AQA A-Level · Thinka 原創模擬試題

2022 AQA A-Level Economics 7136 模擬試題連答案詳解

Thinka Jun 2022 AQA A Level-Style Mock — Economics 7136

240 分360 分鐘2022

An original Thinka practice paper modelled on the structure and difficulty of the Jun 2022 AQA A Level Economics 7136 paper. Not affiliated with or reproduced from AQA.

卷一 - 甲部 (Data Response)

Choose EITHER Context 1 OR Context 2. Answer all questions within that context.

5 題目 · 42 分

題目 1 · calculation

2 分

### Table 1: Average market price of agricultural land per hectare in the UK (£), 2018 to 2023

| Year | Average Price per Hectare (£) |
|---|---|
| 2018 | 15,250 |
| 2019 | 15,900 |
| 2020 | 16,150 |
| 2021 | 17,200 |
| 2022 | 17,950 |
| 2023 | 18,485 |

Using the data in Table 1, calculate the index number for the average price of agricultural land in 2023, using 2018 as the base year. Give your answer to one decimal place.

查看答案詳解

解題

To calculate the index number for the average price of agricultural land in 2023, using 2018 as the base year:

1. **Identify the base year value (2018):** $£15,250$
2. **Identify the current year value (2023):** $£18,485$
3. **Apply the index number formula:**
\[ \text{Index Number} = \left( \frac{\text{Value in Current Year}}{\text{Value in Base Year}} \right) \times 100 \]
4. **Substitute the values into the formula:**
\[ \text{Index Number} = \left( \frac{18,485}{15,250} \right) \times 100 \]
\[ \text{Index Number} = 1.21213... \times 100 = 121.213... \]
5. **Round to one decimal place:**
$121.2$

評分準則

- **2 marks** for the correct answer of **121.2** (or **121** / **121.21**).
- **1 mark** for showing the correct calculation method but making an arithmetic error, e.g., $\left( \frac{18,485}{15,250} \right) \times 100$, or for omitting the multiplication by 100 (giving **1.2** or **1.21**).

題目 2 · calculation

2 分

題目 3 · Data Explanation

4 分

**Extract A: Air Quality and Public Health Indicators in Selected UK Regions (2023)**

| Region | Average annual $PM_{2.5}$ concentration ($\mu g/m^3$) | Annual respiratory hospital admissions (per 100,000 residents) |
| :--- | :---: | :---: |
| Region A | 12 | 140 |
| Region B | 18 | 210 |
| Region C | 25 | 330 |
| Region D | 31 | 420 |
| Region E | 42 | 590 |

Explain how the data in **Extract A** show that there is a positive relationship between air pollution and respiratory hospital admissions. (4 marks)

查看答案詳解

解題

To gain all 4 marks, a candidate needs to:

1. **Identify the relationship (1 mark):** State clearly that there is a positive relationship/correlation between the two variables (as the concentration of $PM_{2.5}$ particulate matter increases, the rate of respiratory hospital admissions also increases).
2. **Support with data (2 marks):** Reference at least two contrasting regions with full data points (concentration and admissions) to prove the positive relationship. For instance, comparing the lowest-pollution region (Region A: $12\ \mu g/m^3$ and 140 admissions) with the highest-pollution region (Region E: $42\ \mu g/m^3$ and 590 admissions).
3. **Provide economic context (1 mark):** Explain the economic significance of this link. The respiratory admissions represent an external cost (negative externality) of economic activities that generate air pollution (e.g., manufacturing or transport). This indicates a divergence between private and social costs, resulting in market failure.

評分準則

**Mark allocation:**

- **1 mark:** For identifying the positive relationship/correlation (as air pollution/$PM_{2.5}$ levels rise, respiratory admissions rise).
- **2 marks:** For supporting the identified relationship with appropriate data evidence from the table (must include data for at least two regions, representing both variables, e.g., Region A and Region E).
- **1 mark:** For explaining the economic significance of the data (e.g., identifying health costs/admissions as negative externalities/external costs of economic activity, leading to market failure).

題目 4 · Diagram and Analysis

9 分

### Context 1

**Figure 1: Use of disposable coffee cups**

In many developed economies, billions of disposable coffee cups are used and discarded annually, with less than 1% being successfully recycled. Most end up in landfill sites or as litter in the local environment.

**Question**

Explain, with the help of an appropriate diagram, how the consumption of single-use takeaway coffee cups leads to market failure, and how the introduction of an indirect tax on these cups can correct this market failure.

查看答案詳解

解題

### Diagram Description:
- **Y-axis**: Costs, Benefits, Price ($P$)
- **X-axis**: Quantity of single-use coffee cups ($Q$)
- **Curves**: Marginal Social Cost ($MSC = MPC$), Marginal Private Benefit ($MPB$), and Marginal Social Benefit ($MSB$).
- $MSB$ lies below $MPB$, with the vertical distance representing the Marginal External Cost ($MEC$).
- **Equilibriums**: Free market equilibrium at $Q_m$ (where $MPB = MPC$) and socially optimal equilibrium at $Q_{so}$ (where $MSB = MSC$).
- **Welfare Loss**: A shaded triangular area of deadweight loss pointing towards $Q_{so}$.
- **Tax Effect**: The indirect tax shifts the private cost curve upwards from $MPC$ to $MPC + \text{Tax}$. If the tax is set equal to the $MEC$ at $Q_{so}$, it leads to a new market equilibrium at the socially optimal quantity $Q_{so}$.

### Analytical Explanation:
1. **Market Failure**: Consuming single-use cups generates negative externalities of consumption (such as litter, environmental degradation, and cleanup costs borne by local governments). Because of these external costs, the Marginal Social Benefit ($MSB$) is lower than the Marginal Private Benefit ($MPB$) at all levels of consumption ($MSB = MPB - MEC$).
2. **Overconsumption**: In a free market, self-interested consumers and firms only consider their private benefits and costs (operating where $MPB = MPC$ at price $P_m$ and quantity $Q_m$). Because the external costs are ignored, there is overconsumption of $Q_m - Q_{so}$, leading to a deadweight welfare loss to society represented by the welfare loss triangle.
3. **How the Tax Corrects This**: The government can introduce an indirect tax on single-use cups. This increases the costs of supply, shifting the private cost curve upwards from $MPC$ to $MPC + \text{Tax}$.
4. **Internalising the Externality**: By raising the market price to $P_{so}$, the tax forces consumers to pay for the external costs they impose. This causes a contraction in demand along the $MPB$ curve, reducing the equilibrium quantity to $Q_{so}$. The negative externality is internalised, the deadweight welfare loss is eliminated, and resource allocation becomes allocatively efficient.

評分準則

**Level 3: 7–9 marks**
- A fully correct, clearly labelled diagram is drawn showing a negative externality in consumption ($MSB < MPB$) and the corrective shift of the private cost curve ($MPC$ to $MPC + \text{Tax}$).
- Clear, logical, and sustained economic chain of reasoning explaining why the free market overconsumes single-use cups and how the indirect tax adjusts market forces to align output with the social optimum.
- Consistent and accurate use of relevant economic terminology throughout.

**Level 2: 4–6 marks**
- A diagram is provided but may contain minor labelling errors or omissions (e.g., missing welfare loss or incorrect shifts).
- Explains either the market failure or the corrective tax reasonably well, but the chain of reasoning is incomplete or has minor logical gaps.
- Some appropriate economic terminology is used.

**Level 1: 1–3 marks**
- The diagram is severely flawed, inappropriate, or missing.
- The explanation is descriptive, brief, or contains significant economic inaccuracies regarding market failure or taxation.
- Minimal or incorrect use of economic terminology.

**Key Points to Accept / Look For:**
- Clear definitions of negative externalities of consumption.
- Explanation of "internalising the externality" (making the polluter pay).
- Correct identification of the welfare loss triangle pointing to the social optimum.

題目 5 · Evaluative Essay

25 分

Extract C suggests that the private rented housing market is failing to provide affordable, secure accommodation for many households. Using the extracts and your economic knowledge, evaluate the view that the government should introduce maximum rent controls in the UK private rented housing market.

查看答案詳解

解題

### Introduction
Define a maximum price (rent control) as a government-mandated price ceiling set below the free-market equilibrium rent. Outline the market failures in the UK rental housing market, such as extreme housing poverty, allocative inefficiency, and landlord monopoly power (especially in high-demand urban areas).

### Arguments in favour of maximum rent controls (Case for Intervention)
* **Equity and Affordability:** Rent controls directly lower housing costs for low-income tenants. This increases their real disposable income, reducing relative poverty and improving social welfare.
* **Consumer Surplus:** Transfers surplus from landlords to tenants, reducing exploitative pricing (addressing monopoly power where landlords face highly inelastic demand for housing).
* **Positive Externalities:** Stable, affordable housing promotes community cohesion, improves educational outcomes for children (due to fewer forced moves), and reduces the burden on public health services. This can be illustrated with a microeconomic diagram showing a maximum price set below equilibrium, reducing rent from $P_e$ to $P_{max}$.

### Arguments against maximum rent controls (Case against / Government Failure)
* **Shortage of Housing:** At the lower price $P_{max}$, quantity demanded increases from $Q_e$ to $Q_d$, while quantity supplied contracts from $Q_e$ to $Q_s$. This creates a chronic shortage of $Q_d - Q_s$.
* **Non-price Rationing & Black Markets:** Since demand exceeds supply, landlords may ration housing based on personal biases, or charge illegal under-the-counter payments ('key money') to bypass the cap.
* **Deterioration of Quality:** Landlords have less incentive to maintain, repair, or upgrade properties because their profit margins are squeezed and they face excess demand regardless of quality.
* **Disincentive to Build:** Long-term supply of new private rented housing may decline as developers shift resources to more profitable sectors, worsening the housing crisis.

### Alternative Policies
* **Supply-side Policies:** Building more social housing shifts the market supply curve to the right, lowering equilibrium rents naturally without causing shortages.
* **Housing Subsidies:** Direct income support (e.g., Housing Benefit) helps low-income tenants, though this may inflate market rents further if supply is highly inelastic.

