Unit 3: Business behaviour · WEC13/01

Edexcel International A-level Unit 3, October 2022

All 8 written questions and 6 multiple choice questions from Edexcel International A-level Unit 3 (October 2022), Business behaviour. Case studies: The Indian mobile phone 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 also a barrier to entry for new firms?

APredatory pricing
BConstant returns to scale
CLow advertising costs
DHigh supernormal profits

Show the answer

The answer is A.

TopicRevenues, costs and profits

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

Q21 mark

Which one of the following can be deduced from the information provided?

AThe productively efficient level of output is being produced
BThe allocatively inefficient level of output is being produced
CThere would be an incentive for new firms to enter the market
DFirms will always make supernormal profits in this market

Show the answer

The answer is C.

TopicRevenues, costs and profits

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

Q31 mark

Which one of the following is most likely to have caused this fall in the supply of labour?

AAn increase in benefit payments
BAn increase in net migration
CAn increase in the wage rate
DAn increase in productivity

Show the answer

The answer is A.

TopicThe labour market

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

Q41 mark

4 A car manufacturer employs 40 engineers at a wage rate of $570 per week. To attract an additional worker, the car manufacturer must raise the wage rate for all engineers to $590 per week. What is the marginal cost of employing this additional worker?

A$20
B$820
C$1 390
D$24 190

Show the answer

The answer is C.

TopicRevenues, costs and profits

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

Q51 mark

Which one of the following would cause a firm to shut down in the short-run?

AAverage revenue is above its average total cost of production
BAverage revenue is below its average total cost of production
CAverage revenue is above its average variable cost of production
DAverage revenue is below its average variable cost of production

Show the answer

The answer is D.

TopicRevenues, costs and profits

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

Q61 mark

Which one of the following business objectives is shown by this pricing decision?

ARevenue maximisation
BSales volume maximisation
CProfit maximisation
DSatisficing

Show the answer

The answer is B.

TopicBusiness objectives

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

Section B

Case study

The Indian mobile phone market

Extracts: Figure 1: Market shares of mobile phone companies in India, 2020 and 2021 · Figure 2: Hourly labour cost for selected countries as a percentage of China's hourly · Extract A: The Indian smartphone market · Extract B: The production of smartphones in India · Extract C: Competition in the smartphone industry · Figure 1: https://odi.org/en/publications/asia-in-2025-development-prospects-and-challenges-for-middle-

In the extracts: Middle East, Samsung Electronics, South Korean, Vi Th, Indian, India's, FDI, OPPO, Africa, China's

Q7(a)Calculate2 marks

With reference to Figure 1, calculate the percentage point change in the four-firm concentration ratio between 2020 and 2021.

Mark splitApplication 2

TopicBusiness growth, mergers and market structure

Question paper p.7 Mark scheme p.6 Examiner report p.3 Open in the tool

Q7(b)Analyse6 marks

With reference to Extract A, analyse two reasons why India has become the world's second largest smartphone market.

Mark splitKnowledge 2Application 2Analysis 2

TopicBusiness growth, mergers and market structure

Question paper p.8 Mark scheme p.7 Examiner report p.5 Open in the tool

Q7(c)Explain4 marks

With reference to Extract B, explain what is meant by 'economies of scale'.

Mark splitKnowledge 2Application 2

TopicBusiness growth, mergers and market structure

Question paper p.10 Mark scheme p.8 Examiner report p.5 Open in the tool

Q7(d)Examine8 marks

With reference to Figure 2 and Extract B, examine the likely impact on the profits of Samsung of opening a smartphone factory in India. Use an appropriate diagram in your answer.

Mark splitKnowledge 2Application 2Analysis 2Evaluation 2

TopicBusiness growth, mergers and market structure

Question paper p.11 Mark scheme p.9 Examiner report p.6 Open in the tool Draw it: cost curves diagram

Q7(e)Discuss14 marks

With reference to Extract C, Figure 2 and your own knowledge, discuss the benefits of non-price competition for consumers and businesses in the Indian smartphone industry.

Mark splitEvaluation 6

TopicOligopoly and monopolistic competition

Question paper p.13 Mark scheme p.11 Examiner report p.4 Open in the tool

Section C

Q8OptionalEvaluate20 marks

Evaluate the possible benefits of a demerger. Illustrate your answer with an appropriate diagram(s).

TopicBusiness growth, mergers and market structure

Question paper p.16 Mark scheme p.14 Examiner report p.7 Open in the tool Draw it: cost curves diagram

Q9OptionalEvaluate20 marks

Evaluate the possible benefits of price discrimination to both the business and consumers. Illustrate your answer with an appropriate diagram(s).

TopicPrice discrimination and contestable markets

Question paper p.16 Mark scheme p.18 Examiner report p.7 Open in the tool Draw it: price discrimination diagram

Q10OptionalEvaluate20 marks

Evaluate the likely microeconomic effects of an increase in the national minimum wage on an industry of your choice. Illustrate your answer with an appropriate diagram(s).

TopicThe labour market

Question paper p.16 Mark scheme p.22 Examiner report p.8 Open in the tool

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 Indian mobile phone market

Section C

Other years of Edexcel International A-level Unit 3

Topics on this paper