Unit 3: Business behaviour · WEC13/01

Edexcel International A-level Unit 3, October 2024

All 8 written questions and 6 multiple choice questions from Edexcel International A-level Unit 3 (October 2024), Business behaviour. Case studies: The pharmaceutical industry. 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 most likely outcome in the long-run?

AThe producer will make more supernormal profit
BThe producer's output will decrease but industry output will increase
CThe producer will leave the market
DThe market concentration will increase

Show the answer

The answer is B.

TopicRevenues, costs and profits

Question paper p.2 Mark scheme p.4 Examiner report p.3 Open in the tool

Q21 mark

Which one of the following best describes this pricing strategy?

AMarginal cost pricing
BLimit pricing
CPrice discrimination
DPredatory pricing

Show the answer

The answer is C.

TopicPrice discrimination and contestable markets

Question paper p.2 Mark scheme p.4 Examiner report p.3 Open in the tool

Q31 mark

Ceteris paribus, which one of the following is the most likely impact of the introduction of this maximum price for rice on producers?

AProducer surplus will increase
BFixed costs will decrease
CDynamic efficiency will increase
DAverage revenue will decrease

Show the answer

The answer is D.

TopicRevenues, costs and profits

Question paper p.2 Mark scheme p.4 Examiner report p.3 Open in the tool

Q41 mark

4 The table shows the total costs of a clothing manufacturer producing jeans at different levels of output. Total costs Output $ 0 40 000 10 000 60 000 20 000 100 000 30 000 160 000 40 000 240 000 What is the average fixed cost per unit if the firm produces 20 000 pairs of jeans?

Show the answer

The answer is A.

TopicRevenues, costs and profits

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

Q51 mark

Which one of the following is most likely to influence the elasticity of demand for agricultural labour?

AThe cost of capital required for farming relative to the cost of agricultural labour
BThe level of educational qualifications required to be an agricultural worker
CThe location of agricultural jobs in South Africa
DThe occupational and the geographical mobility of labour

Show the answer

The answer is A.

TopicThe labour market

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

Q61 mark

Which one of the following diagrams would illustrate Apple's total revenue curve? A B Revenue Revenue Output Output C D Revenue Revenue Output Output

Show the answer

The answer is D. Open the question paper to read the options.

TopicRevenues, costs and profits

Question paper p.4 Mark scheme p.5 Examiner report p.3 Open in the tool Practise the PED and revenue diagram

Section B

Case study

The pharmaceutical industry

Extracts: Figure 1: Largest pharmaceutical companies in Ireland, based on global revenue, · Figure 2: AstraZeneca's total global revenue and profit, $ million, 2021 and 2022 · Extract A: The pharmaceutical industry in Ireland · Extract B: AstraZeneca · Extract C: The global pharmaceutical industry · Figure 1: adapted from: https://www.hobsonprior.com/blog-post/2023-6/top-10-pharmaceutical-companies-in-ireland

In the extracts: European Union, Johnson, USA, AbbVie, Another, AstraZeneca's, Bayer, Dublin, Ireland's, Largest

Q7(a)Calculate2 marks

With reference to Figure 2, calculate the change in AstraZeneca's total costs between 2021 and 2022. You are advised to show your workings.

Mark splitApplication 2

TopicRevenues, costs and profits

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

Q7(b)Explain4 marks

With reference to Extract B line 14, explain the term 'dynamic efficiency'.

Mark splitKnowledge 2Application 2

TopicBusiness growth, mergers and market structure

Question paper p.6 Mark scheme p.7 Examiner report p.4 Open in the tool

Q7(c)Analyse6 marks

With reference to Extract A, analyse two ways that pharmaceutical companies may benefit from external economies of scale.

Mark splitKnowledge 2Application 2Analysis 2

TopicBusiness growth, mergers and market structure

Question paper p.6 Mark scheme p.8 Examiner report p.4 Open in the tool

Q7(d)Examine8 marks

With reference to the last paragraph of Extract B, examine the impact of the increase in fixed costs on AstraZeneca's profit. Illustrate your answer with an appropriate diagram(s).

Mark splitKnowledge 2Application 2Analysis 2Evaluation 2

TopicRevenues, costs and profits

Question paper p.6 Mark scheme p.9 Examiner report p.4 Open in the tool Draw it: cost curves diagram

Q7(e)Discuss14 marks

With reference to the information provided and your own knowledge, discuss the likely barriers that might prevent a new company from entering the pharmaceutical industry.

Mark splitEvaluation 6

TopicBusiness growth, mergers and market structure

Question paper p.6 Mark scheme p.11 Examiner report p.5 Open in the tool

Section C

Q8OptionalEvaluate20 marks

Evaluate the benefits of organic growth to a business such as Lidl. Illustrate your answer with an appropriate diagram(s).

TopicBusiness growth, mergers and market structure

Question paper p.16 Mark scheme p.13 Examiner report p.5 Open in the tool Draw it: cost curves diagram

Q9OptionalEvaluate20 marks

Evaluate the economic benefits of government intervention in labour markets. Illustrate your answer with an appropriate diagram(s).

TopicThe labour market

Question paper p.16 Mark scheme p.17 Examiner report p.5 Open in the tool

Q10OptionalEvaluate20 marks

Evaluate the benefits of collusion in a market of your choice. Illustrate your answer with a simple game theory model.

TopicOligopoly and monopolistic competition

Question paper p.16 Mark scheme p.20 Examiner report p.5 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 pharmaceutical industry

Section C

Other years of Edexcel International A-level Unit 3

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