### Evaluation and Conclusion
* **Time Horizon:** In the short run, supply is highly inelastic, meaning the shortage created by rent controls may be minimal. However, in the long run, supply is much more elastic, and the shortage will worsen significantly.
* **Severity of Cap:** The impact depends on how far below the equilibrium rent the cap is set.
* **Synthesis:** Rent controls act as a short-term emergency 'sticking plaster' but fail to address the underlying structural issue of housing undersupply. A more sustainable long-term solution involves state-funded housing construction and supply-side reforms to planning laws.

評分準則

### Level Descriptors (25 Marks total)

* **Level 5 (21–25 marks):** Strong, focused response showing robust, precise economic analysis. Demonstrates deep understanding of market mechanisms, market failure, and government failure. Excellent application to the context of rental housing. Evaluation is critical, balanced, and integrated throughout, leading to a logical and fully justified conclusion.
* **Level 4 (16–20 marks):** Clear economic analysis applied effectively to the context. Contains structured arguments for and against maximum rent controls. Evaluation is present and balanced, but the final judgment may lack some depth or fail to fully weigh up the counter-arguments.
* **Level 3 (11–15 marks):** Some relevant economic analysis and application. The response may focus heavily on description rather than analytical depth. Evaluation is present but may be superficial, one-sided, or added as an afterthought.
* **Level 2 (6–10 marks):** Descriptive answer with limited application of economic concepts. Contains analytical gaps or errors regarding maximum price controls. Very little or no evaluation.
* **Level 1 (1–5 marks):** Extremely weak or brief response. Shows substantial misunderstandings of basic economic theory, with no relevant analysis or evaluation.

### Assessment Objective Breakdown
* **AO1 (Knowledge & Understanding):** Correctly defines maximum prices and identifies relevant market failures (e.g., inequity, monopoly power).
* **AO2 (Application):** Applies concepts to the private rented housing market, referencing real-world dynamics like urban demand and the behavior of landlords.
* **AO3 (Analysis):** Uses economic theory and diagrams to analyze the outcomes of maximum prices (shortages, contraction of supply, expansion of demand).
* **AO4 (Evaluation):** Critically assesses the trade-offs of the policy, compares it with alternatives (supply-side policies), and draws a reasoned conclusion.

卷一 - 乙部 (Essays)

Choose ONE essay option from a choice of three. Each essay contains an analytical part and an evaluative part.

2 題目 · 40 分

題目 1 · Analytical Essay

15 分

Analyse how the growth of a monopsony employer in a local labour market is likely to affect the wage rate and employment level. Support your answer with a diagram.

查看答案詳解

解題

### Model Answer

**Introduction:**
* **Monopsony** is defined as a market structure with a single buyer. In a labour market context, a monopsonist is the sole employer of a particular type of labour in a given location or industry.
* In contrast, a **perfectly competitive labour market** consists of many firms and workers, where both parties are wage-takers, and equilibrium is reached where the supply of labour equals the demand for labour.

**Diagrammatic Representation:**
* An appropriate diagram should show:
1. The demand for labour, which is the Marginal Revenue Product of Labour curve ($D_L = MRP_L$).
2. The supply of labour, which represents the Average Cost of Labour ($S_L = AC_L$), showing an upward slope because to hire more workers, the firm must offer a higher wage.
3. The Marginal Cost of Labour ($MC_L$) curve, which lies above the $AC_L$ curve because the higher wage must be paid to all existing workers as well as the new recruit (assuming no wage discrimination).
4. The competitive outcome: where $S_L (AC_L) = MRP_L$, yielding wage $W_c$ and employment $E_c$.
5. The monopsonistic outcome: where the firm maximises surplus/profit at $MC_L = MRP_L$, hiring $E_m$ workers and paying a wage $W_m$ derived from the supply curve at that level of employment.

**Analysis of the Monopsony Outcome:**
* Because the monopsonist is the sole buyer, it faces the market supply curve. To expand employment, it must raise the wage rate for all employees. Consequently, $MC_L > AC_L$.
* To maximise profits, the employer hires labour up to the point where the cost of the last worker hired equals the revenue they generate: $MC_L = MRP_L$. This determines the employment level $E_m$.
* However, the monopsonist does not need to pay a wage equal to $MRP_L$ at this point. It only needs to pay the minimum wage necessary to attract $E_m$ workers, which is read off the supply curve ($AC_L$) at $W_m$.

**Comparison with Perfect Competition:**
* In a perfectly competitive labour market, equilibrium occurs where market supply equals market demand ($AC_L = MRP_L$), leading to wage $W_c$ and employment $E_c$.
* Comparing the two outcomes: $W_m < W_c$ and $E_m < E_c$.
* The growth of a monopsony employer therefore leads to **lower wages** and **lower employment** (under-employment). This results in "monopsonistic exploitation" of labour, as workers are paid less than their marginal revenue product ($W_m < MRP_L$ at $E_m$), and allocative inefficiency in the allocation of resources.

評分準則

**Marking Scheme (Levels of Response)**

* **Level 3 (11–15 Marks):**
* Consistently clear and precise definitions of monopsony and perfect competition.
* Accurately drawn diagram showing the relative positions of $MC_L$, $AC_L$, and $MRP_L$, clearly identifying the competitive ($W_c, E_c$) and monopsony ($W_m, E_m$) equilibria.
* Logical and well-structured chain of economic reasoning explaining why $MC_L$ lies above $AC_L$ and how the profit-maximising condition ($MC_L = MRP_L$) determines the lower wage and employment levels.

* **Level 2 (6–10 Marks):**
* Shows a reasonable understanding of monopsony and competitive labour markets.
* The diagram is present but may contain minor errors (e.g., mislabelling curves or failing to project the wage down to the supply curve from the intersection of $MC_L$ and $MRP_L$).
* Explains the general impacts on wages and employment, but the explanation of *why* $MC_L$ is steeper than $AC_L$ may be incomplete or lack depth.

* **Level 1 (1–5 Marks):**
* Shows limited or confused understanding of monopsony.
* The diagram is missing, incorrect, or not integrated into the analysis.
* Asserts that wages and employment will fall without providing a coherent theoretical explanation.

題目 2 · Evaluative Essay

25 分

In highly concentrated oligopolistic markets, firms often seek to merge to exploit economies of scale and increase market share.

Evaluate the view that a merger between two major firms in an oligopolistic market will always result in a net welfare loss for consumers.

查看答案詳解

解題

### Analytical & Evaluative Breakdown

#### 1. Introduction
* **Definitions**: Define key terms, including *oligopoly* (a market structure dominated by a few large firms with high concentration ratios and mutual interdependence), *merger* (the joining of two previously separate firms into a single entity), and *consumer welfare* (typically measured by consumer surplus, price levels, quality of products, and choices available).
* **Context**: Explain that a merger between two major firms in an oligopoly (e.g., a horizontal merger) will increase the concentration ratio (e.g., the 3-firm or 5-firm CR) and reduce the number of active competitors.

#### 2. Arguments Supporting the View (Welfare Loss is Likely)
* **Increased Market Power & Price Making Ability**: Post-merger, the new entity possesses greater market share and market power. This allows the firm to restrict output and raise prices to maximise profits, leading to a loss of allocative efficiency where price exceeds marginal cost ($P > MC$).
* **Collusion**: With fewer dominant players in the market, the likelihood of tacit or explicit collusion increases. Oligopolists can more easily coordinate pricing or output decisions, to the detriment of consumers.
* **Loss of Consumer Choice and Quality**: Reduced competition removes the incentive for firms to compete on non-price factors, potentially leading to poorer customer service and a narrower range of products.
* **X-Inefficiency**: The lack of competitive pressure may cause organizational slack, meaning the merged firm operates above its lowest possible average cost curve ($ATC$).
* **Diagrammatic Analysis**: A monopoly/market power diagram can be used to show the transition from a more competitive market state to a monopoly-like state, demonstrating the reduction in consumer surplus and the creation of deadweight loss (welfare loss).

#### 3. Arguments Countering the View (Potential Welfare Gains)
* **Economies of Scale**: The merged firm can exploit substantial economies of scale (e.g., technical, managerial, purchasing, or financial). This shifts the average cost curve downwards (from $ATC_1$ to $ATC_2$). If these cost savings are significant, the profit-maximising price of the merged firm (even with a higher markup) could actually be lower than the pre-merger price (the Williamson Welfare Trade-off model).
* **Dynamic Efficiency**: Increased supernormal profits can be reinvested into Research & Development (R&D). This can lead to technological breakthroughs, process innovations, and higher-quality products, which enhance consumer welfare over the long run.
* **Elimination of Duplicated Costs**: In network or infrastructure-heavy oligopolies (like telecommunications or energy), merging can eliminate wasteful duplication of infrastructure, lowering industry-wide costs.
* **Synergy and Complementary Strengths**: The two firms may possess complementary technologies or patents, leading to superior product integration.

#### 4. Critical Evaluative Factors (Why it is NOT "Always" a Loss)
* **The Role of Competition Authorities**: In the UK, the Competition and Markets Authority (CMA) investigates mergers that substantially lessen competition. They can block the merger or permit it only on the condition that certain assets are divested (remedies), protecting consumer interest.
* **Contestability**: If the market has low barriers to entry and exit (highly contestable), the merged firm cannot abuse its market power because the threat of hit-and-run entry will force it to keep prices close to average cost.
* **Type of Merger**: A vertical merger (integrating different stages of production) might lead to efficiency gains (elimination of double marginalisation) without reducing direct retail competition as much as a horizontal merger.
* **The State of the Firms Pre-merger**: If one firm was failing (the 'failing firm defence'), a merger might be the only way to keep its assets and capacity in the market, preventing a worse outcome for consumers.

