Unit 3: Exploring Economic Behaviour · 1520U30-1
WJEC A-level Unit 3, June 2024
All 14 written questions from WJEC A-level Unit 3 (June 2024), Exploring Economic Behaviour. Each question shows its marks and topic, with an examiner insight on 5, and opens the question paper and mark scheme at the right page.
Section A
Q1(a)
Using a diagram and with reference to the data, outline the difference between internal economies of scale and internal diseconomies of scale.
Mark splitKnowledge 2Application 2
Q1(b)
Using a diagram, outline how Tesla might benefit from external economies of scale in Nevada.
Mark splitKnowledge 2Application 2
Q2(a)
On the diagram, indicate the level of output produced by this firm.
Mark splitApplication 1
Q2(b)
Shade the area that represents the firm's total variable costs of production.
Mark splitApplication 2
Q2(c)
Explain what will happen to this firm's level of output in the long run.
Mark splitKnowledge 1Application 1Analysis 2
Q3
Evaluate the view that Angola's privatisation programme is likely to be successful.
TopicCompetition policy and regulation
Examiner insight
- What to cover
- Argue both sides of the Angolan privatisation programme with chains of reasoning: efficiency gains from the profit motive and competition, revenue for the government, against the risk of private monopoly and the sale of assets below value.
- Evaluation
- Use the case study on why it may fail, for example underdeveloped financial markets and weak transparency. Close with a weighted judgement using it depends on.
- Watch out
- Naming the companies being privatised does not earn AO2 credit on its own. Use the substantive detail of the case.
- How it went in the exam
- The mean was 4.8 out of 8, the most accessible question on the paper, with 99.7 per cent attempting it. Most candidates did not give a weighted judgement, so top band AO4 was rare.
Q4
Analyse the likely impact of negative interest rates on aggregate demand in Sweden.
TopicMacroeconomic objectives and policyAggregate demand
Q5(a)
Using the data in Figure 2, calculate a price index for Germany in March 2023, taking March 2022 as the base period. You are advised to show your working.
Mark splitApplication 2Analysis 1
TopicMeasuring economic performanceInternational trade and exchange ratesMacroeconomic objectives and policy
Q5(b)
Assess whether Germany is likely to experience a wage-price spiral.
Mark splitApplication 2Analysis 2Evaluation 4
TopicMeasuring economic performanceInternational trade and exchange ratesMacroeconomic objectives and policy
Examiner insight
- What to cover
- Define the wage price spiral: higher prices lead to wage demands, higher wage costs raise prices again. Test it against the German data on inflation, wage settlements, union power and expectations, drawing on more than one figure.
- Diagram
- AD and AS with SRAS shifting left repeatedly, or a short run Phillips curve.
- Evaluation
- Argue both sides and give a weighted judgement, considering the strength of collective bargaining, whether inflation is imported and temporary, and how anchored inflation expectations are.
- Watch out
- This question is reversible, so a strong one sided answer can still reach Band 2 for AO4. But a two sided answer with a weighted judgement is what reaches the top band.
- How it went in the exam
- The mean for Q5 was 4.5 out of 11, the least accessible question on the paper, and a significant number did not attempt part (b).
Section B
Q6(a)
(i) Using the data in Table 1; calculate the percentage change in the dollar price of palm oil between 2019 and 2022. You are advised to show your working. (ii) 'The cedi depreciated sharply against the dollar in 2022 and, although it recovered a little towards the end of the year, it was still 50% weaker than in 2019', (lines 3-5). Using this information and your answer to (a)(i), calculate the percentage change in the cedi price of palm oil between 2019 and 2022. You are advised to show your working.
Q6(b)
With reference to the data and using a cost and revenue diagram, show how the weak cedi has resulted in higher prices, fewer sales and falling profits for firms in Ghana that import commodities.
Q7
Evaluate the extent to which Ghana's economic difficulties in 2022 were the result of external rather than internal factors.
Examiner insight
- What to cover
- Sort the causes of Ghana's 2022 difficulties into external (commodity and food prices, global interest rates and dollar strength, the war in Ukraine, the pandemic) and internal (government debt and deficits, revenue collection, governance, currency management). Use data tied to the end of 2022.
- Evaluation
- Weigh the two groups against each other and finish with a judgement on which mattered more.
- Watch out
- The question specifies 2022, so data from other dates does not answer it. A one sided answer cannot access both AO3 and AO4 marks.
- How it went in the exam
- The mean was 4.6 out of 8, the most accessible extended response on the paper.
Q8
Discuss whether the Ghanaian authorities should have intervened or not in the ways suggested in lines 17–22 to strengthen the cedi.
Examiner insight
- What to cover
- Take each of the two interventions named at lines 17 to 22 in turn, explain how it would support the cedi, and then argue against it. Do not cover only one of them.
- Diagram
- Foreign exchange market for the cedi, with demand rising or supply falling, and the effect on the rate.
- Evaluation
- Evaluate each solution rather than listing pros and cons for each, then give a weighted judgement on whether the authorities should have intervened at all.
- Watch out
- Theoretical answers on raising interest rates with no reference to the case earned little or no AO2 despite good analysis. Apply every point to Ghana.
- How it went in the exam
- The mean was 4.7 out of 10, the least accessible extended response in Section B. A high level evaluation of just one of the two routes could still reach 7 marks.
Q9
With reference to the case study, discuss whether living standards in Ghana are likely to be improved by Ghana's decision to go to the IMF for financial support.
TopicMeasuring economic performance
Examiner insight
- What to cover
- Keep living standards at the centre. Link the IMF package to the development indicators in the table: debt relief freeing spending on health and education, stabilisation of the cedi and inflation, restored access to finance.
- Evaluation
- Counter with the IMF conditions, austerity and subsidy removal hitting the poorest, Ghana's internal governance problems, and the fact that it has taken IMF support 16 times before. End with a weighted judgement in the form of whether living standards improve depends on.
- Watch out
- Describing the data on both sides is not analysis. Every argument must be tied to a living standards measure such as HDI or income, or it cannot reach the top band.
- How it went in the exam
- The mean was 6.3 out of 12. Timing was a problem: some candidates with strong earlier answers could not sustain the quality on this last question.
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.