Revision Tips for A Level Exams

In the UK, it is currently the exam season and my students are finally thinking of doing some actual revision. These are some tips to make your revision more effective.

Learning is Active Not Passive.

if you just read a textbook from start to finish, you will struggle to learn much. Active revision means that you are constantly thinking and trying to understand the concepts involved. This is the key to successful revision. Every 15 minutes, ask yourself what have I actually learnt? Don’t measure your revision by time spent, but amount of things learnt.

Work Out The Questions That May Appear in Exam.

The most important step in revision is to know the kinds of questions that may appear in the exam. It is insufficient to just know the topics. You need to think about the kinds of questions that might appear. It is essential to get hold of past papers. Make a list of common questions and try to think of possible variations. For example, if last year you had a question. “Discuss impact of interest rates on Exchange Rates.” maybe this year will be “Discuss impact of interest rates on inflation and Balance of Payments.” See: A Level Past Papers

Test Yourself.

Make a list of things you need to learn and questions that might appear. Then close all your books. What can you remember? Make a list of what you know and then when you are stuck, check up on what you missed and make a point of trying to remember these.

Understand The Mark Scheme.

A level exams are not just about knowledge and memorising facts. There is a high weighting (up to 40%) for evaluation. This means the ability to critically examine the material you present – looking at issues from different aspects and angles.

  • See tips for writing evaluative essays
  • Using Data Responses: It is important that if you answering a data response, you actually make use of the date they give you. It may seem an obvious thing to say, but, many people forget about it. This shows that exam technique is just as important as learning

Planning

Some people spend hours creating complicated exam timetables, but, then don’t stick to it. It is important to plan your revision, but, keep it simple and realistic.

How Long To Revise for?

4 – 5 hours of revision a day is a lot. If you are revising properly and actively learning; you will make a lot of progress in 4 hours. Also, if you have a target for 4 hours a day, it doesn’t sound that intimidating. There should also be a point in the day, when you can cut off and do something completely different. Generally, it is good to get the revision sessions done early in the day; then it won’t be on the back of your mind all day.

Revise With Other People

It can be good to revise with other people; it can also be easy to get distracted and start talking of other things. Pick  your revision partners carefully, if they are more interested in chatting and gossiping, don’t try to revise with them. However, if they are committed to learning, it can be a good way to test each other and not get so bored.

Oil Price Predictions 2008

The price of oil reached another record high yesterday – $125

  • Brent Crude oil reached $126
  • US light crude oil reached $128 before setting back to $127

This means that, even adjusted for inflation, oil is now close to the all time high, last reached in the 1970s.

What are the reasons behind the Recent Increase in price of oil?

  • Strong Economic Growth. In particular growth from China and India have caused increased demand for oil and related products
  • Shortage of Supply.
  • Speculation – People have been speculating on the continued rise in price of oil. It has become an alternative to the weakening dollar.
  • Political Tensions – With the lingering threat of invasion of Iran, commentators still feel that events in the middle east could disrupt future supplies and cause higher prices.

Forecasts for the Future

Speculation or Shortage?

Some members of OPEC dispute that there is a fundamental shortage of oil. They argue that there is plentiful supply of crude oil. Therefore they argue that the recent price rises are not based on economic fundamentals, but a speculative bubble. If this is the case, oil prices could easily fall next year when market sentiment changes.

Global Growth. Some feel that the US economy is heading towards recession, because of the weakness in the housing market. However, US growth is still remarkably resilient and Global growth is being bolstered by the strong performances from the Chinese and Indian economy. With no imminent slowdown in economic growth from China, demand for oil is likely to keep rising.

The Dollar. If the dollar continues to remain weak, this will strengthen oil prices. Yesterday, the Fed said interest rates are unlikely to fall in the near future; this may help stabilise the dollar. See predictions for US dollar 2008

Related:

What Would Stop Devaluing Dollar?

Readers Question: What would stop the falling dollar?

The dollar has been falling for many reasons. These are some of the factors which would stop the dollar falling and lead to a recovery in the value of the dollar.

Higher Interest rates. US interest rates have been cut to 0% in an effort to stave off a US recession. This causes an outflow of hot money. If interest rates were raised it would encourage people to save in the US and cause an appreciation.

Recovery in US economy. The US fear recession because of a declining housing market, this is leading to lower interest rates and lower confidence about the US economy. If the economy recovered, interest rates would increase and people would have more confidence in buying dollars.

Fears Over the Euro. The main beneficiary of the falling dollar has been the Euro. People are increasingly seeing the Euro as an alternative reserve currency to the dollar. Therefore, investors have been switching out of the Dollar. However, confidence in the Euro may be misplaced. The Euro economy is not much stronger than the US. Many European economies face the prospect of falling house prices; also the strength of the Euro is causing problems for exporters. Arguably, the Euro is overvalued on economic fundamentals – the dollar looks cheap on purchasing power parity. Maybe the sell off of dollars has been overdone.

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US Recession and Indian Economy

Readers Question: Will a Recession in the US cause a recession in India?

Firstly, it is not guaranteed that there will be a recession in the US. See: – why is the US not in recession?