評分準則

### Marking Scheme (25 Marks)

| Level | Marks | Description |
| :---: | :---: | :--- |
| **Level 5** | **21–25** | **Strong, focused, and balanced economic analysis and evaluation.**
- Clear, precise definitions and sophisticated use of terminology.
- Well-integrated and accurate diagrams (e.g., monopoly power, economies of scale, or Williamson trade-off).
- Systematic evaluation of both sides with a logical, reasoned conclusion that addresses the 'always' aspect of the prompt directly.
- Excellent structure and flow throughout. |
| **Level 4** | **16–20** | **Good analysis and evaluation, but lacks full precision.**
- Good application of economic concepts and relevant diagrams.
- Offers balanced arguments on both welfare losses (market power) and gains (economies of scale).
- Evaluative comments are present and supported, leading to a reasonable conclusion, though may lack the nuance of Level 5. |
| **Level 3** | **11–15** | **Reasonable analysis with limited or superficial evaluation.**
- Explains why mergers lead to market power or economies of scale but development of steps is uneven.
- Diagrams may be present but contain minor errors or are not fully integrated into the text.
- Evaluation is descriptive, generic, or tacked on at the end without deep integration. |
| **Level 2** | **6–10** | **Limited economic analysis and weak/no evaluation.**
- Demonstrates basic understanding of what a merger or oligopoly is.
- Lacks rigorous economic explanation of welfare impacts.
- No significant attempt at evaluation; highly one-sided. |
| **Level 1** | **1–5** | **Very weak, fragmented, or mostly irrelevant response.**
- Minimal or incorrect understanding of oligopolies and mergers.
- Lacks diagrams, economic structure, and coherent arguments. |

**Key Points to Reward**:
* Use of concentration ratios ($CR$) to explain market structure.
* Distinction between allocative, productive, and dynamic efficiency.
* Use of the Williamson Welfare Trade-off model.
* Real-world examples (e.g., supermarket mergers like Sainsbury's/Asda, mobile network mergers like Three/Vodafone) to support the analysis.

卷二 - 甲部 (Data Response)

Choose EITHER Context 1 OR Context 2. Answer all questions within that context.

4 題目 · 40 分

題目 1 · Calculation

2 分

Table 1 shows the nominal GDP and the GDP deflator for an economy in 2021 and 2022.

| Year | Nominal GDP ($bn) | GDP Deflator (2021 = 100) |
|---|---|---|
| 2021 | 850 | 100 |
| 2022 | 918 | 105 |

Using the data in Table 1, calculate the index of real GDP in 2022, to one decimal place.

查看答案詳解

解題

To calculate the index of real GDP in 2022, we first determine the real GDP for both years.

**Step 1: Calculate Real GDP for 2021 and 2022**
* Real GDP 2021 (Base Year) = $850bn (since the GDP deflator is 100).
* Real GDP 2022 = $\frac{\text{Nominal GDP}}{\text{GDP Deflator}} \times 100 = \frac{918}{105} \times 100 = \$874.2857\text{bn}$.

**Step 2: Calculate the Index of Real GDP for 2022**
* Index of Real GDP 2022 (with 2021 as the base year of 100) = $\frac{\text{Real GDP 2022}}{\text{Real GDP 2021}} \times 100 = \frac{874.2857}{850} \times 100 = 102.857...$

**Step 3: Round to one decimal place**
* Rounding 102.857... to one decimal place gives **102.9**.

*Alternative Method using Index Numbers:*
* Nominal GDP Index 2022 = $\frac{918}{850} \times 100 = 108.0$
* Real GDP Index 2022 = $\frac{\text{Nominal GDP Index}}{\text{GDP Deflator}} \times 100 = \frac{108}{105} \times 100 = 102.857... \approx 102.9$

評分準則

* **2 marks** for the correct answer of **102.9** (also accept **102.86** or **103** if rounded differently).
* **1 mark** for correct calculation of Real GDP in 2022 ($874.29bn) or for showing the correct formula/working but making an arithmetic error (e.g. $\frac{874.29}{850} \times 100$).

題目 2 · Data Explanation

4 分

Extract B: Index of Export and Import Prices for Zephyrus (2019 = 100). In 2019, Export Price Index was 100.0 and Import Price Index was 100.0. In 2023, Export Price Index was 110.0 and Import Price Index was 125.0. Explain how the data in Extract B show that Zephyrus experienced a deterioration in its terms of trade between 2019 and 2023.

查看答案詳解

解題

To find the terms of trade (ToT), we use the formula: ToT = (Index of Export Prices / Index of Import Prices) * 100. For 2019: (100.0 / 100.0) * 100 = 100.0. For 2023: (110.0 / 125.0) * 100 = 88.0. The ToT index decreased from 100 to 88 (a fall of 12%). This deterioration means that a given volume of exports can buy fewer imports than before, as import prices rose by 25% while export prices only rose by 10%.

評分準則

For identifying the change in the terms of trade with supporting calculation (up to 2 marks): 1 mark for calculating the 2023 terms of trade index as 88.0 (or identifying a 12% deterioration). 1 mark for identifying that import prices rose faster (by 25%) than export prices (by 10%). For explaining the economic meaning of the deterioration (up to 2 marks): 1 mark for defining terms of trade or explaining the formula. 1 mark for explaining that a deterioration means the country must export more to purchase the same quantity of imports (or that the purchasing power of its exports has decreased).

題目 3 · Diagram and Analysis

9 分

Extract C suggests that rising global trade protectionism has led to retaliatory tariffs being imposed on UK exports. With the help of an AD/AS diagram, explain how the imposition of tariffs on a country's exports by its trading partners is likely to affect its price level and real national output.

查看答案詳解

解題

### Diagrammatic Representation
* **Axes:** The vertical axis should be labelled 'Price Level' (PL) and the horizontal axis 'Real National Output' (Y).
* **Initial Equilibrium:** Show an initial downward-sloping Aggregate Demand curve ($AD_1$) intersecting an upward-sloping Short-Run Aggregate Supply curve ($SRAS$) at price level $PL_1$ and output level $Y_1$.
* **Shift:** Show a leftward shift of the Aggregate Demand curve to $AD_2$.
* **Final Equilibrium:** Show the new intersection at a lower price level $PL_2$ and a lower level of real national output $Y_2$.

### Economic Analysis
1. **Definition/Context:** Tariffs are taxes placed on imported goods. When foreign trading partners impose retaliatory tariffs on a country's exports, the price of these exports rises for foreign consumers.
2. **Impact on Components of AD:** Assuming demand for exports is price elastic, the increase in price leads to a more-than-proportionate fall in the quantity demanded. This causes export revenue ($X$) to decline. Since net exports ($X-M$) is a key component of Aggregate Demand ($AD = C + I + G + (X - M)$), a decline in net exports leads to a leftward shift in the AD curve.
3. **Impact on Macroeconomic Indicators:**
* **Real National Output:** The reduction in demand forces domestic exporting firms to cut production. This leads to a decline in real national output from $Y_1$ to $Y_2$, widening the negative output gap and potentially increasing cyclical unemployment.
* **Price Level:** The fall in aggregate demand reduces demand-pull inflationary pressures in the economy, causing the price level to decrease from $PL_1$ to $PL_2$ (disinflation).

評分準則

### Level Descriptor Grid (9 Marks Total)

* **Level 3 (7-9 Marks):**
* **Diagram:** A clear, fully labelled, and accurate AD/AS diagram is drawn showing a leftward shift in AD and the subsequent impact on price level and real national output.
* **Analysis:** The economic explanation of the transmission mechanism (tariffs $\rightarrow$ higher export prices $\rightarrow$ lower export demand/revenue $\rightarrow$ lower net exports $\rightarrow$ leftward shift in AD $\rightarrow$ impact on output and price level) is precise, logical, and fully developed, making good use of relevant economic terminology.

* **Level 2 (4-6 Marks):**
* **Diagram:** A diagram is present but may have minor labelling errors or omissions (e.g., axes not fully labelled), or the shift is incorrectly drawn.
* **Analysis:** The explanation of how export tariffs affect the domestic economy is reasonable but contains gaps in the chain of reasoning (e.g., failing to link lower export revenue clearly to AD) or lacks depth in analyzing both price level and output.

* **Level 1 (1-3 Marks):**
* **Diagram:** The diagram is largely incorrect, missing, or irrelevant.
* **Analysis:** The explanation shows very limited understanding, offering only brief or superficial points about tariffs or AD with little to no logical structure.

### Breakdown of Marks within levels:
* **Diagram (Max 4 Marks):**
* 1 mark for correctly labelled axes (Price Level and Real National Output/GDP) and original curves ($AD_1$ and $SRAS$).
* 1 mark for showing initial equilibrium ($PL_1$ and $Y_1$).
* 1 mark for showing a leftward shift of the AD curve ($AD_2$).
* 1 mark for showing the new equilibrium with lower price level and real output ($PL_2$ and $Y_2$).
* **Analysis (Max 5 Marks):**
* Up to 5 marks for explaining the economic transmission mechanism clearly, defining key terms, and linking the microeconomic impact of foreign tariffs to the macroeconomic consequences on the domestic economy's output and inflation rate.

題目 4 · Evaluative Essay

25 分

Extract C highlights that 'the global economy is experiencing a resurgence of economic nationalism, with nations increasingly adopting tariffs and other trade barriers.'

Using the data and your economic knowledge, evaluate the view that a shift towards trade protectionism by a major developed country will inevitably lead to a worsening of its macroeconomic performance.

查看答案詳解

解題

### Introduction
- **Definition of Protectionism:** The use of trade barriers such as tariffs, quotas, subsidies, and administrative regulations to protect domestic industries from foreign competition.
- **Macroeconomic Performance Indicators:** Real GDP growth, inflation, unemployment, balance of payments (current account), and fiscal balance.
- **Thesis:** While protectionism can offer short-run concentrated benefits to specific domestic sectors (e.g., job preservation, national security), in a highly integrated global economy, it is highly likely to lead to a net worsening of macroeconomic performance due to retaliation, cost-push inflation, and productive inefficiencies.

### Arguments that Protectionism Will Worsen Macroeconomic Performance
1. **Higher Cost-Push Inflation and Cost of Production:**
- Many modern manufacturing processes rely on global value chains. Tariffs on intermediate goods (e.g., steel, semiconductors) increase production costs for domestic manufacturers.
- Consumers face higher prices for imported finished goods, reducing real household incomes and consumer spending $ (C) $.
2. **Retaliation and Deterioration of the Current Account:**
- Trade partners are highly likely to retaliate with their own tariffs. This leads to a fall in export demand $ (X) $.
- While imports $ (M) $ may fall, the fall in $ X $ can offset this, potentially worsening the current account deficit rather than improving it.
- The contraction in net exports $ (X - M) $ shifts Aggregate Demand (AD) to the left, reducing economic growth.
3. **Loss of Productive and Allocative Efficiency:**
- Shielding domestic firms from foreign competition reduces the incentive to innovate, adopt new technologies, or minimize costs, leading to X-inefficiency.
- Resources are misallocated to less competitive industries where the nation lacks a comparative advantage, reducing the economy's Long-Run Aggregate Supply (LRAS).

