OCR A-level Paper 3, June 2023

1. AA decrease in the level of income inequality
2. BA decrease in the rate of inflation
3. CAn increase in the current account deficit
4. DAn increase in unemployment

TopicMeasuring economic performanceInternational trade and exchange ratesPoverty and inequality

1. ACentral Bank is operating a fixed exchange rate. What intervention can it take to prevent the value of the currency falling? A Decreasing the interest rate
2. BImposing tariffs
3. CQuantitative easing
4. DSelling foreign currency reserves

TopicInternational trade and exchange ratesMacroeconomic objectives and policyThe financial sector

1. Afirm is producing Q1 units of output at a price of P1 in the diagram below. What objective is it likely to be pursuing? Costs and revenues MC AC P1 AR 0 Q1 Output MR A Profit maximisation
2. BProfit satisficing
3. CSales revenue maximisation
4. DSales volume maximisation

TopicCosts, revenues and profitBusiness growth and objectives

1. A601 units
2. B631 units
3. C642 units
4. D658 units

TopicDemand, supply and elasticity

1. AW
2. BW+X+Y+Z
3. CX+Y+Z
4. DX+Z

TopicInternational trade and exchange ratesThe economic problem and resource allocationMarket failure

1. AHouseholds are unable to afford the essentials needed for survival
2. BHousehold income is below 60% of median household income
3. CIndividuals are not incentivised to work because of the high level of welfare benefits
4. DIndividuals earn below the living wage

TopicPoverty and inequality

1. ATo produce goods and/or services
2. BTo regulate markets
3. CTo supply labour
4. DTo tax households

1. AThe ability to produce a good at a lower opportunity cost than another country
2. BThe ability to produce a good using fewer resources than another country
3. CThe ratio of export prices to import prices
4. DThe value of exports minus the value of imports

TopicInternational trade and exchange ratesThe economic problem and resource allocation

1. AConstruction of a new railway line
2. BFlood defence schemes
3. CNew hospital equipment
4. DUniversal credit

TopicPoverty and inequalityAggregate demandMacroeconomic objectives and policy

1. Afirm experiences a shift in its long run average cost curve from LRAC1 to LRAC2 in the diagram. What is the most likely cause of this? Costs + revenues LRAC1 LRAC2 0 Output A An increase in input prices resulting from new firms entering the market
2. BAn increase in the availability of skilled labour as a result of growth in the industry
3. CCoordination problems arising as a result of an increase in the scale of production
4. DGreater division of labour occurring as a result of the growth of the firm

TopicThe economic problem and resource allocationCosts, revenues and profit

1. AExternalities of consumption or production
2. BPolicy short-termism
3. CThe free rider problem
4. DThe principal-agent problem

TopicMarket failureAggregate demandGovernment intervention in markets

TopicMarket failurePoverty and inequality

1. ADecreases Increases
2. BIncreases Unchanged
3. CIncreases Increases
4. DUnchanged Increases

TopicThe labour market

1. Asmartphone manufacturer sees the demand for its phone rise in response to a decision to reduce its price below that of a competitor. How can this rise in demand be shown on a diagram? A A contraction along the demand curve
2. BAn extension along the demand curve
3. CThe demand curve shifting to the left
4. DThe demand curve shifting to the right

TopicDemand, supply and elasticity

1. A11.7%
2. B22.5%
3. C25.8%
4. D27.5%

TopicGovernment intervention in markets

1. AAllocative efficiency
2. BDynamic efficiency
3. CProductive efficiency
4. DX-efficiency

TopicMarket structuresCosts, revenues and profit

1. AAn increase in allocative efficiency
2. BAn increase in productive efficiency
3. CAn increase in the demand for capital goods
4. DAn increase in the opportunity cost of producing consumer goods

TopicThe economic problem and resource allocationMarket structuresDemand, supply and elasticity

1. AInflation is caused by increases in the money supply
2. BMoney avoids the need for a double co-incidence of wants
3. COutput will return to the full employment level of output in the long run
4. DThere is a trade-off between unemployment and inflation

TopicMeasuring economic performanceMacroeconomic objectives and policy

1. Afirm is deciding whether or not to increase output by one unit. What is this an example of? A Economies of scale
2. BOpportunity cost
3. CProfit maximisation
4. DThe marginal principle

TopicCosts, revenues and profitThe economic problem and resource allocation

1. AA decrease in the top rate of income tax
2. BA decrease in interest rates
3. CAn increase in consumer and business confidence
4. DAn increase in the value of the domestic currency

TopicMacroeconomic objectives and policyAggregate demandGovernment intervention in markets

1. ALong run economic growth
2. BNeither short run or long run economic growth
3. CShort run and long run economic growth
4. DShort run economic growth

TopicEconomic growth and the economic cycleMeasuring economic performanceAggregate supply

1. AAsymmetric information
2. BMoral hazard
3. CNegative externalities of consumption
4. DNegative externalities of production

TopicMarket failureAggregate demandThe financial sector

1. AFirms collude to agree on prices
2. BGoods and services are directly exchanged
3. CThe government intervenes in a commodity market to stabilise the price
4. DWorkers are assigned to particular stages of the production process

1. Agovernment managing an economy currently operating at point X in the diagram is considering pursuing demand-side economic growth. Which macroeconomic policy objective is this most likely to conflict with? Price AS1 level X AD1 0 Real GDP A Economic development
2. BFull employment
3. CMore even distribution of income
4. DSustainable balance of payments position

TopicMeasuring economic performanceEconomic growth and the economic cycleMacroeconomic objectives and policy

1. AClaimant Count
2. BClaimant Count and Labour Force Survey
3. CLabour Force Survey
4. DNeither Claimant Count or Labour Force Survey

TopicMeasuring economic performanceThe labour market

1. Afirm produces 85 units of output. The fixed costs associated with running the business total £4000 with an average variable cost of £3.20. If average variable cost is unchanged, what is the change in average total cost when the firm increases production to 86 units of output? A Decreases by £46.51
2. BDecreases by £0.55
3. CRemains the same
4. DIncreases by £3.20

TopicCosts, revenues and profit

1. AA conflict between macroeconomic policy objectives
2. BA satisfactory balance of payments position
3. CA symmetric inflation target
4. DAn asymmetric inflation target

TopicMeasuring economic performanceMacroeconomic objectives and policyThe financial sector

1. AA change in tastes and preferences
2. BAn increase in labour productivity
3. CAn increase in regulation
4. DA reduction in income tax

TopicGovernment intervention in marketsDemand, supply and elasticityThe labour market

1. AGovernment ownership and allocation of all resources
2. BInequality in the distribution of income and wealth
3. CProfit maximising behaviour results in monopoly firms exploiting consumers
4. DThe price mechanism fails to achieve allocative efficiency

TopicMarket structuresPoverty and inequalityDemand, supply and elasticity

1. ATo act as the banker to governments
2. BTo promote free trade
3. CTo provide finance for long-term development projects
4. DTo provide short-term financing for countries experiencing balance of payments problems

TopicInternational trade and exchange ratesMeasuring economic performance

TopicThe labour marketMarket failure

TopicEconomic growth and the economic cycle

TopicGovernment intervention in marketsInternational trade and exchange rates

TopicInternational trade and exchange rates

TopicGovernment intervention in marketsCompetition policy and regulation