SlideShare una empresa de Scribd logo
1 de 14
Confidence in Handling Economic Data
Revision session showing how economic data is
presented in charts and tables and some
strategies for good use of data in your economics
exams
Different ways in which economic data is displayed
This chart
shows the
annual %
change in
real GDP
This chart
shows
index
numbers
with a
base year
of 2007
This chart
shows
data
expressed
as a % of
GDP
This chart
shows
cross-
country
data
expressed
as a % of
GDP
Notice the long time period here Are you familiar with the countries?
Confidence in Handling Economic Data in Exams
Using Figure 1, describe two significant features of the data
Figure 1: Annual labour migration into/out of UK Figure 1 shows total
inflow, outflow and net
migration figures for the
UK. In each year net
migration into the UK
was positive as inflows
exceeded outflows, the
average has been around
250,000 per year.
The figure for net
migration in 2014 was
the highest since 2005.
Inflows reached a peak
of 624,000 and 327,000
people left causing net
migration to climb to
298,999 in 2014.
1
2
Confidence in Handling Economic Data in Exams
Using Figure 1, describe two significant features of the data
Figure 1: World price of high grade copper 1. Over the period from
2000 to 2014, the
world price of copper
has increased
significantly from an
average of less than 80
US cents per pound in
2000-03 to a price
above 300 cents from
2010-2014.
2. Although copper prices
have seen a trend rise,
the price has been
volatile for example, it
fell by 28% from 2007
to 2009 before rising
by 71% in the following
two years
1
2
Confidence in Handling Data in Economics Exams
Referring to the data in Figure 1, calculate an index number for the oil price in
March 2012, using January 2005 as the base period. Show your working (6 marks)
Answer
In January 2005, figure 1
shows that the world price of
oil was $45 per barrel. The
index number for a base value
is always 100.
In March 2012, the price of oil
had risen to $125 per barrel.
Index number March 2012 =
(March12 price / Jan05 price)
x 100
= ($125/$45) x 100
= 277.8
Always remember to quote the units of measurement
in your answers to data response questions
Confidence in Handling Data in Economics Exams
With reference to the information provided, explain two possible causes of the
decrease in tobacco smoking (4 marks)
Answer
Figure 1 shows that the % of adults
smoking has more than halved from
45% in 1974 to 20% in 2010.
1. One explanation is likely to be a
rise in the real tax (duty) on
cigarettes mentioned in Extract 2
The tax has risen above inflation
thereby reducing the real
purchasing power of smokers.
2. Another factor might be the
effects of advertising bans and
ban on smoking in public places in
the last ten years mentioned in
Extract 1. Figure 1 shows a faster
rate of decline in the last ten years
reflecting an inward shift of the
market demand curve for
cigarettes.
Extract 1
Tobacco smoking has fallen over the past fifty years following government
health campaigns warning people of its dangers and greater regulations on
its sale and consumption. Higher taxes on cigarettes have also contributed
to the decline in smoking. The tax on tobacco now accounts for 80% of the
£7.45 price paid for a premium packet of cigarettes.
Extract 2
In the 2012 Budget the Chancellor George Osborne increased the tax on
tobacco by 5 percentage points above the rate of inflation (known as the
tobacco tax escalator). This added 37 pence to the price of a packet of
cigarettes.
Application
Confidence in Handling Economic Data in Exams
Index numbers for different sectors of the UK Economy
Figure 1: Index of output, 2008-2014 The chart tracks an index of
output for three key industries
in the UK economy. Service
industries such as finance and
tourism account for over 80%
of GDP (by value-added) and
this sector has seen a strong
recovery with growth in excess
of 10% since the 2nd quarter of
2010.
Construction is the most
volatile of the industries shown
in the chart. Twice since 2008,
the construction sector has
been in a recession and output
in 2014 was below levels
achieved before the 2008-09
recession.
When given data in index number format is it often a
good idea to do some quick % change calculations to
describe the extent of change in the data over time.
Note the base period
Source: HM Treasury
Confidence in Handling Economic Data in Exams
Seasonally Adjusted Data
1. The labour market is a good example of when much of the data presented is given a
seasonal adjustment. This is because the aggregate demand for labour varies at
different times of the year due to seasonal changes in the number of jobs on offer.
Examples of seasonal industries include agriculture, tourism, catering, hospitality
and retailing.
2. The purpose of seasonal adjustment is to remove the variations associated with the
time of the year for example when retail sales and employment rise in the run up to
Christmas but fall away again early in the New Year.
Source: HM Treasury
Confidence in Handling Economic Data in Exams
The growth of consumer prices and earnings – real wages
• This is one of those
macroeconomics charts that
requires careful reading in the
exam hall!
• The y-axis tells us that the data
shows the annual% change in
earnings from work and also
consumer prices
• CPI inflation (the black dotted
line) has been persistently
above the growth of earnings
• This means that for many (but
not all) real wages have fallen
each year since 2010.
• Only now with inflation falling
towards zero are real wages
starting to edge higher.
Main Data Source: HM Treasury
Avoid confusing a fall in the rate of growth with a fall in
the level of an economic variable. E.g. consumer price
inflation has been falling but the rate of inflation (until
April 2015) has remained positive.
Confidence in Handling Economic Data in Exams
International comparisons – productivity data for the G7 nations
• Often in exams, students are
asked to make a cross-country
comparison using some key
macro data.
• In this case we see a chart
showing GDP per hour worked
in 2013 for the G7 countries.
• Output per hour in the UK is
taken as the base value – what
can we imply from this data?
• The key point is that five of the
other G7 nations have higher
relative productivity. Only in
Japan is productivity (using this
measure) relatively lower
• Make sure to include the
actual data in your answer
and/or do a simple %
calculation.
Main Data Source: HM Treasury
The chart data is for one year only – it does not tell us
whether productivity was rising or falling in that year!
Confidence in Handling Economic Data in Exams
Forecast data – be aware of the uncertainty / inaccuracy!
This chart shows the annual government budget surplus / deficit over more than 30 years.
Budget surpluses are rare – the last one was fifteen years ago. But look carefully at the
chart – the light green data shows a forecast from the Office for Budgetary Responsibility.
Forecasts always carry a health warning. There are many reasons why the forecast is
unlikely to be accurate over the next five years. Main Data Source: HM Treasury
Forecast
problems
Volatile economic growth and unemployment
Hard to predict direct & indirect tax revenues
Unexpected changes in government spending
Confidence in Handling Economic Data in Exams
Trade patterns and trade balances for the UK
There is a lot of data in this
table! It would test your skills
of application!
1. Britain exported £511bn
of goods & services in
2013 but imported
£543bn – a trade deficit
of £32bn
2. Our biggest export
market is the USA but the
next four countries are all
inside the Euro Area
3. We run a large trade
surplus with the USA but
a significant trade deficit
with Germany
Main Data Source: HM Treasury
One key aspects of this data is the importance of the European
Union for the UK – 44% of exports and 52% of imports
China figures in the top three import countries but our exports
to China are a much smaller percentage of trade
Confidence in Handling Economic Data in Exams
Unemployment rates in the UK – by age
• If you get some unemployment data be careful to look at the unit of measurement
• In the chart above the unemployment rate is measured as a % of the labour force
• A long run of data is shown. It shows that youth unemployment (people aged 18 to 24) is
persistently higher than for the whole economy
• Youth unemployment surged to 20% in 2011 but has since fallen quite sharply to 15%
• This is welcome news, but it remains almost 3 times the national average rate of 5.7%
Main Data Source: HM Treasury
% of what? The
chart does not
make this clear!
Confidence in Handling Economic Data
Follow the Tutor2u team on twitter
@tutor2u Jim Riley
@tutor2u_econ Geoff Riley

