UNL81 Introduction to Economics

Course Outline
About the Course
The unit is a preparatory economics unit designed to help you gain the necessary
knowledge to enter into a tertiary study. In this unit, you will learn why economics
focuses on decisions about how production occurs, how resources are allocated and
how proceeds of production are distributed. Decisions about the allocation of
resources require an understanding of the interdependence of economic factors.
Economic, political and social forces influence economic decision making, the quality of
which is fundamental to the overall wellbeing of society. These economic decisions not
only affect the wellbeing of particular nations and their people but also increasingly
influence living standards regionally and globally.

This unit includes individual tutorial support with an experienced high school
economics teacher. Tutorial support is via email, phone and Zoom The unit has flexible
enrolment dates to meet your needs. Start your study when you want and complete
the unit anytime within the 12 month enrolment window. This unit is equivalent to year
11/12 Economics. This unit requires a minimum of 220 hours or 18 weeks to complete.

Aim
The Australian economy is a contemporary market capitalist economy. In such an
economy, the principal means of allocating scarce resources is the price mechanism.
Students examine the factors that affect the price and quantity traded in individual
markets.

Students investigate the importance of competition and analyse the degree of market
power in different industries and how this affects the efficiency of resource allocation.

Students also come to appreciate that markets will not always lead to the most efficient
allocation of resources. Through an examination of market failure, students are able to
explain situations where the market does not operate freely and discuss the role of
government in the allocation of resources.

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Areas of study:
• The behaviour of consumers and businesses
• Contemporary Economic Issues
• Economic Efficiency and Equity
• Global Economic Issues
• Australia’s Economic Prosperity
• Managing the Australian Economy

Structure
UNL81 Introduction to Economics course consists of 2 text books. Questions and
Exercises are included within each text so that the learner can work through them
to develop experience in problem solving. Worked Solutions for the questions and
exercises are provided at the back of each text.

Progress Tests are also provided at appropriate points in the course. Students are
required to successfully complete ten (10) of these progress tests and four (4)
Activities to be eligible to sit for the final examination.

Tutorial Support is available from the UNL81 Introduction to Economics Teacher.

This support, which can be accessed by the online classroom, phone or email, is
designed to help students clarify understanding of concepts, to provide details of
solutions to exercises, and to answer other relevant queries.

Specimen Examination
The specimen exam or practice final exam is available once you have completed
approximately 80% of the course. The practice exam allows students to work
through similar problems under exam conditions which allow them to see if they are
pacing themselves appropriately to be successful on the final exam. Most students
who are successful on the practice exam find they are successful on the final exam
as they are prepared for the type of questions and the exam format they will have
during the final exam.

Hours of Study
In general the course should be completed in a minimum of 220 hours of study. The
actual time required by an individual student to receive a successful result,
however, will depend on the background, time available and needs of the learner. A
majority of students take 540 hours to complete the course over the 12 months.

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Assessment
The chapter questions, the end-of-chapter exercises, the progress tests, activities
and the Specimen Examination are designed to help students prepare for the final
examination for UNL81 Introduction to Economics, which is 2 hrs 40 mins long.
Examinations are prepared and assessed by the UNL81 Introduction to Economics
Teacher.

To be eligible to sit for the final, closed book examination, students are required to
achieve a mark of 60% or higher each on ALL progress tests and lab activities. The
formal, supervised examination covers the content of tests 1 and 2. Students who
successfully complete the course, are awarded a Statement of Achievement, which
lists the percentage mark gained and a grade of Pass, Credit, Distinction or High
Distinction. Students who fail to obtain the minimum mark required for a Pass
grade, after submitting a reasonable attempt, may then be eligible to sit a second
examination at the teachers’ discretion. Examinations are not held at set times.
Rather, they are arranged through the Unilearn office after the student has
successfully completed the required materials with a score of 60% or higher on
each. Or students can choose to complete their exam through ProctorU.

