Unit 3: Exploring Economic Behaviour · 1520U30-1
WJEC A-level Unit 3, June 2019
All 17 written questions from WJEC A-level Unit 3 (June 2019), Exploring Economic Behaviour. Each question shows its marks and topic, with an examiner insight on 3, and opens the question paper and mark scheme at the right page.
Section A
Q1
The diagram below shows a profit-maximising firm operating in monopolistic competition in the short-run. Explain, with the aid of a diagram, what will happen to the level of output produced by this firm in the long-run.
Mark splitApplication 2Analysis 2
TopicCosts, revenues and profitGrowth and development
Q2(a)
At what level of output does the firm earn normal profit? Justify your answer.
Mark splitApplication 2
Q2(b)
At what level of output does the firm maximise its revenue? Justify your answer.
Mark splitApplication 2
Q2(c)
State and explain one possible social or community objective that "Bowled Over" may choose to pursue.
Mark splitKnowledge 1Analysis 1
Q3(a)
Define the term 'interdependence'.
Mark splitKnowledge 1
TopicMarket structures
Q3(b)
Using the data and your own knowledge, explain two conditions under which price collusion is more likely to occur.
Mark splitKnowledge 2Application 1Analysis 2
TopicMarket structures
Q4(a)
Using Chart 1, compare and contrast the data on output gaps for the UK and the US.
Mark splitApplication 4
Q4(b)
With reference to all the information provided, assess the view that a negative output gap in an economy will always result in a fall in the rate of inflation.
Mark splitApplication 2Analysis 2Evaluation 3
TopicNational income and the circular flowMeasuring economic performance
Q5
With reference to the data, evaluate the likely relationship between a government's budget balance and its national debt.
Mark splitApplication 2Analysis 2Evaluation 3
TopicPublic finances and the role of the stateMacroeconomic objectives and policy
Q6
To what extent does the data provide evidence to support the quantity theory of money?
Mark splitKnowledge 1Application 1Analysis 2Evaluation 2
TopicMeasuring economic performanceMacroeconomic objectives and policy
Section B
Q7(a)
Using the data in paragraphs 1 and 2, calculate: The number of people employed in digital industries in the UK in 2016.
Mark splitApplication 2
Q7(b)
Using the data in paragraphs 1 and 2, calculate: The number of digital firms in London in 2015.
Mark splitApplication 2
Q7(c)
Using the data in paragraphs 1 and 2, calculate: The total size of the Welsh workforce.
Mark splitApplication 2
Q8
Using a cost and revenue diagram, evaluate the likely impact of ICT investment on a small firm's costs. (lines 10-14)
Mark splitKnowledge 2Application 2Analysis 2Evaluation 4
TopicAggregate demandBusiness growth and objectives
Examiner insight
- What to cover
- Answer about costs, not about the firm in general. ICT investment raises fixed costs in the short run but lowers variable costs per unit, improves productivity and can bring the firm down its average cost curve or shift AC down. Use the case study lines 10 to 14.
- Diagram
- Cost and revenue diagram with average cost shifting down, or the firm moving along LRAC to a lower point. Any justified and relevant cost and revenue diagram is accepted.
- Evaluation
- Weigh the upfront cost and financing for a small firm, training and disruption, whether the scale is large enough to recover the outlay, and how quickly the technology dates.
- Watch out
- Many candidates discussed the impact of ICT investment on a small firm rather than on its costs, and some had clearly not read the case study.
- How it went in the exam
- The mean was 5.4 out of 10, one of the more challenging questions on the paper, but examiners praised the creativity of the best answers.
Q9
Evaluate the likely impact of ICT investment on the Welsh labour market.
Mark splitKnowledge 2Application 2Analysis 2Evaluation 4
TopicAggregate demandThe labour market
Examiner insight
- What to cover
- Keep to the labour market. ICT raises labour productivity and the demand for skilled workers while substituting for routine jobs, so wages and employment move differently across skill groups in Wales. Use the case study data.
- Diagram
- Labour market diagrams for skilled and for routine labour, with demand shifting right for one and left for the other.
- Evaluation
- Consider occupational and geographical immobility in Wales, retraining and time lags, the risk of structural unemployment, and the size of the ICT sector relative to the Welsh economy.
- Watch out
- As in Q8, many wrote about the Welsh economy instead of the Welsh labour market. The data offered plenty to apply and AO2 marks are available on every question on this paper.
- How it went in the exam
- The mean was 6.6 out of 10, one of the better answered questions in Section B.
Q10(a)
With reference to the data, describe two possible indicators of development, other than the HDI, that could be used in response to the increasingly digital global economy.
Mark splitKnowledge 2Application 2
Q10(b)
With reference to the data, evaluate the view that the increasingly digital global economy will raise living standards in LEDCs.
Mark splitApplication 4Analysis 2Evaluation 4
TopicMeasuring economic performance
Examiner insight
- What to cover
- Link the specific examples in the case study to living standards in developing countries: mobile banking and financial inclusion, access to market prices for farmers, online education and health information, remote work and exports of services.
- Evaluation
- Weigh the digital divide and infrastructure gaps, the cost of data and devices, the skills needed to use them, the risk that gains go to urban elites, and whether higher income translates into wider living standards.
- Watch out
- Do not just repeat the examples from the case study. Each one needs your own analysis and a link to a living standards measure. Part (a) rewarded development indicators chosen in the light of the digital economy, not generic ones.
- How it went in the exam
- The mean for Q10 was 8.6 out of 14 and examiners said the quality was generally very high even though it was the last question on the paper.
Question text is quoted from the question papers, © WJEC CBAC Ltd, 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.