Más contenido relacionado

La actualidad más candente

Edexcel Unit 4 essays mark schemes 2010-2013
Edexcel Unit 4 essays mark schemes 2010-2013Edexcel Unit 4 essays mark schemes 2010-2013
Edexcel Unit 4 essays mark schemes 2010-2013tutor2u
 
Preparing for the AS Economics Macro Paper 2012
Preparing for the AS Economics Macro Paper 2012Preparing for the AS Economics Macro Paper 2012
Preparing for the AS Economics Macro Paper 2012tutor2u
 
AS Macro Revision: Macro Objectives and Circular Flow
AS Macro Revision: Macro Objectives and Circular FlowAS Macro Revision: Macro Objectives and Circular Flow
AS Macro Revision: Macro Objectives and Circular Flowtutor2u
 
Living standards well_being
Living standards well_beingLiving standards well_being
Living standards well_beingMatthew Bentley
 
Trade cycle output_gaps
Trade cycle output_gapsTrade cycle output_gaps
Trade cycle output_gapsmattbentley34
 
Balance of payments_trade
Balance of payments_tradeBalance of payments_trade
Balance of payments_tradeMatthew Bentley
 
Long run aggregate_supply
Long run aggregate_supplyLong run aggregate_supply
Long run aggregate_supplyMatthew Bentley
 
UK Economy in 2015 - Macro Revision Presentation
UK Economy in 2015 - Macro Revision PresentationUK Economy in 2015 - Macro Revision Presentation
UK Economy in 2015 - Macro Revision PresentationEton College
 
Trade Offs between Macro Objectives
Trade Offs between Macro ObjectivesTrade Offs between Macro Objectives
Trade Offs between Macro Objectivestutor2u
 
Low Interest Rates and the UK Economy
Low Interest Rates and the UK EconomyLow Interest Rates and the UK Economy
Low Interest Rates and the UK Economytutor2u
 
AS Macroeconomics - Aspects of UK Fiscal Policy
AS Macroeconomics - Aspects of UK Fiscal PolicyAS Macroeconomics - Aspects of UK Fiscal Policy
AS Macroeconomics - Aspects of UK Fiscal Policytutor2u
 
Threats to UK Economic Recovery
Threats to UK Economic RecoveryThreats to UK Economic Recovery
Threats to UK Economic Recoverytutor2u
 
AS Macro Revision: Fiscal Policy
AS Macro Revision: Fiscal PolicyAS Macro Revision: Fiscal Policy
AS Macro Revision: Fiscal Policytutor2u
 