### Arguments that Protectionism May Improve (or Not Worsen) Macroeconomic Performance
1. **Protection of Infant and Strategic Industries:**
- Protection allows new industries to establish economies of scale, eventually leading to structural diversification and higher long-run economic growth.
- Protection of strategic industries (e.g., defence, green technology) ensures economic resilience.
2. **Preservation of Domestic Employment:**
- Shielding domestic sectors from foreign 'dumping' or low-wage competition prevents structural unemployment and regional decline, supporting consumption and tax revenue.
3. **Improvement in the Terms of Trade and Fiscal Balance:**
- A large country imposing tariffs can improve its terms of trade by forcing foreign exporters to lower their prices to maintain market share.
- Tariff revenues directly improve the government's fiscal position, which can be reinvested into supply-side infrastructure.

### Evaluation and Synthesis
- **Inevitability:** The term 'inevitably' is too strong. The outcome depends on key factors:
- **Retaliation:** If trading partners retaliate aggressively, the net effect on GDP and employment is almost certainly negative.
- **Elasticities:** If the demand for imports is highly price inelastic (e.g., essential raw materials), tariffs will not reduce import volumes but will significantly fuel domestic inflation.
- **Short-run vs. Long-run:** In the short run, protectionism might boost specific sectors and protect jobs. In the long run, it leads to deadweight loss, inefficiency, and lower potential output.
- **Alternative Policies:** Supply-side policies (e.g., education, infrastructure investment) are generally more effective at improving international competitiveness without the distortionary effects of protectionism.

評分準則

### Level Descriptor Mark Scheme (25 Marks)

| Level | Marks | Descriptor |
|---|---|---|
| **Level 4** | **21–25** | • Good analysis of the impact of protectionism on multiple macroeconomic objectives, supported by relevant economic theory (e.g., AD/AS, comparative advantage).
• Good application of data and context.
• Clear, well-structured evaluation that directly addresses the concept of 'inevitability'.
• Well-justified, balanced conclusion. |
| **Level 3** | **16–20** | • Analytical points are developed, showing both positive and negative consequences of protectionism.
• Explores the impact on macroeconomic indicators such as inflation, growth, and the balance of payments.
• Some evaluative comments, but they may lack depth or not be fully integrated into a coherent conclusion. |
| **Level 2** | **9–15** | • Descriptive explanation of protectionist tools (e.g., tariffs) with some connection to macroeconomic performance.
• Limited or one-sided analysis (focusing only on benefits or only on costs).
• Weak or superficial evaluation. |
| **Level 1** | **1–8** | • Fragmented knowledge of tariffs or protectionism.
• Lacks clear economic analysis or application to the macroeconomic performance of a developed nation.
• No meaningful evaluation. |

**Key Points for Markers:**
- **For maximum marks (Level 4):** Students must balance the negative impacts (cost-push inflation, retaliation, productive inefficiency) against the arguments in favor of protectionism (infant industry argument, employment protection). They must explicitly evaluate the word *'inevitably'* and provide a reasoned conclusion on the overall net impact on macroeconomic performance.

卷二 - 乙部 (Essays)

Choose ONE essay option from a choice of three. Each essay contains an analytical part and an evaluative part.

2 題目 · 40 分

題目 1 · Analytical Essay

15 分

Explain how a significant, sustained depreciation in a country's exchange rate might help to reduce a deficit on the current account of its balance of payments, but could conflict with other macroeconomic policy objectives.

查看答案詳解

解題

A depreciation of a currency means its value falls relative to other currencies.

**1. Reducing the Current Account Deficit:**
- When a currency depreciates, exports become cheaper in terms of foreign currencies, increasing the competitiveness of domestic goods abroad. Consequently, the volume of exports increases.
- Conversely, imports become more expensive in terms of the domestic currency, which disincentivises domestic consumers from buying foreign goods. This leads to a fall in the volume of imports.
- According to the **Marshall-Lerner condition**, a depreciation will improve the current account balance provided that the sum of the price elasticities of demand for exports and imports is greater than one: $ PED_x + PED_m > 1 $.
- In the short run, the current account may worsen before it improves due to inelastic demand (consumers and firms take time to adjust contracts), a phenomenon known as the **J-curve effect**.

**2. Conflicts with Other Macroeconomic Policy Objectives:**
- **Price Stability (Inflation):** A weaker currency increases the domestic price of imported raw materials and finished goods, causing **cost-push inflation**. Additionally, the rise in net exports increases aggregate demand (AD), which can lead to **demand-pull inflation** if the economy is operating close to full capacity.
- **Economic Growth and Living Standards:** While higher net exports stimulate economic growth, the resulting inflation can erode real wages, reducing consumer purchasing power and household living standards.
- **Monetary Policy Conflict:** To curb the inflationary pressures arising from currency depreciation, the central bank may need to raise interest rates, which could stifle domestic investment and slow down wider economic activity.

評分準則

**Marking Scheme (Level of Response):**

* **Level 3 (11-15 Marks):**
- Clear, logical, and detailed explanation of how a currency depreciation improves the current account.
- Correct application of relevant economic theories (e.g., Marshall-Lerner condition, J-curve effect, and export/import price changes).
- Well-developed analysis of how this depreciation conflicts with at least two other macroeconomic objectives (e.g., price stability, real income growth).
- Strong use of economic terminology.

* **Level 2 (6-10 Marks):**
- Explains the mechanism of how depreciation reduces a current account deficit, but may omit theoretical concepts like the Marshall-Lerner condition or J-curve.
- Explains at least one policy conflict (e.g., inflation) but the analysis lacks depth or completeness.
- Some use of economic terminology.

* **Level 1 (1-5 Marks):**
- Superficial understanding of depreciation and the current account.
- Fails to explain the link or conflicts clearly, relying on simple assertions.
- Limited or incorrect use of economic terminology.

**Accept/Reject Notes:**
- **Accept:** Explanations focusing on both demand-pull and cost-push inflation as valid conflicts.
- **Reject:** Analyses that assume depreciation immediately improves the current account without discussing the role of elasticities or the short-run vs. long-run outcomes.

題目 2 · Evaluative Essay

25 分

Evaluate the view that a policy of protectionism is the most effective way for a government to reduce a persistent current account deficit on the balance of payments.

查看答案詳解

解題

### Introduction: A current account deficit occurs when the value of goods and services imported, along with net primary and secondary income outflows, exceeds the value of exports and inflows. Protectionism refers to government policies, such as tariffs, quotas, and subsidies, designed to restrict international trade and shield domestic industries from foreign competition. ### Arguments for Protectionism: Protectionist measures, such as a tariff, raise the price of imported goods, making domestic alternatives relatively more attractive. This is known as an 'expenditure-switching' policy. If domestic consumers switch to home-produced goods, the volume of imports falls, directly improving the balance of trade in goods and services. Under the Marshall-Lerner condition, if the sum of the price elasticities of demand for exports and imports is greater than one $ (PED_x + PED_m > 1) $, this reduction in imports will successfully narrow the current account deficit. Additionally, protecting 'infant industries' can allow domestic firms to achieve economies of scale, eventually making them competitive exporters, which further aids the trade balance in the long run. ### Arguments against Protectionism: Firstly, protectionism invites retaliation. If a country imposes tariffs, trading partners are likely to respond with their own tariffs, reducing the country's exports and neutralizing any improvement in the current account. Secondly, tariffs on imported raw materials or intermediate components raise production costs for domestic manufacturers, reducing their export competitiveness. Thirdly, protectionism acts as a barrier to competition, which can lead to domestic productive inefficiency, higher prices, and lower quality products, further damaging international competitiveness. Finally, such measures violate World Trade Organization (WTO) rules and can lead to formal trade disputes. ### Alternative Policies: 1. Supply-side policies: Improving education, training, infrastructure, and encouraging research and development (R&D) can raise productivity and lower unit labour costs. This enhances the structural competitiveness of exports, offering a long-term, sustainable solution to a persistent deficit. 2. Expenditure-reducing policies: Contractionary fiscal policy (higher taxes, lower government spending) or contractionary monetary policy (higher interest rates) reduces aggregate demand and disposable incomes. This lowers consumer spending on imports, directly improving the trade balance, though at the cost of lower economic growth and higher unemployment. 3. Exchange rate policy: A depreciation of the currency (either through market forces or monetary intervention) makes exports cheaper and imports more expensive, correcting the deficit over time, subject to the J-curve effect. ### Conclusion and Evaluation: While protectionism can offer a rapid, short-term reduction in import volumes, it is rarely the most effective policy for a persistent current account deficit. A persistent deficit is usually structural, reflecting low productivity, poor innovation, or high inflation relative to trading partners. Protectionism fails to address these supply-side weaknesses and risks damaging retaliation. Therefore, supply-side policies are the most effective long-term solution, although they require significant time and opportunity cost. For immediate, non-retaliatory adjustment, expenditure-reducing policies may be used, but the optimal approach is a policy mix that addresses both short-term demand and long-term structural supply.

評分準則

### Level 5 (21-25 marks): Strong focus on the question throughout. Demonstrates precise and comprehensive understanding of protectionism, current account deficits, and alternative policies. Excellent analysis of transmission mechanisms (e.g., J-curve, Marshall-Lerner, expenditure-switching vs expenditure-reducing). Evaluation is balanced, critical, and leads to a well-supported, nuanced conclusion. ### Level 4 (16-20 marks): Good analysis of how protectionism reduces a deficit alongside at least one alternative policy. Shows clear understanding of economic concepts. Some evaluation is present, though it may lack the depth or integration seen in Level 5. ### Level 3 (11-15 marks): Reasonable understanding of protectionism and the current account. Analysis is present but may contain minor gaps or be descriptive in parts. Limited evaluation that may be superficial or added as an afterthought. ### Level 2 (6-10 marks): Basic understanding of tariffs/imports. Explanations are largely descriptive with weak economic analysis. Minimal or no evaluation. ### Level 1 (1-5 marks): Very limited or incorrect understanding. Major errors in defining key terms or mechanisms. No evaluation.

Paper 3 - 甲部 (選擇題)

Answer all 30 multiple choice questions.

