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Edexcel A-Level Economics A2 Unit 3 Business Behaviour Questions

Practise Unit 3 business behaviour through ownership forms, growth, costs, revenues, market structures, labour markets and intervention evidence.

Syllabus
First assessment 2019
Course
Economics YEC11
Level
A2

Exam points

  • classify business forms, organic or inorganic growth and demergers from ownership and firm contexts
  • use MR = MC, MR = 0 and AR = AC to identify objectives and explain price, output or profit effects
  • evaluate growth, mergers and demergers through scale, finance, culture and stakeholder outcomes
  • calculate TR, AR, MR, fixed or variable costs and profit from output, price and cost data
  • explain diminishing returns and distinguish fixed-cost, variable-cost, AC and MC curve changes

Covered syllabus points

3.3.1 - Types and sizes of businesses3.3.2 - Revenue, costs and profits3.3.3 - Market structures and contestability3.3.4 - Labour markets3.3.5 - Government intervention

Question 1

[Maximum number: 1]

A Swedish company, Lantmännen, is an agricultural business owned by 25000 farming partners.

Which one of the following is the best description of this type of business?

A

State-owned enterprise

B

Joint venture

C

Conglomerate

D

Co-operative

Question 2

[Maximum number: 1]

The table shows the number of international subscribers for Netflix and its total revenue for Q4 in the years 2017 to 2020.

Table for Question 2 — Edexcel A-Level Economics A2

Which one of the following can be deduced from the table?

A

Average revenue was $32.62 in Q4 2017

B

Average revenue was $29.70 in Q4 2018

C

Average revenue was $32.72 in Q4 2019

D

Average revenue was $30.07 in Q4 2020

Question 3

[Maximum number: 1]

Total revenue for American Airlines fell from $ 45.77 billion in 2019 to $ 17.34 billion in 2020. In response, American Airlines made 31000 staff redundant.

Which one of the following was the most likely reason for these staff redundancies?

A

The number of airline passengers rose

B

The derived demand for labour fell

C

Government employment subsidies to airlines increased

D

Taxation on airline employees decreased

Question 4

[Maximum number: 1]

A monopoly is operating at its revenue maximising output. Which one of the following is true?

A

Marginal revenue is equal to marginal cost

B

Average revenue is equal to average cost

C

Average fixed costs are rising

D

Marginal revenue is zero

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