AQA A-level Paper 3, June 2022

TopicMarket structuresOligopoly

TopicPrice determination in a competitive marketDemand & supplyEconomic growth & cycle

TopicMarket failure and government interventionGovernment intervention (micro)Indirect taxes & subsidies

1. Adoes not take into account irrational behaviour.
2. Benables accurate forecasts to be made.
3. Cincludes a value judgement.
4. Dmay be true or false.

TopicEconomic methodology and the economic problemPositive & normative

1. ABanning supermarkets from selling high-calorie energy drinks
2. BIncreasing taxes on high-fat products to raise their price
3. CMoving products with a high sugar content away from supermarket checkouts
4. DSubsidising fruit and vegetables to reduce their prices

TopicIndividual economic decision makingBehavioural economics

1. Agreater at X than Y.
2. Bgreater at Z than Y.
3. Cthe same at X, Y and Z.
4. Dzero when 300 units of consumer goods are produced.

TopicEconomic methodology and the economic problemOpportunity costPPB / PPC

1. A1.1%
2. B3%
3. C3.3%
4. D9%

TopicMeasuring macroeconomic performancePrice indices & inflation measurement

1. Adistribution of income.
2. Blevels of taxation.
3. Cprice levels.
4. Drates of population growth.

TopicMeasuring macroeconomic performanceLiving standards & wellbeingExchange rates

1. AInfrastructure expenditure
2. BInterest rates
3. CRates of income tax
4. DThe budget deficit

TopicFiscal policy and supply-side policiesFiscal policy & public financesAggregate demand

1. AMerit goods will no longer be underconsumed in a free market.
2. BProducers will be more likely to have to pay compensation for pollution.
3. CPublic goods will no longer be subject to the free-rider problem.
4. DThe inequality in the distribution of income and wealth will be reduced.

TopicMarket failure and government interventionMarket failure (general)

1. ADemand for scarves is price elastic.
2. BPrice elasticity of demand is –0.5.
3. CThe firm’s total revenue falls.
4. DThe firm’s total revenue increases.

TopicPrice determination in a competitive marketPrice elasticity of demandRevenue & profit

1. Alimit pricing.
2. Bmarginal cost pricing.
3. Cprice discrimination.
4. Dprice leadership.

TopicMarket structuresMonopoly & market power

1. A5%
2. B5.5%
3. C10%
4. D15.5%

TopicFinancial markets and monetary policyMoney & bankingInflation & deflation

1. Ainvestment banks have low capital-output ratios.
2. Bmost banks carry out both commercial and investment banking activities.
3. Cthe central bank acts as lender of last resort to financial institutions.
4. Dthe commercial banks have high liquidity ratios.

TopicFinancial markets and monetary policyMoney & banking

1. AA decrease in the natural rate of unemployment
2. BA loss of consumer and producer confidence
3. CA natural disaster, damaging productive capacity
4. DA rise in factor prices, resulting in cost-push inflation

TopicHow the macroeconomy works (AD/AS)Aggregate demandAggregate supply

1. AHelping countries settle disputes over tariffs and quotas
2. BLending money to countries with balance of payments problems
3. CMonitoring the stability of the international monetary system
4. DProviding loans at low rates of interest to low-income countries

TopicThe international economyProtectionism & trading blocsBalance of payments

1. ACar manufacturers’ stocks of unsold cars are low
2. BThe demand for cars is also price elastic
3. CThe marginal cost of producing cars increases significantly with output
4. DThere is considerable spare capacity in the car industry

TopicPrice determination in a competitive marketPrice elasticity of supply

1. A(see diagram in paper)
2. B(see diagram in paper)
3. C(see diagram in paper)
4. D(see diagram in paper)

TopicHow the macroeconomy works (AD/AS)Aggregate supplyTechnological change

1. ASome households have to pay more in income tax than other households.
2. BThe Gini coefficient in some countries is low.
3. CThe income of some households is significantly less than the median household income.
4. DThe prices of items that are essential for life differ between countries.

TopicDistribution of income and wealthInequality & poverty

1. Alump sum tax.
2. Bprogressive tax.
3. Cproportional tax.
4. Dregressive tax.

TopicFiscal policy and supply-side policiesFiscal policy & public financesInequality & poverty

1. AGovernment retraining schemes for structurally unemployed workers
2. BIncreasing legal protection against unfair dismissal for employees
3. CIncreasing the real value of the national minimum wage
4. DNew government subsidies for developers of artificial intelligence

TopicEconomic performanceUnemploymentSupply-side policies

1. A1+2
2. B3+4
3. C5+6
4. D7+8

TopicMarket structuresMonopoly & market powerPerfect competition

1. AAverage revenue and marginal revenue will both fall.
2. BAverage revenue and marginal revenue will not change.
3. CAverage revenue will fall and marginal revenue will increase.
4. DAverage revenue will increase and marginal revenue will fall.

TopicMarket structuresPerfect competitionRevenue & profit

1. Aaverage utility is maximised.
2. Bmarginal utility is maximised.
3. Copportunity cost is minimised.
4. Dtotal utility is maximised.

TopicIndividual economic decision makingUtility

1. ADecreasing Increasing Decreasing
2. BDecreasing Decreasing Increasing
3. CIncreasing Increasing Increasing
4. DIncreasing Decreasing Decreasing

TopicEconomic performanceEconomic growth & cycleInflation & deflationTrade & comparative advantage

1. A£227 billion
2. B£261 billion
3. C£264 billion
4. D£319 billion

TopicMeasuring macroeconomic performanceGDP & national incomePrice indices & inflation measurement

1. Amake supernormal profits.
2. Bproduce the allocatively efficient output.
3. Cproduce where average revenue = average cost.
4. Dset price equal to minimum average costs.

TopicMarket structuresMonopolistic competitionRevenue & profit

1. A(see diagram in paper)
2. B(see diagram in paper)
3. C(see diagram in paper)
4. D(see diagram in paper)

TopicFinancial markets and monetary policyMoney & banking

1. A£70 bn
2. B£100 bn
3. C£130 bn
4. D£175 bn

TopicFinancial markets and monetary policyMoney & banking

1. AOccupational immobility of labour will help to reduce structural unemployment.
2. BThe cost of living for people who live in UK seaside towns will fall.
3. CUnemployment is likely to be higher in the summer than the winter.
4. DWages in UK seaside towns will rise because firms want to retain workers.

TopicEconomic performanceUnemploymentAggregate demand

1. AThe total amount paid in wages will fall from (W2 × Q2) to (W3 × Q1).
2. BThe total amount paid in wages will increase from (W3 × Q1) to (W1 × Q1).
3. CThe wage rate will fall from W1 to W2.
4. DThe wage rate will increase from W3 to W2.

TopicThe labour marketTrade unions & monopsony

1. AA fall in the sterling exchange rate
2. BFalling emissions of greenhouse gases
3. CIncreasing life expectancy at birth
4. DReductions in income inequality

TopicMeasuring macroeconomic performanceLiving standards & wellbeingDevelopment

1. Acyclical unemployment.
2. Bfrictional unemployment.
3. Cgeographical immobility of labour.
4. Doccupational immobility of labour. 30

TopicEconomic performanceUnemployment