30 題目 · 30 分

題目 1 · 選擇題

1 分

A government decides to introduce a tradeable pollution permit scheme for carbon emissions. Which of the following is most likely to lead to a failure of this scheme to reduce emissions?

A.The government sets the initial cap on emissions too high.
B.Firms invest in green technology to reduce their need for permits.
C.The price of pollution permits rises significantly in the secondary market.
D.The government reduces the total number of permits available over time.

查看答案詳解

解題

A tradeable permit scheme relies on a binding cap on emissions to create a scarcity price. If the initial cap is set too high (i.e., above current emissions levels), permits will be abundant, their price will fall to zero or near zero, and firms will have no financial incentive to reduce emissions, leading to scheme failure.

評分準則

1 mark for the correct answer (a). Reject other options because they either increase the effectiveness of the scheme (b, d) or reflect a functioning market with a high price incentive to cut emissions (c).

題目 2 · 選擇題

1 分

Country X has a comparative advantage over Country Y in the production of wheat if:

A.Country X can produce wheat with fewer resources than Country Y.
B.the opportunity cost of producing wheat in Country X is lower than in Country Y.
C.Country X has a larger absolute level of wheat production than Country Y.
D.Country X can produce wheat at a lower nominal price than Country Y.

查看答案詳解

解題

Comparative advantage is defined strictly in terms of opportunity cost. A country has a comparative advantage in producing a good if the opportunity cost of producing that good (the foregone production of another good) is lower than in another country. Option a describes absolute advantage.

評分準則

1 mark for the correct answer (b). Option a defines absolute advantage. Options c and d do not define comparative advantage.

題目 3 · 選擇題

1 分

A firm in a monopolistically competitive market is operating in long-run equilibrium. Which of the following features describes its position?

A.It achieves allocative efficiency because Price equals Marginal Cost.
B.It achieves productive efficiency because it operates at the minimum point of its Average Total Cost curve.
C.It makes supernormal profits because barriers to entry are high.
D.It exhibits excess capacity because the profit-maximising level of output is less than the productively efficient level.

查看答案詳解

解題

In monopolistic competition long-run equilibrium, firms make normal profits because of freedom of entry. However, because they face a downward-sloping demand curve, the tangent point with the Average Total Cost (ATC) curve occurs to the left of the minimum ATC. Hence, they do not achieve productive efficiency, exhibiting excess capacity. They also do not achieve allocative efficiency as Price is greater than Marginal Cost.

評分準則

1 mark for the correct option (d). Reject a and b because a monopolistically competitive firm is neither allocatively nor productively efficient in the long run. Reject c because they only earn normal profits in the long run.

題目 4 · 選擇題

1 分

A monopsonist employer faces a typical upward-sloping supply curve of labour. Which of the following statements is correct regarding the monopsonist's hiring decision?

A.The marginal cost of labour is equal to the average cost of labour.
B.The monopsonist will hire labour up to the point where the marginal revenue product of labour equals the marginal cost of labour, and pay a wage equal to the marginal cost of labour.
C.The marginal cost of labour is greater than the average cost of labour because to hire an additional worker, the firm must pay a higher wage to all existing workers.
D.The wage rate paid is equal to the marginal revenue product of labour.

查看答案詳解

解題

Because a monopsonist is the sole buyer of labour, to hire more workers it must raise the wage rate (as the supply curve is upward-sloping). Under the assumption of uniform wages, it must pay this higher wage to all existing workers as well. Thus, the Marginal Cost of Labour (MCl) lies above the Average Cost of Labour (ACl or supply of labour).

評分準則

1 mark for correct option (c). Option a is incorrect because MCl is greater than ACl. Option b is incorrect because the wage paid is off the supply curve, which is lower than MCl. Option d is incorrect because wage is less than the Marginal Revenue Product of labour.

題目 5 · 選擇題

1 分

Which of the following is most likely to cause demand-pull inflation rather than cost-push inflation?

A.An increase in the world price of crude oil.
B.A depreciation in the exchange rate of the domestic currency.
C.A reduction in the standard rate of income tax.
D.An increase in the national minimum wage.

查看答案詳解

解題

Demand-pull inflation is caused by increases in aggregate demand. A reduction in income tax increases consumers' disposable income, which increases consumer spending, shifting aggregate demand (AD) to the right.

評分準則

1 mark for correct option (c). Reject a, b, and d as they represent cost-push pressures (increase in costs of production).

題目 6 · 選擇題

1 分

Which of the following combinations of policies is most likely to increase the long-run aggregate supply (LRAS) of an economy while simultaneously reducing the fiscal deficit?

A.An increase in government spending on infrastructure funded by government borrowing.
B.A reduction in corporation tax rates funded by a reduction in state pension benefits.
C.An increase in income tax rates combined with increased spending on public sector training.
D.Deregulation of product markets combined with a reduction in unemployment benefit entitlement.

查看答案詳解

解題

Deregulation of product markets increases efficiency and competition, which shifts LRAS to the right. A reduction in unemployment benefit entitlement reduces government transfer payments (thus reducing the fiscal deficit) while also incentivising individuals to seek work, increasing the active labor force and boosting LRAS.

評分準則

1 mark for correct option (d). Option a increases the fiscal deficit. Option b's net effect on the deficit is uncertain and may increase it if corporation tax revenues fall. Option c increases income tax rates, which might disincentivise work (reducing LRAS) and increase public spending.

題目 7 · 選擇題

1 分

What is the primary role of the Financial Policy Committee (FPC) of the Bank of England?

A.To set the base interest rate to meet the government's inflation target.
B.To identify, monitor and take action to remove or reduce systemic risks to the UK financial system.
C.To regulate individual financial institutions, such as banks and insurance companies, at a microeconomic level.
D.To manage the government's national debt by issuing Treasury bills and gilts.

查看答案詳解

解題

The Financial Policy Committee (FPC) is responsible for macroprudential regulation. Its primary role is to monitor and safeguard the stability of the financial system as a whole (systemic risk).

評分準則

1 mark for correct option (b). Reject a (MPC), c (PRA/FCA), and d (DMO).

題目 8 · 選擇題

1 分

Which of the following statements about the Gini coefficient and the Lorenz curve is correct?

A.A Gini coefficient of 1 represents perfect equality in the distribution of income.
B.The Gini coefficient is calculated as the ratio of the area between the line of perfect equality and the Lorenz curve to the total area under the line of perfect equality.
C.If Country A's Lorenz curve lies entirely closer to the line of perfect equality than Country B's, Country A has a higher Gini coefficient.
D.A progressive tax system will shift the Lorenz curve further away from the line of perfect equality.

查看答案詳解

解題

The Gini coefficient is calculated as A / (A + B), where A is the area between the line of perfect equality and the Lorenz curve, and A+B is the entire area under the 45-degree line of perfect equality. Thus, option b is correct.

評分準則

1 mark for correct option (b). Reject a, c, and d based on Gini coefficient definitions and economic theory.

題目 9 · 選擇題

1 分

A good has a price elasticity of demand (PED) of -0.4 and a price elasticity of supply (PES) of +1.2. If the government imposes an indirect tax of $ £5 $ per unit on the producers of this good, how will the burden of the tax be distributed between consumers and producers?

A.Consumers pay $ £1.25 $, producers pay $ £3.75 $
B.Consumers pay $ £2.50 $, producers pay $ £2.50 $
C.Consumers pay $ £3.75 $, producers pay $ £1.25 $
D.Consumers pay $ £5.00 $, producers pay $ £0.00 $

查看答案詳解

解題

The tax incidence on consumers is determined by the relative elasticities of demand and supply: $ \text{Consumer Burden} = \text{Tax} \times \frac{\text{PES}}{\text{PES} + |\text{PED}|} $. Substituting the values: $ 5 \times \frac{1.2}{1.2 + 0.4} = 5 \times \frac{1.2}{1.6} = 5 \times 0.75 = £3.75 $. The producer pays the remaining share: $ 5 - 3.75 = £1.25 $.

評分準則

1 mark for the correct option C. 0 marks for incorrect options.

題目 10 · 選擇題

1 分

Two countries, Alpha and Beta, produce two goods, Cheese and Wine, with constant returns and equal resources. Alpha can produce either 80 units of Cheese or 40 units of Wine. Beta can produce either 60 units of Cheese or 120 units of Wine. If the two countries decide to specialise and trade, which of the following terms of trade for 1 unit of Wine would be mutually beneficial for both countries?

A.1 unit of Wine for 0.4 units of Cheese
B.1 unit of Wine for 1.5 units of Cheese
C.1 unit of Wine for 2.5 units of Cheese
D.1 unit of Wine for 3.0 units of Cheese

查看答案詳解

解題

Alpha's opportunity cost of producing 1 unit of Wine is 2 units of Cheese. Beta's opportunity cost of producing 1 unit of Wine is 0.5 units of Cheese. For mutually beneficial trade, the terms of trade for 1 unit of Wine must lie between these two opportunity costs: $ 0.5\text{ Cheese} < 1\text{ Wine} < 2\text{ Cheese} $. Option B (1.5 units of Cheese for 1 unit of Wine) is the only option that falls within this range.

評分準則

1 mark for the correct option B. 0 marks for incorrect options.

題目 11 · 選擇題

1 分

In a kinked demand curve model of oligopoly, why is the market price of a good relatively stable even when a firm's marginal costs fluctuate?

A.The firm’s marginal cost curve is perfectly elastic at the current output level.
B.There is a vertical gap in the firm's marginal revenue curve directly below the kink in the demand curve.
C.Firms always collude formally to keep prices constant.
D.The demand curve is highly inelastic for price increases and highly elastic for price decreases.

查看答案詳解

解題

The kinked demand curve features a vertical gap (discontinuity) in the marginal revenue (MR) curve directly below the kink in the demand curve. As long as the marginal cost (MC) curve shifts within this vertical gap, the profit-maximising level of output (where MC = MR) remains unchanged, leading to a stable price at the kink.

評分準則

1 mark for the correct option B. 0 marks for incorrect options.

題目 12 · 選擇題

1 分

A monopsonist employer faces a labour supply curve given by $ W = 10 + 2L $, which has an associated marginal cost of labour of $ MCL = 10 + 4L $. The employer's marginal revenue product of labour is $ MRPL = 40 - L $. At the profit-maximising level of employment, what is the hourly wage rate paid by the monopsonist?