Grading Scheme
Students are required to complete all required materials (progress tests and lab
activities) with a score of 60% or above on each in order to be eligible to sit the final
exam. A student’s final grade is an accumulation of all required content and will be
weighted as follows:

Progress Tests 25%

Activities 25%
Final Exam 50%
100%

The final grading scale is as follows:

Grade % required
High Distinction (HD) 85% and above
Distinction (D) 75 - 84%
Credit (C) 65 – 74%
Pass (P) 50 - 64%
Fail 0 – 49%

Content
Jacaranda Key Concepts in VCE Economics Books 1 & 2 (11 edition) by Richard
Morris (2019)
ISBN: 9780730373445 & 9780730373773

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 Course Outline
Unit 1 – The behaviour of consumers and businesses

Topic 1 – Thinking like an economist

1. What is Economics about?
2. Micro vs macroeconomics; behavioural Vs traditional economic theory
3. The Economic Problem
4. The problem of relative scarcity, choice and the concept of opportunity cost
5. Production possibility frontier
6. Two sector circular flow model
7. Consumer Behaviour
8. Business behaviour, the business cycle

Topic 2 Decision making in markets

1. Types of markets in Australia

2. Pure competition, monopolistic competition, oligopoly, monopoly

3. The law of demand – movement along the curve
4. The law of Supply – movement along the curve
5. Determining equilibrium price and quantity in markets
6. Shifts in D-S curves from non-price effects
7. Constructing d-s curves and showing equilibrium price and quantity
8. Case studies of markets

9. Correcting market failure through government intervention in Australia’s market economy

Unit 2 Contemporary Economic Issues

Topic 3 Economic growth, long term prosperity and environmental sustainability

1. the meaning and measurement living standards, economic growth and sustainable development
2. Measuring economic growth using real gross domestic product (GDP) and real GDP 2
3. per capita
4. the economic benefits of economic growth
5. the limitations associated with using GDP per capita to measure changes in living standards
6. aggregate demand and aggregate supply factors that may influence economic growth and factors that
7. might affect future rates of economic growth
8. government economic policy responses designed to influence the rate of economic growth such as
9. budgetary policy, monetary policy and aggregate supply policies
10. The five sector circular flow model
11. the meaning of both long-term economic prosperity and environmental sustainability
12. trade-offs and compatibility between economic growth and environmental sustainability
13. policy response used to address environmental effects of economic growth
14. The business cycle and links to economic growth
15. alternative economic indicators of living standards

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Topic 4 Economic efficiency and equity issues
1. The nature of income and wealth
2. Measures of income inequality and poverty
3. Trends in Australian distribution of income and wealth
4. Factors affecting Australian distribution of income and wealth
5. The effect of poverty on material and non-material living standards
6. The meaning of economic efficiency and the benefits of achieving allocative and technical efficiency
Government policies for promoting an equitable distribution of income and wealth

Topic 5 Global Economic Issues

5.1 Free Trade vs Protectionism

1. Opportunity cost

2. Comparative advantage

3. Free trade vs protectionism

4. The nature and effects of government policies involving protectionism as opposed to free trade- tariffs, subsidies
5. Trends in trade liberalisation
6. Trading Blocs
7. China’s growth due to trading success
5.2 Globalisation
1. Definition and nature of economic globalisation
2. The acceleration of economic globalisation
3. Reasons for the growth of global business
4. The effects of globalisation on stakeholders and the overall economy
5.3 Developing nations and overcoming poverty
1. Definition and indicators of a developing nation
2. Using the human development index (HDI) to define a developing nation
3. The challenges and causes of poverty, low incomes and other problems in developing nations
4. Some government policy solutions to promote development and improve living standards in low-income
5. countries International action taken to promote sustainable development and reduce poverty in
low-income countries

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Topic 3 Australia’s economic prosperity
Unit 6 – An introduction to microeconomics: the market system, resource allocation
and government intervention