AS Macro Revision Aggregate Demand
AS Macro Revision Aggregate DemandAS Macro Revision Aggregate Demand
AS Macro Revision Aggregate Demandtutor2u
 
AS Macro Revision - The Balance of Payments
AS Macro Revision - The Balance of PaymentsAS Macro Revision - The Balance of Payments
AS Macro Revision - The Balance of Paymentstutor2u
 
AS Macro Revision: Migration and the Economy
AS Macro Revision: Migration and the EconomyAS Macro Revision: Migration and the Economy
AS Macro Revision: Migration and the Economytutor2u
 

La actualidad más candente (19)

Edexcel Unit 4 essays mark schemes 2010-2013
Edexcel Unit 4 essays mark schemes 2010-2013Edexcel Unit 4 essays mark schemes 2010-2013
Edexcel Unit 4 essays mark schemes 2010-2013
 
Preparing for the AS Economics Macro Paper 2012
Preparing for the AS Economics Macro Paper 2012Preparing for the AS Economics Macro Paper 2012
Preparing for the AS Economics Macro Paper 2012
 
AS Macro Revision: Macro Objectives and Circular Flow
AS Macro Revision: Macro Objectives and Circular FlowAS Macro Revision: Macro Objectives and Circular Flow
AS Macro Revision: Macro Objectives and Circular Flow
 
Living standards well_being
Living standards well_beingLiving standards well_being
Living standards well_being
 
Trade cycle output_gaps
Trade cycle output_gapsTrade cycle output_gaps
Trade cycle output_gaps
 
Balance of payments_trade
Balance of payments_tradeBalance of payments_trade
Balance of payments_trade
 
Long run aggregate_supply
Long run aggregate_supplyLong run aggregate_supply
Long run aggregate_supply
 
UK Economy in 2015 - Macro Revision Presentation
UK Economy in 2015 - Macro Revision PresentationUK Economy in 2015 - Macro Revision Presentation
UK Economy in 2015 - Macro Revision Presentation
 
Trade Offs between Macro Objectives
Trade Offs between Macro ObjectivesTrade Offs between Macro Objectives
Trade Offs between Macro Objectives
 
Low Interest Rates and the UK Economy
Low Interest Rates and the UK EconomyLow Interest Rates and the UK Economy
Low Interest Rates and the UK Economy
 
AS econ session 3
AS econ session 3AS econ session 3
AS econ session 3
 
Aidan ferris
Aidan ferrisAidan ferris
Aidan ferris
 
Uk economy update 2015
Uk economy update 2015Uk economy update 2015
Uk economy update 2015
 
AS Macroeconomics - Aspects of UK Fiscal Policy
AS Macroeconomics - Aspects of UK Fiscal PolicyAS Macroeconomics - Aspects of UK Fiscal Policy
AS Macroeconomics - Aspects of UK Fiscal Policy
 
Threats to UK Economic Recovery
Threats to UK Economic RecoveryThreats to UK Economic Recovery
Threats to UK Economic Recovery
 
AS Macro Revision: Fiscal Policy
AS Macro Revision: Fiscal PolicyAS Macro Revision: Fiscal Policy
AS Macro Revision: Fiscal Policy
 
AS Macro Revision Aggregate Demand
AS Macro Revision Aggregate DemandAS Macro Revision Aggregate Demand
AS Macro Revision Aggregate Demand
 
AS Macro Revision - The Balance of Payments
AS Macro Revision - The Balance of PaymentsAS Macro Revision - The Balance of Payments
AS Macro Revision - The Balance of Payments
 
AS Macro Revision: Migration and the Economy
AS Macro Revision: Migration and the EconomyAS Macro Revision: Migration and the Economy
AS Macro Revision: Migration and the Economy
 

Destacado

Consequences of Financial Crises
Consequences of Financial CrisesConsequences of Financial Crises
Consequences of Financial Crisestutor2u
 
Econ 1 25 mark question
Econ 1 25 mark questionEcon 1 25 mark question
Econ 1 25 mark questioneclements
 
Finding Historic Economic Data
Finding Historic Economic DataFinding Historic Economic Data
Finding Historic Economic DataLynda Kellam
 
Analysis of economic data using big data
Analysis of economic data using big data Analysis of economic data using big data
Analysis of economic data using big data Shivu Manjesh
 
Financial market and economic data: The Fifth Elephant
Financial market and economic data: The Fifth ElephantFinancial market and economic data: The Fifth Elephant
Financial market and economic data: The Fifth ElephantDeepak Shenoy
 
A2 Micro Unit 3 Revision Advice
A2 Micro Unit 3 Revision AdviceA2 Micro Unit 3 Revision Advice
A2 Micro Unit 3 Revision AdviceEton College
 
Economic Indicator Analysis
Economic Indicator AnalysisEconomic Indicator Analysis
Economic Indicator AnalysisSeun Aboderin
 
Measures of Economic Performance
Measures of Economic PerformanceMeasures of Economic Performance
Measures of Economic Performancemattbentley34
 