A.$ £10 $
B.$ £22 $
C.$ £34 $
D.$ £40 $

查看答案詳解

解題

To maximise profit, the monopsonist equates $ MCL = MRPL $: $ 10 + 4L = 40 - L \Rightarrow 5L = 30 \Rightarrow L = 6 $. To find the wage rate paid, substitute the employment level $ L = 6 $ into the labour supply curve: $ W = 10 + 2(6) = £22 $.

評分準則

1 mark for the correct option B. 0 marks for incorrect options.

題目 13 · 選擇題

1 分

A commercial bank holds deposits of $ £200 $ million and has cash reserves of $ £20 $ million. The central bank then increases the required reserve ratio to 15%. Assuming deposits remain unchanged, by how much must the commercial bank reduce its lending (advances) to satisfy the new reserve requirement?

A.$ £5 $ million
B.$ £10 $ million
C.$ £15 $ million
D.$ £30 $ million

查看答案詳解

解題

With $ £200 $ million in deposits, a 15% reserve ratio requires the bank to hold $ 0.15 \times 200 = £30 $ million in reserves. The bank currently holds only $ £20 $ million, so it must increase reserves by $ £10 $ million. Since liabilities (deposits) are unchanged, total assets must stay at $ £200 $ million, meaning lending must be reduced by $ £10 $ million to fund the cash reserve increase.

評分準則

1 mark for the correct option B. 0 marks for incorrect options.

題目 14 · 選擇題

1 分

In a given year, the market exchange rate between the UK Pound and the US Dollar is $ £1 = \$1.25 $. A standard basket of goods costing $ £100 $ in the UK costs $ \$150 $ in the US. What is the purchasing power parity (PPP) exchange rate (in dollars per pound), and is the UK Pound overvalued or undervalued at the market exchange rate compared to its PPP value?

A.PPP rate is $ \$1.50 $; the Pound is undervalued
B.PPP rate is $ \$1.50 $; the Pound is overvalued
C.PPP rate is $ \$1.20 $; the Pound is undervalued
D.PPP rate is $ \$1.20 $; the Pound is overvalued

查看答案詳解

解題

The PPP exchange rate is $ \frac{\$150}{£100} = \$1.50 $ per $ £1 $. Since the market exchange rate is only $ £1 = \$1.25 $, which is lower than the PPP rate of $ \$1.50 $, the UK Pound is undervalued in the market compared to its purchasing power parity.

評分準則

1 mark for the correct option A. 0 marks for incorrect options.

題目 15 · 選擇題

1 分

A firm has total costs (TC) of $ £50 $ at 0 units, $ £80 $ at 1 unit, $ £100 $ at 2 units, $ £114 $ at 3 units, $ £132 $ at 4 units, and $ £160 $ at 5 units. At which level of output is the average variable cost (AVC) minimised?

A.2 units
B.3 units
C.4 units
D.5 units

查看答案詳解

解題

At 0 units, TC is $ £50 $, which represents Total Fixed Cost (TFC). Variable Cost (VC) is TC - TFC. At 1 unit: VC = 30, AVC = 30. At 2 units: VC = 50, AVC = 25. At 3 units: VC = 64, AVC = 21.33. At 4 units: VC = 82, AVC = 20.50. At 5 units: VC = 110, AVC = 22.00. The lowest AVC is $ £20.50 $ at 4 units.

評分準則

1 mark for the correct option C. 0 marks for incorrect options.

題目 16 · 選擇題

1 分

According to the Laffer Curve theory, if a government reduces the marginal rate of income tax from a very high level (e.g. 80%) to a lower level (e.g. 50%), which of the following is most likely to occur?

A.Tax revenue will fall because the tax base is perfectly price inelastic.
B.Tax revenue will rise because the incentive to work and report income increases, expanding the tax base.
C.The government budget deficit will automatically double due to the reduction in tax rates.
D.Income inequality will decrease as lower-income workers benefit most from the cut in marginal rates.

查看答案詳解

解題

When tax rates are excessively high, a cut in the marginal tax rate increases incentives to work, invest, and report income. This expands the tax base significantly, more than offsetting the lower tax rate, leading to an increase in total tax revenue.

評分準則

1 mark for the correct option B. 0 marks for incorrect options.

題目 17 · 選擇題

1 分

In a market for a merit good, the marginal social benefit is given by $MSB = 100 - Q$ and the marginal private benefit is $MPB = 80 - Q$. The marginal private cost and marginal social cost are equal and constant at $40$. To achieve allocative efficiency, what specific subsidy per unit should the government introduce?

A.10
B.20
C.40
D.60 Mrp_l\)

查看答案詳解

解題

Allocative efficiency occurs where $MSB = MSC$. Given $MSB = 100 - Q$ and $MSC = 40$, the socially optimal quantity is $100 - Q = 40$, which gives $Q = 60$. At this level of output, the marginal external benefit ($MEB$) is the difference between MSB and MPB: $MEB = MSB - MPB = (100 - Q) - (80 - Q) = 20$. To internalize this positive externality, the government should set a subsidy equal to the MEB, which is 20 per unit. This shifts the marginal private benefit curve upwards to match the MSB curve, leading private agents to demand the allocatively efficient quantity of 60.

評分準則

1 mark for the correct answer (B). No partial marks available.

題目 18 · 選擇題

1 分

Country X and Country Y can both produce Wheat and Cloth. With one unit of resource, Country X can produce either 10 units of Wheat or 5 units of Cloth. Country Y can produce either 8 units of Wheat or 2 units of Cloth. Which of the following exchange rates would result in mutually beneficial trade of 1 unit of Cloth between the two countries?

A.0.5 units of Wheat
B.1.5 units of Wheat
C.3.0 units of Wheat
D.4.5 units of Wheat

查看答案詳解

解題

First, determine the opportunity cost of 1 unit of Cloth for both countries. For Country X, producing 5 units of Cloth means sacrificing 10 units of Wheat, so 1 Cloth = 2 Wheat. For Country Y, producing 2 units of Cloth means sacrificing 8 units of Wheat, so 1 Cloth = 4 Wheat. For trade to be mutually beneficial, the terms of trade for 1 unit of Cloth must lie between the opportunity costs of the two countries, i.e., between 2 and 4 units of Wheat. Out of the options, only 3.0 units of Wheat (Option C) lies within this range.

評分準則

1 mark for the correct answer (C). No partial marks available.

題目 19 · 選擇題

1 分

In a contestable market, incumbent firms are most likely to set price and output where:

A.marginal revenue equals marginal cost ($MR = MC$) to maximize short-run profits.
B.average revenue equals marginal cost ($AR = MC$) to achieve allocative efficiency.
C.average revenue equals average total cost ($AR = ATC$) to earn only normal profits and deter entry.
D.price is at its maximum point on the average revenue curve to maximize sales revenue.

查看答案詳解

解題

In a perfectly contestable market, the threat of 'hit-and-run' entry by potential rivals forces incumbent firms to set a limit price where they earn only normal profits. This occurs where average revenue equals average total cost ($AR = ATC$). If they priced where $MR = MC$ and earned supernormal profits, new firms would quickly enter the market, undercut them, and exit when profits are eroded.

評分準則

1 mark for the correct answer (C). No partial marks available.

題目 20 · 選擇題

1 分

A monopsonist employer is currently paying a wage rate of $W_1$ and employing $L_1$ units of labour. If the government introduces a national minimum wage at $W_2$, which is higher than $W_1$ but lower than the wage where the marginal revenue product of labour ($MRPL$) intersects the marginal cost of labour ($MCL$), what is the most likely outcome for employment and the wage rate?

A.Employment decreases and the wage rate increases
B.Both employment and the wage rate increase
C.Employment remains unchanged but the wage rate increases
D.Both employment and the wage rate decrease

查看答案詳解

解題

In a monopsonistic labor market, the employer faces an upward-sloping supply curve of labor, meaning the marginal cost of labor ($MCL$) is above the average cost of labor (the wage). When a minimum wage ($W_2$) is introduced above $W_1$, the MCL becomes flat at $W_2$ up to the labor supply curve. Because the new MCL is lower than the original MCL for those units of labor, the firm will increase employment to the point where the new flat MCL meets the $MRPL$ curve. Thus, both employment and the wage rate rise.

評分準則

1 mark for the correct answer (B). No partial marks available.

題目 21 · 選擇題

1 分

If a government successfully implements supply-side policies designed to increase productivity and increase the trend rate of economic growth, which of the following pairs of macroeconomic objectives is most likely to experience a short-run conflict?

A.Economic growth and low inflation
B.Unemployment and the balance of payments on current account
C.Economic growth and the budget balance
D.Inflation and the balance of payments on current account

查看答案詳解

解題

Supply-side policies (such as government investment in education, infrastructure, or tax cuts to incentivize work and investment) require significant public expenditure or lead to a short-run reduction in tax revenues. This worsens the budget balance (government debt/deficit) in the short run while trying to achieve higher long-term economic growth, creating a clear short-run conflict. Other pairs like economic growth and low inflation are complementary when driven by supply-side improvements.

評分準則

1 mark for the correct answer (C). No partial marks available.

題目 22 · 選擇題

1 分

An economy is experiencing a structural budget deficit. This means that:

A.the government's fiscal deficit will automatically disappear when the economy returns to its trend rate of growth.
B.there is an imbalance between government spending and tax revenues even when the economy is operating at full capacity.
C.the government is running a surplus on its capital account but a deficit on its current expenditure account.
D.high levels of national debt are causing interest rates to rise, crowding out private investment.

查看答案詳解

解題

A structural budget deficit is the part of the fiscal deficit that is not caused by cyclical fluctuations in the economic cycle. It is the deficit that remains even when the economy is operating at its full capacity (or trend level of output). Therefore, it requires active discretionary policy (tax increases or spending cuts) to correct, unlike a cyclical deficit which disappears as the economy recovers.

評分準則

1 mark for the correct answer (B). No partial marks available.

題目 23 · 選擇題

1 分

Country A has a Gini coefficient of 0.45, and Country B has a Gini coefficient of 0.30. Which of the following statements must be true?

A.Country B has a more equal distribution of income than Country A.
B.Country B has a higher level of absolute poverty than Country A.
C.The poorest 20% of the population in Country B have a higher average income than the poorest 20% in Country A.
D.Country A's Lorenz curve lies closer to the line of perfect equality than Country B's Lorenz curve.