However, if the US does enter into recession, I don’t think this would be sufficient to cause India to enter into a recession.

Firstly, the Indian economy is growing rapidly.

Exports to US are a relatively small % of the Indian economy.

The global economy is less reliant on the US economy these days.

India’s economy is sufficiently strong to survive a drop in the growth of Aggregated Demand. In fact the Indian economy may benefit from more moderate growth, because inflationary pressures are of some concern.

Public Spending and Effect on Business

Readers Question: how can the fall in general public spending affect a business?

Public spending refers to spending by the government (the public sector). But, I wonder whether you mean fall in spending by the general public (consumer spending) ?

If there is a fall in Government spending, it will lead to lower Aggregate Demand AD. Therefore, there will be a slowdown in economic growth, and if it is serious then it may cause a recession.

If there is a fall in consumer spending it will have the same effect – there will be less demand for goods and services causing a fall in sales for business.

A fall in consumer spending will affect some business more than others. When incomes fall, we tend to reduce demand for ‘luxury good’ – private gyms, sports cars, expensive restaurants. Firms selling staple items like bus journeys, bread e.t.c. will not be really affected.

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Emerging Trends in Economics

Every couple of years, it is necessary to revise the Economics syllabus. What was important in the past, is no longer important in the future. Of course, economic fundamentals like supply and demand will always remain valid. But, the issues we apply these to will be changing.

These are some of the emerging trends in economics

There are definitley other issues that could be added to these. But, at the moment the most important 3 developments are probably.

  1. Growth of China / India
  2. Environmental issues
  3. Dealing With Commodity Shortages

Why Does Greater Wealth Lead to Less Marriage?

There is a report in the Times today, suggesting that young people can’t afford marriage – Marriage too expensive

But, on the face of it, it is absurd. When people were really poor 100 years ago, marriage rates were much higher. Despite what people may think, living standards have been gradually rising for the past 60 years. (at an average rate of 2.5% per annum)

So why, when people are richer than ever before, do people now say marriage is too expensive?

Weddings have become more expensive because people have higher expectations about what to expect at a wedding. In the past a wedding would be a simple affair, but now people want more.

People would rather save money for a deposit to get on the property ladder.

The cultural attachment to marriage is less. There is greater acceptance of people living together (in a former age it used to be called ‘living in sin’) Therefore, people find it easier to use excuses such as ‘I can’t afford it) As Anastasia de Waal, author of the report, said:

“In the past, people had to marry – but today, people want to (if convenient). The last Census and the Millennium Cohort Study reveal that marriage is out of reach for many.”

Benefits of 20 mph Zone for Cars

Currently, 3,000 people die a year on the roads in the UK. That equates to nearly 10 people a day. Interestingly, if 1 person died on the railways it would make front page news. But, 10 deaths per day, is seen as an acceptable consequence of people’s right to drive at speeds that they want. Of course, speed is not the only cause of death; but, it does make a fatal accident more likely .

Death Rates from Speeding Cars

Research from the Department for Transport indicates that:

  • 1 in 40 pedestrians struck by a car at 20mph dies, compared with 1 in 5 at 30mph.
  • At 40mph the survival rate falls to 10 per cent.
  • A 1mph cut in average vehicle speed reduces crash frequency by about 5 per cent.

A study of 250 pilot schemes for 20mph zone saw crashes fall by 60% and child fatalities fell by 67%

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Paying off Mortgage Early

Readers Question: My husband and I will recently be getting a cash settlement. We currently have a 30 year 250,000 mortgage. Is it a good idea to pay the mortgage off completely? We’ve been getting mixed responses.

One thing you can do is to work out how much interest you would pay on a 30 year £250,000 mortgage.

If you assume interest rates are 6%, then you will be paying £1,531 a month. For 30 years this will cost you  a total of £544,680

Basically, you will be spending £294,680 just on interest payments.

If you kept the mortgage and invested the £250,000 would you be able to get a better return? I think you would struggle to get sufficient dividends or capital gains to justify the opportunity cost of not paying off the mortgage. Also some investments might be risky.

Something else you could do is to pay off the mortgage now and then invest the monthly amount that you used to have to pay towards a mortgage.

Reasons Not To Pay off  A Mortgage Early

The only reason to keep the mortgage would be if:

  • There was a very high exit fee.
  • You were wanting to set up a business and required a loan to get started. If that is the case a mortgage on your house might be the best way of going about it.
  • There might be some tax advantages of keeping the mortgage.

See also: Should I pay off my Mortgage Early?

Productivity and the Current Account Deficit

Readers Question: Using the data and your own economic knowledge, evaluate the importance of rising productivity in bringing about an improvement in the UK balance of payment on the current account.

Productivity is defined as output per worker or output per input. Rising productivity implies that the economy is becoming more competitive and will be able to produce goods at a lower cost. If UK firms can produce goods at a lower cost this will make UK exports more competitive and therefore increase exports.

For example, if there is an improvement in labour productivity following better education and training, firms will be help to produce more for the same costs. This will help the UK compete and sell more exports.

Increasing exports will help improve the current account as exports will be rising relative to imports.

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