Statistical Techniques in Business & Economics (McGRAV-HILL) 12 Edt. Chapter ...
Statistical Techniques in Business & Economics (McGRAV-HILL) 12 Edt. Chapter ...Statistical Techniques in Business & Economics (McGRAV-HILL) 12 Edt. Chapter ...
Statistical Techniques in Business & Economics (McGRAV-HILL) 12 Edt. Chapter ...tarta
 
D12 1 risk assessment_final-web
D12 1 risk assessment_final-webD12 1 risk assessment_final-web
D12 1 risk assessment_final-webDir Jan
 
Improving Evaluation Skills in A Level Economics exam answers
Improving Evaluation Skills in A Level Economics exam answersImproving Evaluation Skills in A Level Economics exam answers
Improving Evaluation Skills in A Level Economics exam answerstutor2u
 
All Things Data - Core Tools for Economic Development Practitioners
All Things Data - Core Tools for Economic Development PractitionersAll Things Data - Core Tools for Economic Development Practitioners
All Things Data - Core Tools for Economic Development PractitionersTom Dworetsky, AICP
 
Statistics assignment 5
Statistics assignment 5Statistics assignment 5
Statistics assignment 5Ishaq Ahmed
 
Debt Relief for Poorer Countries
Debt Relief for Poorer CountriesDebt Relief for Poorer Countries
Debt Relief for Poorer Countriestutor2u
 
Chapter 04
Chapter 04Chapter 04
Chapter 04bmcfad01
 
Thoughts on Improving Your Economics Papers
Thoughts on Improving Your Economics PapersThoughts on Improving Your Economics Papers
Thoughts on Improving Your Economics Paperstutor2u
 
Chapter 11
Chapter 11Chapter 11
Chapter 11bmcfad01
 
Chapter 02
Chapter 02Chapter 02
Chapter 02bmcfad01
 

Destacado (20)

Consequences of Financial Crises
Consequences of Financial CrisesConsequences of Financial Crises
Consequences of Financial Crises
 
Econ 1 25 mark question
Econ 1 25 mark questionEcon 1 25 mark question
Econ 1 25 mark question
 
Finding Historic Economic Data
Finding Historic Economic DataFinding Historic Economic Data
Finding Historic Economic Data
 
Analysis of economic data using big data
Analysis of economic data using big data Analysis of economic data using big data
Analysis of economic data using big data
 
Chapter 2
Chapter 2Chapter 2
Chapter 2
 
Financial market and economic data: The Fifth Elephant
Financial market and economic data: The Fifth ElephantFinancial market and economic data: The Fifth Elephant
Financial market and economic data: The Fifth Elephant
 
A2 Micro Unit 3 Revision Advice
A2 Micro Unit 3 Revision AdviceA2 Micro Unit 3 Revision Advice
A2 Micro Unit 3 Revision Advice
 
Economic Indicator Analysis
Economic Indicator AnalysisEconomic Indicator Analysis
Economic Indicator Analysis
 
Chapter 2 PowerPoint
Chapter 2 PowerPointChapter 2 PowerPoint
Chapter 2 PowerPoint
 
Measures of Economic Performance
Measures of Economic PerformanceMeasures of Economic Performance
Measures of Economic Performance
 
Statistical Techniques in Business & Economics (McGRAV-HILL) 12 Edt. Chapter ...
Statistical Techniques in Business & Economics (McGRAV-HILL) 12 Edt. Chapter ...Statistical Techniques in Business & Economics (McGRAV-HILL) 12 Edt. Chapter ...
Statistical Techniques in Business & Economics (McGRAV-HILL) 12 Edt. Chapter ...
 
D12 1 risk assessment_final-web
D12 1 risk assessment_final-webD12 1 risk assessment_final-web
D12 1 risk assessment_final-web
 
Improving Evaluation Skills in A Level Economics exam answers
Improving Evaluation Skills in A Level Economics exam answersImproving Evaluation Skills in A Level Economics exam answers
Improving Evaluation Skills in A Level Economics exam answers
 
All Things Data - Core Tools for Economic Development Practitioners
All Things Data - Core Tools for Economic Development PractitionersAll Things Data - Core Tools for Economic Development Practitioners
All Things Data - Core Tools for Economic Development Practitioners
 
Statistics assignment 5
Statistics assignment 5Statistics assignment 5
Statistics assignment 5
 
Debt Relief for Poorer Countries
Debt Relief for Poorer CountriesDebt Relief for Poorer Countries
Debt Relief for Poorer Countries
 
Chapter 04
Chapter 04Chapter 04
Chapter 04
 
Thoughts on Improving Your Economics Papers
Thoughts on Improving Your Economics PapersThoughts on Improving Your Economics Papers
Thoughts on Improving Your Economics Papers
 
Chapter 11
Chapter 11Chapter 11
Chapter 11
 
Chapter 02
Chapter 02Chapter 02
Chapter 02
 

Similar a Confidence in Handling Economic Data

Handling Data in AS and A2 Economics
Handling Data in AS and A2 EconomicsHandling Data in AS and A2 Economics
Handling Data in AS and A2 Economicstutor2u
 
Global economy-watch-april-2015
Global economy-watch-april-2015Global economy-watch-april-2015
Global economy-watch-april-2015PwC España
 