查看答案詳解

解題

The Gini coefficient is a measure of statistical dispersion representing the income inequality within a nation. It ranges from 0 (perfect equality) to 1 (perfect inequality). Therefore, a lower Gini coefficient (0.30 in Country B) indicates a more equal distribution of income than a higher Gini coefficient (0.45 in Country A). It does not tell us anything about absolute poverty levels or the absolute level of income, as it is a purely relative measure.

評分準則

1 mark for the correct answer (A). No partial marks available.

題目 24 · 選擇題

1 分

Which of the following explains why a firm's short-run marginal cost curve eventually rises as output increases?

A.The law of diminishing marginal returns to the variable factor of production.
B.Diseconomies of scale arising from coordination problems.
C.An increase in the price of raw materials as the firm buys more inputs.
D.The spreading of fixed costs over a larger volume of output.

查看答案詳解

解題

In the short run, at least one factor of production (usually capital) is fixed. As more units of a variable factor (usually labor) are added, the marginal product of the variable factor eventually begins to decline due to the law of diminishing marginal returns. Because marginal cost is inversely related to marginal product ($MC = W / MP_L$), a falling marginal product causes the marginal cost to rise.

評分準則

1 mark for the correct answer (A). No partial marks available.

題目 25 · 選擇題

1 分

A government decides to impose an indirect tax of $ \pounds 3 $ per unit on a good. The price elasticity of demand for this good is -0.5 and its price elasticity of supply is +1.5. Which of the following is the most likely outcome of this tax?

A.Consumers will bear the entire burden of the tax, and quantity traded will remain unchanged.
B.Producers will bear 75% of the tax burden, and consumers will bear 25%.
C.Consumers will bear 75% of the tax burden, and producers will bear 25%.
D.The tax burden will be shared equally between consumers and producers, and consumer surplus will increase.

查看答案詳解

解題

The economic burden (incidence) of an indirect tax is shared between consumers and producers based on the relative elasticities of demand and supply. The formula for the ratio of the consumer's burden to the producer's burden is: $ \text{Consumer Burden} / \text{Producer Burden} = \text{PES} / |\text{PED}| $. Substituting the given values: $ \text{Consumer Burden} / \text{Producer Burden} = 1.5 / 0.5 = 3 $. This means the consumer burden is three times that of the producer. Thus, the consumer burden is $ 3 / (3 + 1) = 75\% $, and the producer burden is $ 1 / (3 + 1) = 25\% $.

評分準則

1 mark for the correct option C. 0 marks for incorrect options.

題目 26 · 選擇題

1 分

The table below shows export and import price indices for an economy over a three-year period:

* Year 1: Export Price Index = 100, Import Price Index = 100
* Year 2: Export Price Index = 110, Import Price Index = 105
* Year 3: Export Price Index = 115, Import Price Index = 120

Which of the following statements is correct?

A.Between Year 1 and Year 2, the terms of trade improved, meaning the country could buy more imports for a given volume of exports.
B.Between Year 2 and Year 3, the terms of trade improved because both export and import prices increased.
C.In Year 3, the terms of trade index is approximately 104.3, representing an improvement relative to Year 1.
D.Between Year 1 and Year 2, the trade balance must have improved because export prices rose faster than import prices.

查看答案詳解

解題

The Terms of Trade (ToT) index is calculated as $ (\text{Export Price Index} / \text{Import Price Index}) \times 100 $. In Year 1, the ToT index is 100. In Year 2, the ToT index is $ (110 / 105) \times 100 = 104.76 $. Since the index has risen, the terms of trade have improved, meaning that a given volume of exports can buy a larger volume of imports. In Year 3, the ToT index falls to $ (115 / 120) \times 100 = 95.83 $, which represents a deterioration relative to Year 1 and Year 2. Price changes alone do not guarantee an improvement in the overall trade balance without knowing quantities traded.

評分準則

1 mark for the correct option A. 0 marks for incorrect options.

題目 27 · 選擇題

1 分

In a monopsonistic labour market, a firm faces an upward-sloping supply curve of labour. Which of the following explains why the marginal cost of labour ($MC_L$) is greater than the average cost of labour ($AC_L$) at any given level of employment?

A.To employ an additional worker, the firm must pay a higher wage to all existing workers as well as the new worker.
B.The firm faces a perfectly elastic supply curve of labour, which means wages are determined by the industry.
C.The trade union forces the firm to pay a wage rate that is higher than the marginal revenue product of labour.
D.The marginal revenue product of labour increases at a faster rate than the wage rate as employment expands.

查看答案詳解

解題

A monopsonist is the sole buyer of labour in a market and faces the market supply curve, which is upward-sloping. Assuming the firm cannot wage-discriminate, in order to attract and employ an additional worker, it must offer a higher wage. Crucially, this higher wage must also be paid to all existing workers who were previously employed at a lower wage. As a result, the marginal cost of hiring an extra worker (the wage of the new worker plus the wage increases given to all existing workers) is strictly greater than the wage rate (average cost) of that worker.

評分準則

1 mark for the correct option A. 0 marks for incorrect options.

題目 28 · 選擇題

1 分

A monopolist is practicing third-degree price discrimination across two separate markets, Market A and Market B. Currently, the marginal revenue in Market A ($MR_A$) is $ \pounds 15 $ and the marginal revenue in Market B ($MR_B$) is $ \pounds 10 $. The firm's marginal cost ($MC$) is constant at $ \pounds 10 $ across all levels of output. To maximise total profits, how should the firm adjust its pricing and allocation of output?

A.Increase the price in Market A and decrease the price in Market B.
B.Increase output and lower the price in Market A, while maintaining the price and output in Market B.
C.Decrease output and raise the price in Market A, while increasing output in Market B.
D.Equalise prices in both markets to ensure total revenue is maximised.

查看答案詳解

解題

To maximise profits, a price-discriminating monopolist must equate marginal revenue in each sub-market to overall marginal cost: $ MR_A = MR_B = MC $. Currently, $ MR_A = \pounds 15 $, which is greater than $ MC = \pounds 10 $. This means the firm can increase profits by expanding output and sales in Market A, which requires lowering the price in Market A. Meanwhile, $ MR_B = \pounds 10 $, which is already equal to $ MC $. Thus, output and price in Market B should remain unchanged. Decreasing output in A or raising prices would move the firm further away from profit maximisation.

評分準則

1 mark for the correct option B. 0 marks for incorrect options.

題目 29 · 選擇題

1 分

Which of the following transactions would lead to an immediate increase in both the total assets and the total liabilities of a commercial bank?

A.A customer withdraws £500 in cash from their current account.
B.The bank writes off a non-performing loan worth £10,000.
C.An existing customer is approved for a new personal loan of £5,000, which is credited to their current account.
D.The bank sells £20,000 of government bonds to the central bank in exchange for liquid reserves.

查看答案詳解

解題

Under modern banking systems, when a bank approves a new loan for a customer and credits their account, it simultaneously creates a new asset and a new liability. The loan agreement itself is an asset for the bank (representing a legal claim on future payments), while the funds credited to the customer's current account are a deposit, which is a liability for the bank. Therefore, both total assets and total liabilities increase immediately by the loan amount. Cash withdrawals reduce both, writing off a loan reduces assets and equity, and selling government bonds to the central bank simply changes the composition of the bank's assets (bonds to reserves) without changing total assets or liabilities.

評分準則

1 mark for the correct option C. 0 marks for incorrect options.

題目 30 · 選擇題

1 分

According to Laffer curve analysis, if a government reduces the marginal rate of income tax for top earners from 45% to 40%, which of the following is most likely to cause total tax revenue to rise?

A.An increase in tax evasion and a corresponding expansion of the shadow economy.
B.A decrease in the incentive to work, leading to a reduction in hours worked by high earners.
C.Positive supply-side incentive effects that expand the taxable income base by a greater percentage than the reduction in the tax rate.
D.An increase in fiscal drag as high inflation pushes lower-income earners into higher tax brackets.

查看答案詳解

解題

The Laffer curve posits that there is an optimal tax rate that maximises revenue. If the tax rate is on the right-hand side of the peak (the prohibitive range), a reduction in the tax rate can increase revenue. This occurs because lower tax rates improve incentives to work, invest, and report income honestly, rather than avoiding or evading taxes. If these positive supply-side incentive effects expand the taxable income base by a greater percentage than the rate reduction, overall tax revenue will rise.

評分準則

1 mark for the correct option C. 0 marks for incorrect options.

Paper 3 - 乙部 (Investigation Case Study)

Answer all questions based on the provided synoptic data insert.

3 題目 · 50 分

題目 1 · Data Assessment

10 分

### Extract A: Selected Economic and Social Indicators for Country Y (2016–2024)

| Year | Real GDP (¥ billions) | Gini Coefficient | PM2.5 Air Pollution ($\mu\text{g/m}^3$) |
|---|---|---|---|
| 2016 | 500 | 0.35 | 18.2 |
| 2018 | 550 | 0.37 | 20.5 |
| 2020 | 580 | 0.36 | 19.8 |
| 2022 | 640 | 0.41 | 24.1 |
| 2024 | 710 | 0.44 | 28.3 |

Explain how the data in Extract A show that Country Y's economic growth was accompanied by both a worsening of income inequality and environmental degradation between 2016 and 2024.

查看答案詳解

解題

### Model Solution

To show how the data supports the statement, we must analyze the three distinct indicators and establish the links between them over the period 2016 to 2024:

1. **Economic Growth**: Economic growth is measured by the change in Real GDP. The data shows that Country Y experienced continuous growth over the period, with Real GDP rising from ¥500 billion in 2016 to ¥710 billion in 2024. This represents an overall increase of:
$$\frac{710 - 500}{500} \times 100 = 42.0\%$$

2. **Worsening Income Inequality**: The Gini coefficient is a standard measure of income inequality, where a value of 0 represents perfect equality and 1 represents perfect inequality. Between 2016 and 2024, Country Y's Gini coefficient rose from 0.35 to 0.44 (an increase of 25.7%). Despite a minor, temporary dip in 2020 to 0.36, the overall trajectory shows a significant widening of the income gap, indicating that the benefits of the 42% economic growth were not distributed evenly and disproportionately favored higher-income groups.