1. Market mechanisms- pure market mechanisms Relative scarcity, elasticity

2. Choice, opportunity cost and resource allocation

3. The nature and general effects of markets in Australia’s economy

4. Microeconomics: the market as an important decision maker in Australia’s economy
5. Reasons for market failure and government intervention in Australia’s economy
6. Government intervention in markets that unintentionally leads to reduced efficiency or failure

Unit 7 – Economic activity and Australia’s Domestic macroeconomic goals

1. Overall level of activity-the difference between material and non-material living standards

2. factors that may influence living standards

3. the circular flow model of income including the role of households, businesses, government, financial institutions and

the external sector in an open contemporary macro-economy

4. the nature and causes of the business cycle

5. the meaning and importance of aggregate demand and the factors that may influence the level of aggregatedemand

in the economy:

6. the meaning and importance of aggregate supply and the factors that may influence the level of aggregate

supply in the economy:

7. the effects of changes in aggregate demand and aggregate supply

8. The Australian Government’s domestic macroeconomic goals

9. : the meaning of the goal of low inflation (price stability)

10. measurement of the inflation rate using the Consumer Price Index (CPI) including the difference between the

headline and underlying (core) rate of inflation

11. limitations of measuring and using CPI

12. causes of inflation including demand and cost inflation

13. consequences of a high inflation rate:

14. the meaning of the goal of strong and sustainable economic growth

15. limitations of using GDP and alternatives

16. Full employment as an economic goal

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 17. Limitations of using unemployment stats

18. Labour force, participation rates

Unit 8 - Australia and the world economy

1. The relationship between trade and living standards

2. Government goals of external balance
3. Recording international transactions on the balance of payments account
4. The current account deficit and its causes
5. The net foreign debt (NFD)
6. The terms of trade, trade weighted index
7. The exchange rate
8. Australia’s international competitiveness
9. Trading partners, exports and imports
10. The effect of trade liberalisation on Australia’s international competitiveness, domestic macroeconomic
goals and living standards

Topic 4 – Managing the Economy

Unit 9 – Aggregate demand policies and domestic economic stability
• 9.1 Fiscal Policy
1. Sources of government revenue including direct and indirect taxation, revenue from government businesses and the
sale of government assets
2. Types of government expenses including government current and capital expenditure and transfer payments
3. Budget outcome: balanced, deficit or surplus
4. Ways government may finance a deficit or utilise a surplus
5. The relationship between the budget outcome and the level of government (public) debt
6. Role of automatic stabilisers (cyclical component of the budget)
7. Role of discretionary stabilisers (structural component of the budget) the business cycle
8. The stance of budgetary policy: expansionary or contractionary
9. Effect of budget initiatives from the past two years on the Australian Government’s domestic macroeconomic goals of str
and low inflation
10. the strengths and weaknesses of using budgetary policy to achieve the Australian Government’s domestic
11. Macro-economic goals and how these goals may affect living standards.
• 9.2 Monetary Policy
1. Role of the RBA with respect to monetary policy as outlined in its charter
2. Role of open market operations in altering interest rates

3. The stance of monetary policy: expansionary or contractionary

4. Focus of monetary policy from the past two years on the levels of aggregate demand and the
5. Australian Government’s domestic macroeconomic goals of strong and sustainable economic growth,
full employment and low inflation
6. Strengths and weaknesses of using monetary policy to achieve the Australian Government’s
domestic macroeconomic goals and how these goals may affect living standards

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Unit 10 – Aggregate supply policies and domestic economic stability
1. Definition and aims of aggregate supply policies
2. How selected government budgetary policies can influence aggregate supply, domestic macroeconomic
3. goals and living standards
4. How welfare and tax reform policies are designed to influence aggregate supply and living standards
5. Effect of immigration policies on the labour market and aggregate supply, and the way this influences the
6. achievement of domestic macroeconomic goals and living standards
7. Strengths and weaknesses of using aggregate supply policies to achieve the Australian government’s

8. domestic macroeconomic goals and better living standards

9. Allocative efficiency, intertemporal

10. National infrastructure

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