4th Qtr Year End 2011 Economic Review Feb 15 [Autosaved] [Autosaved]
4th Qtr Year End 2011 Economic  Review Feb 15 [Autosaved] [Autosaved]4th Qtr Year End 2011 Economic  Review Feb 15 [Autosaved] [Autosaved]
4th Qtr Year End 2011 Economic Review Feb 15 [Autosaved] [Autosaved]Gary Crosbie
 
4th Qtr Year End 2011 Economic Review Feb 15 [Autosaved] [Autosaved]
4th Qtr Year End 2011 Economic  Review Feb 15 [Autosaved] [Autosaved]4th Qtr Year End 2011 Economic  Review Feb 15 [Autosaved] [Autosaved]
4th Qtr Year End 2011 Economic Review Feb 15 [Autosaved] [Autosaved]Gary Crosbie
 
4th Qtr Year End 2011 Economic Review Feb 15 [Autosaved] [Autosaved]
4th Qtr Year End 2011 Economic  Review Feb 15 [Autosaved] [Autosaved]4th Qtr Year End 2011 Economic  Review Feb 15 [Autosaved] [Autosaved]
4th Qtr Year End 2011 Economic Review Feb 15 [Autosaved] [Autosaved]Gary Crosbie
 
4th Qtr Year End 2011 Economic Review Feb 15 [Autosaved] [Autosaved]
4th Qtr Year End 2011 Economic  Review Feb 15 [Autosaved] [Autosaved]4th Qtr Year End 2011 Economic  Review Feb 15 [Autosaved] [Autosaved]
4th Qtr Year End 2011 Economic Review Feb 15 [Autosaved] [Autosaved]Gary Crosbie
 
Executive summaryThis is report is developed to understand th.docx
Executive summaryThis is report is developed to understand th.docxExecutive summaryThis is report is developed to understand th.docx
Executive summaryThis is report is developed to understand th.docxelbanglis
 
Fiscal Policy (Austerity) in the UK Economy
Fiscal Policy (Austerity) in the UK EconomyFiscal Policy (Austerity) in the UK Economy
Fiscal Policy (Austerity) in the UK Economytutor2u
 
AS Macro - Unemployment and the Labour Market
AS Macro - Unemployment and the Labour MarketAS Macro - Unemployment and the Labour Market
AS Macro - Unemployment and the Labour Markettutor2u
 
UK Economic Update - COVID-19
UK Economic Update - COVID-19UK Economic Update - COVID-19
UK Economic Update - COVID-19The Pathway Group
 

Similar a Confidence in Handling Economic Data (20)

Handling Data in AS and A2 Economics
Handling Data in AS and A2 EconomicsHandling Data in AS and A2 Economics
Handling Data in AS and A2 Economics
 
Economic Review 2015-12
Economic Review 2015-12Economic Review 2015-12
Economic Review 2015-12
 
AS econ session 4
AS econ session 4AS econ session 4
AS econ session 4
 
Economic Review 2015-11
Economic Review 2015-11Economic Review 2015-11
Economic Review 2015-11
 
Global economy-watch-april-2015
Global economy-watch-april-2015Global economy-watch-april-2015
Global economy-watch-april-2015
 
4th Qtr Year End 2011 Economic Review Feb 15 [Autosaved] [Autosaved]
4th Qtr Year End 2011 Economic  Review Feb 15 [Autosaved] [Autosaved]4th Qtr Year End 2011 Economic  Review Feb 15 [Autosaved] [Autosaved]
4th Qtr Year End 2011 Economic Review Feb 15 [Autosaved] [Autosaved]
 
Economic Growth Of The Uk Economy
Economic Growth Of The Uk EconomyEconomic Growth Of The Uk Economy
Economic Growth Of The Uk Economy
 
Economic Review 2016-01
Economic Review 2016-01Economic Review 2016-01
Economic Review 2016-01
 
4th Qtr Year End 2011 Economic Review Feb 15 [Autosaved] [Autosaved]
4th Qtr Year End 2011 Economic  Review Feb 15 [Autosaved] [Autosaved]4th Qtr Year End 2011 Economic  Review Feb 15 [Autosaved] [Autosaved]
4th Qtr Year End 2011 Economic Review Feb 15 [Autosaved] [Autosaved]
 
4th Qtr Year End 2011 Economic Review Feb 15 [Autosaved] [Autosaved]
4th Qtr Year End 2011 Economic  Review Feb 15 [Autosaved] [Autosaved]4th Qtr Year End 2011 Economic  Review Feb 15 [Autosaved] [Autosaved]
4th Qtr Year End 2011 Economic Review Feb 15 [Autosaved] [Autosaved]
 
The Economy in 2014
The Economy in 2014The Economy in 2014
The Economy in 2014
 
Welsh Government Future Trends 2017: economy and infrastructure
Welsh Government Future Trends 2017:  economy and infrastructureWelsh Government Future Trends 2017:  economy and infrastructure
Welsh Government Future Trends 2017: economy and infrastructure
 
