Unit 11 - Personal Economics
1.1 Understanding the Personal Lifecycle
|Students should understand the idea of a personal lifecycle and the different stages within the cycle. Students should appreciate how at each stage, individuals will experience changes in their income, expenditure, savings and debt. |
Students should be aware of the difference between needs and wants and how these change over the personal lifecycle.
1.2 Making Decisions
Students should understand that as income is a scarce resource and wants are unlimited, choices need to be made.
Students should understand the importance of weighing up costs and benefits and considering opportunity costs when making decisions.
1.3 Choosing to Spend
Students should understand the meaning of demand and the factors that affect spending.
Students should appreciate how moving to different stages in the personal lifecycle result in changes in demand for different types of goods and services.
Students should have a basic understanding of how markets for goods operate and understand the reasons why prices change.
1.4 Choosing to Save
Students should understand why people save and be aware of the main methods available, eg using banks, building societies and National Savings. Students are only required to have a basic understanding of shares and unit trusts and the working of the stock market.
Students should be able to recommend suitable methods of saving and other financial products for different situations and justify their recommendations, appreciating the risks and rewards of each method.
1.5 Choosing to Borrow Money
Students should understand why people borrow money and be aware of the main methods of borrowing, eg mortgages, credit/store cards, personal loans, hire purchase and overdrafts.
Students should be able to select suitable methods of borrowing for different situations and justify their recommendations. They should take into account the degree of risk involved and the importance of the Annual Percentage Rate (APR).
1.6 Managing your Money
Students should understand the benefits of financial planning and budgeting, including debt management. The timings of such planning should be linked to changes in the personal lifecycle.
Students should be aware of how factors such as redundancy, unemployment and sickness/disability, changes in interest rates and prices affect a person's budget and how financial planning can make some allowance for these uncertainties.
Students should explore some of the moral and ethical dilemmas that arise when making spending, saving and borrowing decisions, eg buying shares in companies making armaments or buying products from companies that exploit workers in developing countries.
2.1 Understanding the Purpose and Nature of Work
Students should understand what is meant by work and the reasons why people work or do not work. Students should understand how work is a key part of economic activity in which goods and services are produced to satisfy needs and wants.
Students should be aware of the specialised nature of work and understand the advantages and disadvantages of specialisation to the worker.
2.2 Understanding the Reward for Work
Students should understand the main methods by which people are paid and the different items that appear on a pay slip including: deductions made for income tax, national insurance and pension contributions.
Students should understand the difference between gross and net pay.
Students should understand how the supply of labour is affected by a person's decision to work or not to work, and that this is influenced by both monetary and non monetary considerations, eg incentives, location, gender and race, taxation, state benefits etc.
2.3 Understanding the Consequences of Unemployment
Students should understand the monetary and non monetary costs of unemployment to the individual and to society.
Students should understand the reasons why the duration of unemployment might vary between individuals.
Students should understand why government is concerned about unemployment and the benefits available to those who are unemployed, linking these to the personal life cycle.
The National and Global Economy
3.1 Understanding International Trade
Students should be aware of the main types of exports from, and imports to, the UK economy.
Students should appreciate the advantages resulting from global trade such as lower prices, increased availability and choice of goods for consumers, but also the disadvantages in terms of unstable commodity prices and the adverse effects on producers in the UK, as well as the wider social and environmental impact.
3.2 Exchange Rates
Students should understand the impact of exchange rates on the importing and exporting of goods and services.
Students should be aware of other factors that affect the sales of imports to, and exports from, the UK.
|3.3 The Power of the Consumer||Students should understand how the actions of consumers can impact upon the national and global economy through activities such as: boycotting the products of 'sweat shop labour', purchasing fair trade or locally sourced products produced in a sustainable, ethical and environmentally sensitive manner. They should appreciate the role played by government, eg in campaigning for reductions in World poverty.|
3.4 Understanding the Impact of the Global Economy on Work
Students should be aware of the advantages and disadvantages of firms operating overseas including the difference in labour costs.
Students should understand the positive and negative effects that globalisation has on the UK labour market, eg causing unemployment in some sectors and regions, but creating job opportunities in others. They should be aware of the role played by government in regulating the migration of labour.
This unit will be assessed by an external written assessment of 70 marks and 1 hour 15 minutes in length.