The price system and the microeconomy (A level)

Worked examples (6)

• 1Calculate marginal utility from a TU schedule (4 marks)
• 2Identify diminishing marginal utility (3 marks)
• 3Apply the equi-marginal principle (5 marks)
• 4Derive demand from marginal utility (6 marks)
• 5Behavioural critique of utility theory (5 marks)
• 6Evaluate marginal utility theory (8 marks)

Model answers (4)

• ✓Model answer — 9708 Paper 4 style
• ✓Model answer — 9708 Paper 4 style
• ✓Model answer — 9708 Paper 4 Section A style
• ✓Model answer — 9708 Paper 4 style

Worked examples (6)

• 1Properties of indifference curves (4 marks)
• 2Shift vs pivot of the budget line (4 marks)
• 3Split a price change into effects (5 marks)
• 4Inferior good effects (5 marks)
• 5Giffen good (6 marks)
• 6Evaluate the indifference curve model (8 marks)

Model answers (4)

• ✓Model answer — 9708 Paper 4 style
• ✓Model answer — 9708 Paper 4 style
• ✓Model answer — 9708 Paper 4 Section A style
• ✓Model answer — 9708 Paper 4 style

Worked examples (6)

• 1Distinguish efficiency types (4 marks)
• 2Why P = MC is allocatively efficient (5 marks)
• 3Apply Pareto optimality (4 marks)
• 4Static vs dynamic efficiency trade-off (6 marks)
• 5Identify reasons for market failure (5 marks)
• 6Evaluate whether free markets are efficient (8 marks)

Model answers (4)

• ✓Model answer — 9708 Paper 4 style
• ✓Model answer — 9708 Paper 4 style
• ✓Model answer — 9708 Paper 4 Section A style
• ✓Model answer — 9708 Paper 4 style

Worked examples (6)

• 1Calculate social cost and benefit (4 marks)
• 2Classify externalities (4 marks)
• 3Negative externality diagram (6 marks)
• 4Positive externality diagram (5 marks)
• 5Asymmetric information and moral hazard (5 marks)
• 6Evaluate dealing with a negative externality (8 marks)

Model answers (4)

• ✓Model answer — 9708 Paper 4 style
• ✓Model answer — 9708 Paper 4 style
• ✓Model answer — 9708 Paper 4 Section A style
• ✓Model answer — 9708 Paper 4 style

Worked examples (6)

• 1Calculate cost concepts (5 marks)
• 2Calculate supernormal profit (4 marks)
• 3Revenue for a price-maker (4 marks)
• 4Law of diminishing returns and MC (5 marks)
• 5Internal economies of scale (6 marks)
• 6Evaluate the importance of economies of scale (8 marks)

Model answers (4)

• ✓Model answer — 9708 Paper 4 style
• ✓Model answer — 9708 Paper 4 style
• ✓Model answer — 9708 Paper 4 Section A style
• ✓Model answer — 9708 Paper 4 style

Worked examples (6)

• 1Classify market structures (4 marks)
• 2Calculate a concentration ratio (4 marks)
• 3Why perfect competition earns normal profit (5 marks)
• 4Monopoly and efficiency (6 marks)
• 5Oligopoly and the Prisoner's Dilemma (6 marks)
• 6Evaluate contestable markets (8 marks)

Model answers (4)

• ✓Model answer — 9708 Paper 4 style
• ✓Model answer — 9708 Paper 4 style
• ✓Model answer — 9708 Paper 4 Section A style
• ✓Model answer — 9708 Paper 4 style

Worked examples (6)

• 1Classify types of integration (4 marks)
• 2Why small firms survive (4 marks)
• 3Reasons for vertical integration (5 marks)
• 4Conditions for an effective cartel (5 marks)
• 5Explain the principal-agent problem (6 marks)
• 6Evaluate a merger for consumers (8 marks)

Model answers (4)

• ✓Model answer — 9708 Paper 4 style
• ✓Model answer — 9708 Paper 4 style
• ✓Model answer — 9708 Paper 4 Section A style
• ✓Model answer — 9708 Paper 4 style

Worked examples (6)

• 1Identify firm objectives and their output (4 marks)
• 2Conditions for price discrimination (5 marks)
• 3Classify degrees of price discrimination (4 marks)
• 4Explain the kinked demand curve (6 marks)
• 5Limit vs predatory pricing (5 marks)
• 6Evaluate price discrimination (8 marks)

Model answers (4)

• ✓Model answer — 9708 Paper 4 style
• ✓Model answer — 9708 Paper 4 style
• ✓Model answer — 9708 Paper 4 Section A style
• ✓Model answer — 9708 Paper 4 style