Fiscal policy
Fiscal policyFiscal policy
Fiscal policy
 
Fiscal policy
Fiscal policyFiscal policy
Fiscal policy
 
4th Qtr Year End 2011 Economic Review Feb 15 [Autosaved] [Autosaved]
4th Qtr Year End 2011 Economic  Review Feb 15 [Autosaved] [Autosaved]4th Qtr Year End 2011 Economic  Review Feb 15 [Autosaved] [Autosaved]
4th Qtr Year End 2011 Economic Review Feb 15 [Autosaved] [Autosaved]
 
Executive summaryThis is report is developed to understand th.docx
Executive summaryThis is report is developed to understand th.docxExecutive summaryThis is report is developed to understand th.docx
Executive summaryThis is report is developed to understand th.docx
 
Fiscal Policy (Austerity) in the UK Economy
Fiscal Policy (Austerity) in the UK EconomyFiscal Policy (Austerity) in the UK Economy
Fiscal Policy (Austerity) in the UK Economy
 
AS Macro - Unemployment and the Labour Market
AS Macro - Unemployment and the Labour MarketAS Macro - Unemployment and the Labour Market
AS Macro - Unemployment and the Labour Market
 
UK Economic Update - COVID-19
UK Economic Update - COVID-19UK Economic Update - COVID-19
UK Economic Update - COVID-19
 
Labour productivity
Labour productivityLabour productivity
Labour productivity
 

Más de Eton College

Revision on Royal Mail Privatisation
Revision on Royal Mail PrivatisationRevision on Royal Mail Privatisation
Revision on Royal Mail PrivatisationEton College
 
Royal Mail Privatisation
Royal Mail PrivatisationRoyal Mail Privatisation
Royal Mail PrivatisationEton College
 
Economics of Crossrail
Economics of CrossrailEconomics of Crossrail
Economics of CrossrailEton College
 
Economics of Crossrail (Microeconomics)
Economics of Crossrail (Microeconomics)Economics of Crossrail (Microeconomics)
Economics of Crossrail (Microeconomics)Eton College
 
AS Macro Supply Side Competitiveness
AS Macro Supply Side CompetitivenessAS Macro Supply Side Competitiveness
AS Macro Supply Side CompetitivenessEton College
 
AS Macro Supply Side and Competitiveness
AS Macro Supply Side and CompetitivenessAS Macro Supply Side and Competitiveness
AS Macro Supply Side and CompetitivenessEton College
 
Ed Conway Presentation to Tutor2u ETNC 2013
Ed Conway Presentation to Tutor2u ETNC 2013Ed Conway Presentation to Tutor2u ETNC 2013
Ed Conway Presentation to Tutor2u ETNC 2013Eton College
 
Linda Yueh on prospects for the Chinese economy
Linda Yueh on prospects for the Chinese economyLinda Yueh on prospects for the Chinese economy
Linda Yueh on prospects for the Chinese economyEton College
 
Tim Harford on Bill Phillips and the Water Machine
Tim Harford on Bill Phillips and the Water MachineTim Harford on Bill Phillips and the Water Machine
Tim Harford on Bill Phillips and the Water MachineEton College
 
AS Macro Key Term Glossary
AS Macro Key Term GlossaryAS Macro Key Term Glossary
AS Macro Key Term GlossaryEton College
 
AS Micro Markets and Market Failure Key Term Glossary
AS Micro Markets and Market Failure Key Term GlossaryAS Micro Markets and Market Failure Key Term Glossary
AS Micro Markets and Market Failure Key Term GlossaryEton College
 
Economic Development and Growth Glossary
Economic Development and Growth GlossaryEconomic Development and Growth Glossary
Economic Development and Growth GlossaryEton College
 
Unit 3 Business Economics Glossary
Unit 3 Business Economics GlossaryUnit 3 Business Economics Glossary
Unit 3 Business Economics GlossaryEton College
 
Behavioural Economics
Behavioural EconomicsBehavioural Economics
Behavioural EconomicsEton College
 
A2 Microeconomics Pricing Power
A2 Microeconomics Pricing PowerA2 Microeconomics Pricing Power
A2 Microeconomics Pricing PowerEton College
 
AS Micro Rent Controls in Housing
AS Micro Rent Controls in HousingAS Micro Rent Controls in Housing
AS Micro Rent Controls in HousingEton College
 
Micro Finance Fair Trade and Development
Micro Finance Fair Trade and DevelopmentMicro Finance Fair Trade and Development
Micro Finance Fair Trade and DevelopmentEton College
 
Aid and Economic Development
Aid and Economic DevelopmentAid and Economic Development
Aid and Economic DevelopmentEton College
 
Paul Ormerod at the Tutor2u Conference
Paul Ormerod at the Tutor2u ConferencePaul Ormerod at the Tutor2u Conference
Paul Ormerod at the Tutor2u ConferenceEton College
 
AS Micro Government Intervention
AS Micro Government InterventionAS Micro Government Intervention
AS Micro Government InterventionEton College
 

Más de Eton College (20)

Revision on Royal Mail Privatisation
Revision on Royal Mail PrivatisationRevision on Royal Mail Privatisation
Revision on Royal Mail Privatisation
 
Royal Mail Privatisation
Royal Mail PrivatisationRoyal Mail Privatisation
Royal Mail Privatisation
 
Economics of Crossrail
Economics of CrossrailEconomics of Crossrail
Economics of Crossrail
 
