Unit 3: Business behaviour · WEC13/01

Edexcel International A-level Unit 3, January 2023

All 8 written questions and 6 multiple choice questions from Edexcel International A-level Unit 3 (January 2023), Business behaviour. Case studies: The UK energy market. Each question shows its marks and topic, and opens the question paper and mark scheme at the right page.

Question paper Mark scheme Examiner report

Section A

Q11 mark

Which one of the following is the reason why the MC curve slopes upwards from point X to point Y?

ADecreasing returns to scale
BIncreasing fixed costs
CDiminishing returns
DDiseconomies of scale

Show the answer

The answer is C.

TopicRevenues, costs and profits

Question paper p.2 Mark scheme p.4 Examiner report p.5 Open in the tool

Q21 mark

Which one of the following is the firm's average variable cost at this level of output?

A$0.90
B$1.03
C$1.93
D$2.60

Show the answer

The answer is A.

TopicRevenues, costs and profits

Question paper p.3 Mark scheme p.4 Examiner report p.5 Open in the tool

Q31 mark

Which one of the following government measures is most likely to increase the occupational mobility of labour?

AAn increase in unemployment benefits
BAn increase in relocation grants for businesses
CAn increase in training schemes
DAn increase in the national minimum wage

Show the answer

The answer is C.

TopicThe labour market

Question paper p.3 Mark scheme p.4 Examiner report p.5 Open in the tool

Q41 mark

Which one of the following can be deduced from this diagram?

AThe firm is dynamically efficient
BThe firm is making normal profit
CThe firm operates in a perfectly competitive market
DThe firm will shut-down in the short-run

Show the answer

The answer is B.

TopicRevenues, costs and profits

Question paper p.4 Mark scheme p.4 Examiner report p.5 Open in the tool Practise the perfect competition diagram Practise the monopolistic competition diagram

Q51 mark

Which one of the following is the most likely impact of this decision?

AA fall in the number of workers employed by the firm
BAn increase in the price of the good
CA fall in the firm's total fixed costs
DAn increase in the firm's output

Show the answer

The answer is D.

TopicRevenues, costs and profits

Question paper p.4 Mark scheme p.5 Examiner report p.5 Open in the tool

Q61 mark

Which one of the following is the most likely reason for this value of the elasticity of demand for labour?

ALabour cannot be easily replaced by capital
BWage rates are relatively high in the agricultural industry
CConsumer demand for the final product is price elastic
DProductivity is relatively low in the agricultural industry

Show the answer

The answer is A.

TopicThe labour market

Question paper p.5 Mark scheme p.5 Examiner report p.5 Open in the tool

Section B

Case study

The UK energy market

Extracts: Figure 1: The UK wholesale price of natural gas, pence per therm*, · Figure 2: Market share of companies supplying natural gas, Q4 2020 and Q4 2021 (%) · Extract A: The UK energy market · Extract B: UK Government support for consumers · Figure 1: : https://www.thetimes.co.uk/article/b9862172-b1aa-11ec-8b8c-0207c0fd6104?shareToken=331dddc29573a7930c · Figure 2: : https://www.ofgem.gov.uk/energy-data-and-research/data-portal/all-available-charts?sort=created&page=2

In the extracts: ON Energy UK, British Gas, EDF UK, Scottish Power, Ofgem, Octopus, Ovo, Pence, Purchasing, Small-sized

Q7(a)Calculate2 marks

With reference to Figure 1, calculate the percentage change in the wholesale price of gas from 1 April 2021 to 1 April 2022. You are advised to show your working.

Mark splitApplication 2

TopicBusiness growth, mergers and market structure

Question paper p.6 Mark scheme p.6 Examiner report p.3 Open in the tool

Q7(b)Explain4 marks

With reference to Figure 2 and the second paragraph of Extract A, explain what is meant by the term 'concentration ratio'.

Mark splitKnowledge 2Application 2

TopicBusiness growth, mergers and market structure

Question paper p.6 Mark scheme p.7 Examiner report p.6 Open in the tool

Q7(c)Analyse6 marks

With reference to Figure 2 and Extract A, analyse two barriers to entry that might prevent a new firm from entering the UK energy market.

Mark splitKnowledge 2Application 2Analysis 2

TopicPerfect competition and monopoly

Question paper p.6 Mark scheme p.8 Examiner report p.6 Open in the tool

Q7(d)Examine8 marks

With reference to Figure 1 and Extract A, examine the impact of the increase in the wholesale price of natural gas on the cost of production for UK gas suppliers.

Mark splitKnowledge 2Application 2Analysis 2Evaluation 2

TopicBusiness growth, mergers and market structure

Question paper p.6 Mark scheme p.9 Examiner report p.6 Open in the tool

Q7(e)Discuss14 marks

With reference to Extract A and Extract B, discuss the likely effects of the increase in the energy price cap on both energy suppliers and consumers. Illustrate your answer with an appropriate cost and revenue diagram.

Mark splitEvaluation 6

TopicBusiness growth, mergers and market structure

Question paper p.6 Mark scheme p.10 Examiner report p.3 Open in the tool Draw it: maximum price diagram Or: monopoly diagram

Section C

Q8OptionalEvaluate20 marks

Evaluate the view that the objectives of state-owned enterprises and private sector organisations always differ. Illustrate your answer with an appropriate diagram(s).

TopicCompetition policy and government intervention

Question paper p.16 Mark scheme p.14 Examiner report p.8 Open in the tool Draw it: monopoly diagram

Q9OptionalEvaluate20 marks

Evaluate the likely impacts of monopsony power on employees and suppliers. Refer to a firm with monopsony power in your answer.

TopicThe labour market

Question paper p.16 Mark scheme p.18 Examiner report p.8 Open in the tool

Q10OptionalEvaluate20 marks

Evaluate the benefits of growth by takeover for a business in an industry of your choice. Illustrate your answer with an appropriate diagram(s).

TopicBusiness growth, mergers and market structure

Question paper p.16 Mark scheme p.21 Examiner report p.9 Open in the tool Draw it: cost curves diagram Or: monopoly diagram

Question text is quoted from the question papers, © Pearson Edexcel, for students’ private study. Open the official papers and mark schemes from the links on each question. Examiner insights are written with AI assistance and moderated by Finn.

Section A

Section B

The UK energy market

Section C

Other years of Edexcel International A-level Unit 3

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