands down (what are the arguments for C being incorrect?), but D *may* be correct.

[sam.utute]

Having done all VCAA 2002-2012 MC, I can comfortably say that for AS questions the focus has always been on quantity. I think this is because something quantitative is more absolute so to speak, qualitative is more of a matter of judgement. I know that VCAA is eager to stay away from ambiguity. I don't think VCAA themselves thought about the quality aspect of the question given what they've dished up in the past.

Yay! I'm so happy I thought I stuffed it up, but I'm glad my Eco streak continues!

That said, who knows how Anita will interpret the question.

See our FB for arguments against. Basically, having people in school longer = better skilled workforce.

[abcdqdxD]

Yay! I'm so happy I thought I stuffed it up, but I'm glad my Eco streak continues!

That said, who knows how Anita will interpret the question.

See our FB for arguments against. Basically, having people in school longer = better skilled workforce.

I had a brief look last night look then closed it out of fear

I think when they decide on the solutions they have a meeting where all the assessors have equal input. Pretty sure what the chief assessor says isn't absolute.

To be honest, when I did the question I only saw C as a valid response. I've been so conditioned for looking for changes in quantity by past exams. If they select D, then they're really not consistent with how they've marked in the past. I doubt VCAA will mark both C and D correct, I think this is about the only question that may separate the top end.

[chasej]

Okay, so the response:

I'm updating our solutions to reflect this.

Yeh. I suppose in regards to q8 I'm just trying to justify my own silly mistake (changing answer in last minute) really.

[abcdqdxD]

Yeh. I suppose in regards to q8 I'm just trying to justify my own silly mistake (changing answer in last minute) really.

In theory, your response is incorrect. In the real world, your response is correct. But since we live in VCE world, not everything obeys the circumstances of the real world

[sam.utute]

Yeh. I suppose in regards to q8 I'm just trying to justify my own silly mistake (changing answer in last minute) really.

NOOOOOOOOOOOOO!!!    

That's my one of my GOLDEN RULES FOR MULTIPLE CHOICE QUESTIONS! Never change an answer at the last minute!*

*unless you've misread the question.

[chasej]

NOOOOOOOOOOOOO!!!    

That's my one of my GOLDEN RULES FOR MULTIPLE CHOICE QUESTIONS! Never change an answer at the last minute!*

*unless you've misread the question.

I know I remember thinking in the exam, as I was debating the question, "but it said in the connect notes not to change them". So annoying as it's the 3rd or 4th time a similar thing has happened to me this year, was annoying after doing it in SACs but devo for an exam.

Anyway, hopefully I smashed Section B to make up for it . At least none of my subjects next year have MC sections AFAIK

[abcdqdxD]

It's not THAT bad to change your response is it?

If I'm over 75% sure in my new answer then I'll change it