Economics of Crossrail (Microeconomics)
Economics of Crossrail (Microeconomics)Economics of Crossrail (Microeconomics)
Economics of Crossrail (Microeconomics)
 
AS Macro Supply Side Competitiveness
AS Macro Supply Side CompetitivenessAS Macro Supply Side Competitiveness
AS Macro Supply Side Competitiveness
 
AS Macro Supply Side and Competitiveness
AS Macro Supply Side and CompetitivenessAS Macro Supply Side and Competitiveness
AS Macro Supply Side and Competitiveness
 
Ed Conway Presentation to Tutor2u ETNC 2013
Ed Conway Presentation to Tutor2u ETNC 2013Ed Conway Presentation to Tutor2u ETNC 2013
Ed Conway Presentation to Tutor2u ETNC 2013
 
Linda Yueh on prospects for the Chinese economy
Linda Yueh on prospects for the Chinese economyLinda Yueh on prospects for the Chinese economy
Linda Yueh on prospects for the Chinese economy
 
Tim Harford on Bill Phillips and the Water Machine
Tim Harford on Bill Phillips and the Water MachineTim Harford on Bill Phillips and the Water Machine
Tim Harford on Bill Phillips and the Water Machine
 
AS Macro Key Term Glossary
AS Macro Key Term GlossaryAS Macro Key Term Glossary
AS Macro Key Term Glossary
 
AS Micro Markets and Market Failure Key Term Glossary
AS Micro Markets and Market Failure Key Term GlossaryAS Micro Markets and Market Failure Key Term Glossary
AS Micro Markets and Market Failure Key Term Glossary
 
Economic Development and Growth Glossary
Economic Development and Growth GlossaryEconomic Development and Growth Glossary
Economic Development and Growth Glossary
 
Unit 3 Business Economics Glossary
Unit 3 Business Economics GlossaryUnit 3 Business Economics Glossary
Unit 3 Business Economics Glossary
 
Behavioural Economics
Behavioural EconomicsBehavioural Economics
Behavioural Economics
 
A2 Microeconomics Pricing Power
A2 Microeconomics Pricing PowerA2 Microeconomics Pricing Power
A2 Microeconomics Pricing Power
 
AS Micro Rent Controls in Housing
AS Micro Rent Controls in HousingAS Micro Rent Controls in Housing
AS Micro Rent Controls in Housing
 
Micro Finance Fair Trade and Development
Micro Finance Fair Trade and DevelopmentMicro Finance Fair Trade and Development
Micro Finance Fair Trade and Development
 
Aid and Economic Development
Aid and Economic DevelopmentAid and Economic Development
Aid and Economic Development
 
Paul Ormerod at the Tutor2u Conference
Paul Ormerod at the Tutor2u ConferencePaul Ormerod at the Tutor2u Conference
Paul Ormerod at the Tutor2u Conference
 
AS Micro Government Intervention
AS Micro Government InterventionAS Micro Government Intervention
AS Micro Government Intervention
 