3. **Environmental Degradation**: PM2.5 air pollution levels measure the concentration of fine particulate matter, acting as a proxy for environmental degradation and negative externalities of production. Between 2016 and 2024, PM2.5 levels increased from 18.2 $\mu\text{g/m}^3$ to 28.3 $\mu\text{g/m}^3$, representing an overall increase in pollution of:
$$\frac{28.3 - 18.2}{18.2} \times 100 \approx 55.5\%$$

**Conclusion**:
Comparing these trends shows that as Country Y grew economically, the growth process was unsustainable and regressive. The expansion of output likely involved polluting industrial activities (causing the 55.5% increase in PM2.5 air pollution) and structural changes in the economy that concentrated wealth among capital owners rather than workers (causing the Gini coefficient to rise to 0.44).

評分準則

### Marking Scheme (10 Marks)

| Level | Marks | Description |
|---|---|---|
| **Level 3** | **8–10** | A well-structured answer that fully addresses all parts of the question. Explains the concept of economic growth, inequality, and environmental degradation using precise data references (including calculations of percentage changes). Explicitly links the growth to both negative outcomes. |
| **Level 2** | **4–7** | A reasonable explanation that uses some data from the table. May focus heavily on only one aspect (e.g., growth and inequality) while treating the other (pollution) superficially, or may lack precise calculations/definitions. |
| **Level 1** | **1–3** | A basic response that identifies some data points but fails to draw meaningful connections or explain the economic terms. Uses minimal data and contains significant errors or gaps. |

**Key Points to Reward:**
* **Calculation of Real GDP Growth**: $42\%$ increase from ¥500bn to ¥710bn.
* **Analysis of Gini Coefficient**: Rose from 0.35 to 0.44, indicating a larger share of income going to the rich.
* **Analysis of Pollution**: PM2.5 levels rose by $55.5\%$ from 18.2 to 28.3, representing negative production/consumption externalities.

題目 2 · Analytical Essay

15 分

Extract C describes the rapid growth and dominance of large e-commerce fulfilment centres as key employers in regions such as the East Midlands. Analyse the likely effects of a monopsony employer on wages, employment, and economic efficiency in a regional labour market.

查看答案詳解

解題

### Theoretical Analysis of Monopsony in the Labour Market

#### 1. Market Structure and Key Assumptions
* A **monopsony** exists when there is a single dominant buyer of labour in a given market (e.g., a massive e-commerce warehouse in a rural town with limited alternative employment opportunities).
* Unlike a firm in a perfectly competitive labour market which is a 'wage-taker' facing a perfectly elastic supply curve, a monopsonist faces the upward-sloping market supply curve for labour.
* Therefore, to attract an additional worker, the firm must offer a higher wage. Crucially, if the firm cannot wage-discriminate, it must pay this higher wage to all existing workers as well. Thus, the **Marginal Cost of Labour (MCL)** is always higher than the **Average Cost of Labour (ACL)**, which is the actual supply curve of labour ($S_L$).

#### 2. Wage and Employment Determination
* To maximise profits (or minimise costs for a given output), the monopsonist employs labour up to the point where the cost of the last unit of labour equals its revenue contribution: $MCL = MRPL$ (where MRPL is the Marginal Revenue Product of Labour, representing demand for labour).
* This intersection determines the profit-maximising quantity of labour, $L_m$.
* However, the firm does not need to pay a wage equal to $MRPL$ at this level. It only needs to pay the minimum wage required to attract $L_m$ workers, which is found by projecting down to the labour supply curve (ACL). This yields the monopsony wage rate, $W_m$.

#### 3. Comparison with Perfect Competition and Welfare Outcomes
* In a perfectly competitive labour market, equilibrium occurs where demand equals supply ($MRPL = S_L$), resulting in a higher wage rate $W_c$ and a higher level of employment $L_c$.
* Comparing the two outcomes:
* **Wages:** The monopsony wage $W_m$ is lower than the competitive wage $W_c$. This represents the 'monopsonistic exploitation' of labour, where workers are paid less than their marginal revenue product.
* **Employment:** Employment is restricted from $L_c$ to $L_m$, leading to underemployment and lower overall economic activity in the regional community.
* **Efficiency:** Because the wage (value of the marginal product) is greater than the marginal cost of supplying labour at $L_m$, there is a deadweight loss of economic welfare. Resources are allocatively inefficiently allocated, hurting both workers and the regional economy's productive potential.

評分準則

### Marking Scheme (15 Marks total)

**Level 3 (11–15 Marks) - Strong, Focused Analysis**
* **Analysis:** Clear, logically consistent, and structured chains of economic reasoning showing how a monopsonist determines wages and employment. Explicit explanation of why MCL lies above ACL.
* **Diagrammatic/Mathematical Reference:** Accurate references to the standard monopsony model (specifically comparing the $MCL = MRPL$ output with the competitive $D_L = S_L$ output).
* **Contextual Application:** Well-integrated application to the context of a regional labour market (e.g., low-skilled workers in fulfilment centres with limited occupational or geographical mobility).

**Level 2 (6–10 Marks) - Moderate Analysis**
* **Analysis:** Reasonable explanation of monopsony power, but chains of reasoning may have minor gaps or lack precision regarding the relationship between MCL and ACL.
* **Diagrammatic/Mathematical Reference:** Standard diagrams/concepts are mentioned, but the explanation of wage determination vs. employment level might contain errors.
* **Contextual Application:** Some use of the regional context, but remains largely theoretical.

**Level 1 (1–5 Marks) - Limited Analysis**
* **Analysis:** Simple identification of what a monopsony is (e.g., 'a single buyer') with little or no formal labour market theory.
* **Errors:** Significant conceptual errors regarding labour demand, supply, or market structures.

題目 3 · essay

25 分

Using the investigation data and your economic knowledge, recommend whether the government of a developing economy should introduce a 20% tariff on imported lithium-ion batteries to protect its infant domestic battery industry, or subsidise domestic battery production instead. Justify your recommendation.

查看答案詳解

解題

Introduction:

The infant industry argument suggests that newly emerging domestic industries in developing nations need temporary protection from foreign competition to achieve economies of scale and become globally competitive. The government can choose between a trade barrier (such as a 20% tariff) or a direct domestic production subsidy. This essay evaluates both options before making a recommendation.

Option 1: The 20% Tariff on Imported Lithium-ion Batteries

A 20% tariff raises the price of imported batteries from the world price $P_w$ to $P_w + T$. This allows domestic battery producers to expand output from $Q_1$ to $Q_2$ as their domestic market share increases. The benefits include:

Government Revenue: The government collects tariff revenue (represented by the imports multiplied by the tariff rate), which can be reinvested in national infrastructure.
No Direct Fiscal Cost: Unlike subsidies, a tariff does not drain the government budget, making it highly attractive for developing nations with tight fiscal constraints.

However, the drawbacks are significant:

Welfare Losses: Consumer surplus is significantly reduced. Higher battery prices harm domestic consumers and downstream industries (such as electric vehicle manufacturers or renewable energy storage projects), creating a net welfare deadweight loss (production and consumption distortions).
Retaliation: Trade partners may retaliate by imposing tariffs on the nation’s exports, reducing overall macroeconomic growth.
Inefficiency: Sheltering firms behind trade barriers can lead to X-inefficiency, as domestic firms lack the competitive pressure to innovate.

Option 2: Direct Production Subsidy to Domestic Battery Manufacturers

A subsidy shifts the domestic supply curve of batteries to the right. This allows domestic producers to expand production from $Q_1$ to $Q_2$ at the world price $P_w$ without raising prices for domestic consumers. The advantages include:

No Consumer Distortion: Domestic battery prices remain at the world price $P_w$. Downstream green industries (EVs, solar storage) continue to access cheap batteries, preserving their competitiveness and supporting green growth.
Lower Deadweight Loss: There is no consumption distortion (deadweight loss is limited only to the production side, making it more allocatively efficient than a tariff).

However, the key disadvantages are:

Fiscal Cost: The subsidy must be funded out of tax revenue, creating a massive opportunity cost (e.g., foregone spending on education or health).
Government Failure: The government risks 'picking winners' that may fail in the long run, leading to misallocated public funds.

Evaluation and Recommendation:

The choice depends heavily on the fiscal position of the country and the strategic importance of downstream industries. If the developing nation has a high fiscal deficit, a subsidy may be unsustainable, making a temporary 20% tariff the only viable option despite the consumer welfare losses. However, if the government wants to establish itself as a hub for electric vehicles and clean energy, a tariff on batteries would devastate these downstream sectors by raising input costs. Therefore, a production subsidy is the superior economic choice because it minimizes deadweight loss and protects domestic consumers, provided the government sets a clear 'sunset clause' where the subsidy is phased out after a set number of years to force domestic firms to achieve international competitiveness.

評分準則

25-Mark Essay Level Descriptors (AQA A Level Economics Paper 3 style):

Level 5 (21–25 marks): Strong, focused recommendation that directly addresses both policies (tariff vs. subsidy). Strong integration of microeconomic concepts (deadweight loss, consumer/producer surplus, market failure) and macroeconomic concepts (fiscal position, trade balance, infant industry argument). Good use of diagrams (or precise textual description of curves, prices, and areas). Clear, reasoned judgment with a justified recommendation.

Level 4 (16–20 marks): Good analysis of both policies. The evaluation is present and balanced, but may lack the depth or integration of Level 5. Clear structure with accurate economic terminology.

Level 3 (11–15 marks): Reasonable analysis of tariffs and/or subsidies. Tends to focus more on one option than the other. Evaluation is limited, perhaps concluding with a basic preference without deep justification of the trade-offs.

Level 2 (6–10 marks): Descriptive response. Explains what tariffs and subsidies are but fails to apply them systematically to the infant industry context or the trade-offs involved. Minimal evaluation.

Level 1 (1–5 marks): Very limited understanding. Confuses tariffs and subsidies or writes extremely brief, unstructured answers.

想知道自己有幾分把握？

Thinka 是 DSE 學生用的 AI 練習應用程式，有無限量練習題、即時自動批改和詳細解題步驟。逾 100,000 名學生用它確認自己真的識，而不只是「以為識」。

免費開始練習查看計劃

想練更多類似題型？在 Thinka 無限量操練，即時知道答案。

免費開始練習