Confidence in Handling Economic Data

  • 1. Confidence in Handling Economic Data Revision session showing how economic data is presented in charts and tables and some strategies for good use of data in your economics exams
  • 2. Different ways in which economic data is displayed This chart shows the annual % change in real GDP This chart shows index numbers with a base year of 2007 This chart shows data expressed as a % of GDP This chart shows cross- country data expressed as a % of GDP Notice the long time period here Are you familiar with the countries?
  • 3. Confidence in Handling Economic Data in Exams Using Figure 1, describe two significant features of the data Figure 1: Annual labour migration into/out of UK Figure 1 shows total inflow, outflow and net migration figures for the UK. In each year net migration into the UK was positive as inflows exceeded outflows, the average has been around 250,000 per year. The figure for net migration in 2014 was the highest since 2005. Inflows reached a peak of 624,000 and 327,000 people left causing net migration to climb to 298,999 in 2014. 1 2
  • 4. Confidence in Handling Economic Data in Exams Using Figure 1, describe two significant features of the data Figure 1: World price of high grade copper 1. Over the period from 2000 to 2014, the world price of copper has increased significantly from an average of less than 80 US cents per pound in 2000-03 to a price above 300 cents from 2010-2014. 2. Although copper prices have seen a trend rise, the price has been volatile for example, it fell by 28% from 2007 to 2009 before rising by 71% in the following two years 1 2
  • 5. Confidence in Handling Data in Economics Exams Referring to the data in Figure 1, calculate an index number for the oil price in March 2012, using January 2005 as the base period. Show your working (6 marks) Answer In January 2005, figure 1 shows that the world price of oil was $45 per barrel. The index number for a base value is always 100. In March 2012, the price of oil had risen to $125 per barrel. Index number March 2012 = (March12 price / Jan05 price) x 100 = ($125/$45) x 100 = 277.8 Always remember to quote the units of measurement in your answers to data response questions
  • 6. Confidence in Handling Data in Economics Exams With reference to the information provided, explain two possible causes of the decrease in tobacco smoking (4 marks) Answer Figure 1 shows that the % of adults smoking has more than halved from 45% in 1974 to 20% in 2010. 1. One explanation is likely to be a rise in the real tax (duty) on cigarettes mentioned in Extract 2 The tax has risen above inflation thereby reducing the real purchasing power of smokers. 2. Another factor might be the effects of advertising bans and ban on smoking in public places in the last ten years mentioned in Extract 1. Figure 1 shows a faster rate of decline in the last ten years reflecting an inward shift of the market demand curve for cigarettes. Extract 1 Tobacco smoking has fallen over the past fifty years following government health campaigns warning people of its dangers and greater regulations on its sale and consumption. Higher taxes on cigarettes have also contributed to the decline in smoking. The tax on tobacco now accounts for 80% of the £7.45 price paid for a premium packet of cigarettes. Extract 2 In the 2012 Budget the Chancellor George Osborne increased the tax on tobacco by 5 percentage points above the rate of inflation (known as the tobacco tax escalator). This added 37 pence to the price of a packet of cigarettes. Application
  • 7. Confidence in Handling Economic Data in Exams Index numbers for different sectors of the UK Economy Figure 1: Index of output, 2008-2014 The chart tracks an index of output for three key industries in the UK economy. Service industries such as finance and tourism account for over 80% of GDP (by value-added) and this sector has seen a strong recovery with growth in excess of 10% since the 2nd quarter of 2010. Construction is the most volatile of the industries shown in the chart. Twice since 2008, the construction sector has been in a recession and output in 2014 was below levels achieved before the 2008-09 recession. When given data in index number format is it often a good idea to do some quick % change calculations to describe the extent of change in the data over time. Note the base period Source: HM Treasury
  • 8. Confidence in Handling Economic Data in Exams Seasonally Adjusted Data 1. The labour market is a good example of when much of the data presented is given a seasonal adjustment. This is because the aggregate demand for labour varies at different times of the year due to seasonal changes in the number of jobs on offer. Examples of seasonal industries include agriculture, tourism, catering, hospitality and retailing. 2. The purpose of seasonal adjustment is to remove the variations associated with the time of the year for example when retail sales and employment rise in the run up to Christmas but fall away again early in the New Year. Source: HM Treasury
  • 9. Confidence in Handling Economic Data in Exams The growth of consumer prices and earnings – real wages • This is one of those macroeconomics charts that requires careful reading in the exam hall! • The y-axis tells us that the data shows the annual% change in earnings from work and also consumer prices • CPI inflation (the black dotted line) has been persistently above the growth of earnings • This means that for many (but not all) real wages have fallen each year since 2010. • Only now with inflation falling towards zero are real wages starting to edge higher. Main Data Source: HM Treasury Avoid confusing a fall in the rate of growth with a fall in the level of an economic variable. E.g. consumer price inflation has been falling but the rate of inflation (until April 2015) has remained positive.
  • 10. Confidence in Handling Economic Data in Exams International comparisons – productivity data for the G7 nations • Often in exams, students are asked to make a cross-country comparison using some key macro data. • In this case we see a chart showing GDP per hour worked in 2013 for the G7 countries. • Output per hour in the UK is taken as the base value – what can we imply from this data? • The key point is that five of the other G7 nations have higher relative productivity. Only in Japan is productivity (using this measure) relatively lower • Make sure to include the actual data in your answer and/or do a simple % calculation. Main Data Source: HM Treasury The chart data is for one year only – it does not tell us whether productivity was rising or falling in that year!
  • 11. Confidence in Handling Economic Data in Exams Forecast data – be aware of the uncertainty / inaccuracy! This chart shows the annual government budget surplus / deficit over more than 30 years. Budget surpluses are rare – the last one was fifteen years ago. But look carefully at the chart – the light green data shows a forecast from the Office for Budgetary Responsibility. Forecasts always carry a health warning. There are many reasons why the forecast is unlikely to be accurate over the next five years. Main Data Source: HM Treasury Forecast problems Volatile economic growth and unemployment Hard to predict direct & indirect tax revenues Unexpected changes in government spending
  • 12. Confidence in Handling Economic Data in Exams Trade patterns and trade balances for the UK There is a lot of data in this table! It would test your skills of application! 1. Britain exported £511bn of goods & services in 2013 but imported £543bn – a trade deficit of £32bn 2. Our biggest export market is the USA but the next four countries are all inside the Euro Area 3. We run a large trade surplus with the USA but a significant trade deficit with Germany Main Data Source: HM Treasury One key aspects of this data is the importance of the European Union for the UK – 44% of exports and 52% of imports China figures in the top three import countries but our exports to China are a much smaller percentage of trade
  • 13. Confidence in Handling Economic Data in Exams Unemployment rates in the UK – by age • If you get some unemployment data be careful to look at the unit of measurement • In the chart above the unemployment rate is measured as a % of the labour force • A long run of data is shown. It shows that youth unemployment (people aged 18 to 24) is persistently higher than for the whole economy • Youth unemployment surged to 20% in 2011 but has since fallen quite sharply to 15% • This is welcome news, but it remains almost 3 times the national average rate of 5.7% Main Data Source: HM Treasury % of what? The chart does not make this clear!
  • 14. Confidence in Handling Economic Data Follow the Tutor2u team on twitter @tutor2u Jim Riley @tutor2u_econ Geoff Riley